Animoca Brands denies metaverse fund cut and valuation drop to $2 billion

Animoca Brands, a venture capital firm and Web3 game developer has denied recent reports that it had cut its Metaverse fund target from $2 billion to $800 million due to volatility in the crypto market and instability in the banking sector. In a message sent to Cryptopolitan, the company denies assertions that its valuation has fallen from $6 billion as of July 2022 to roughly $2 billion in March 2023. Reports of this reduction were based on sources, who choose to remain anonymous. Animoca has stated that the original target of $2 billion still stands, with no cuts or changes.

In November, Animoca Co-Founder and chair Yat Siu announced the launch of a new fund with an aim to allocate capital to mid-to-late-stage startups in the Metaverse space. Initially, it was indicated that the target size would be between $1 billion and $2 billion depending on how much was raised. However, Animoca has since clarified that the target size of the fund is $1 billion and has always been within its stated range. A statement shared with Crypptopoliotan noted: “The claim that the Animoca Capital fund target was ‘cut’ from $2 billion to $1 billion is not correct.” ​

Animoca Capital acknowledged that the banking collapses in the U.S. have influenced available venture capital, but noted that the final size of the fund will not be determined until fundraising is complete.

In the company message to Cryptopolitan, Animoca stated: “There is no doubt that the FTX and banking crises have had a serious impact on available venture capital, but fundraising for the Animoca Capital fund is in progress. When the raise is concluded, we will inform the market with the appropriate details, including the final size of this fund.”

Siu said that the source of the leak was unnamed, and it is difficult to determine their agenda or credibility. “It’s unfortunate that we are unable to ascertain exactly who or what our sources and motives are,” he said.

Animoca has dismissed the valuation figures of Reuters and two other unnamed sources, claiming that they are inaccurate. AB1 shares were initially listed on the Australian Stock Exchange (ASX) when Animoca was in its early stage; however, due to a breach of listing rules involving crypto-related activities, Animoca was delisted in March 2020. Since then, its shares have been traded on unlisted stock-focused exchanges, such as PrimaryMarkets in Sydney. The data from this platform was used to calculate a market cap of AB1 at around $2 billion, but Animoca maintains that these figures are incomplete and do not reflect the company’s total valuation.

Animoca Brands has clarified that its statement regarding trading shares on PrimaryMarkets is not entirely accurate. The firm revealed that the arrangement with PrimaryMarkets ended in the second half of 2020, yet PrimaryMarkets has continued to trade Animoca Brands shares on their platform, regardless.

“We do not consider the thin trading activity on PrimaryMarkets to accurately reflect the company’s value. Trading volume is far too low to provide the price accuracy you would find on an actual primary market.”

Animoca Brands