What's Behind the Animoca Valuation Drop

Concerns regarding the valuation drop in Animoca Brands have skyrocketed recently! According to the latest reports, the company's secondary shares are trading at only $1.5 billion in valuation. This is a significant drop from the $5.9 billion valuation claimed back in July 2022.

The first quarter's financial results ended in March, and the firm reported $3.3 billion in crypto, cash, and equities.

Despite this, investors in the secondary market seem to need more attention. Animoca executive Chairman Yat Siu said the firm's shares are trading at a $1.5 billion valuation.

This is a staggering 75% drop from the company's valuations in July 2022, when it raised $75 million at a $5.9 billion valuation.

Siu's estimate of Animoca's current trading value aligns with Bulletin's data, which gathers information on crypto companies from brokers and trading platforms.

One major reason behind this steep correction could be the major slowdown in the NFT market, where Animoca has a stronghold.

Although the crypto market recovered from the crash in 2022, the NFT has explicitly not. NFT trading volumes went from $6 billion in January 2022 to $ 430 million in July 2024.

Animoca has successfully weathered the storm and is even considering an IPO. Siu said that if the company were publicly trading on Wall Street, the difference between its current valuation and its assets' net value would align. "It's just an information mismatch. If we were properly listed, that would probably error correct," Siu told DL News.

Partnership With Lamborghini

Despite all the headwinds, Animoca Brands continues to pursue its goals in the NFT market. It recently announced a partnership with Italian luxury car maker Lamborghini to "drive automotive brand engagement."

In its official blog post, Animoca said that this collaboration will bring together the expertise of both companies to create "unique experiences for Automobili Lamborghini's fans and customers."

With this foray, Lamborghini is also deepening its footprint in the blockchain industry. In August 2022, the automaker joined hands with NFR Pro to introduce a range of company-branded non-fungible tokens.

This partnership marks a significant step for both companies. Animoca continues to innovate despite financial challenges. Lamborghini expands its brand engagement through cutting-edge technology.

The collaboration aims to create unique experiences for Lamborghini's fans and customers.

Such initiatives demonstrate the potential of NFTs in enhancing customer experiences. Both brands aim to leverage blockchain technology despite market fluctuations. The partnership highlights a forward-thinking approach to brand engagement.