Blockchain Gaming Giant Says Web3 Future Isn’t Far Off

Yat Siu, the cofounder and chairman of Animoca Brands, believes the transition to Web3, the next generation of the internet, will happen sooner than many people think.

“Within the next 18 months or so, we expect hundreds of millions of new entrants into the open metaverse because the quality of open metaverse products, such as new and higher quality blockchain games, will have launched, and will attract a new wave of people joining the space,” Siu said.

Siu was giving a keynote interview at the Urban Land Institute’s Asia Pacific Summit on Wednesday. He pointed to the 3.2 billion people who play video games on a regular basis, which he says are already operating in an “enclosed metaverses.” The people playing those games have created virtual identities and acquired digital goods that many players think they own, but in reality they don’t. The gaming industry is effectively renting out those virtual goods to its players.

Web3, a decentralized version of the internet, will shift digital ownership rights from tech companies into the hands of users so they can freely move across platforms in the open metaverse. Siu says people will appreciate the value this freedom gives them as they find more ways of using their NFTs across the metaverse.

He also believes the transition won’t be hindered by physical constraints. Much of the underlying infrastructure in terms of the actual hardware and networks needed to support the transition to Web3 is in place already.

Siu says Web3 adoption will be spurred by younger demographics. “One of the reasons why young people are drawn to Web3 is not because it represents a better technology, it actually represents a better future,” he said.

The younger generation has the feeling that the “existing financial systems and the existing opportunities don’t work for them,” Siu adds, but Web3 allows them to build things themselves and have digital ownership across platforms, which creates more opportunities.

Animoca has become one of the leading advocates for an open metaverse built on blockchain technology while amassing one of the world’s largest portfolios of investments in Web3. As of April this year, the company’s portfolio had grown to include 340 investments in Web3 companies and projects spanning finance, gaming, art and social media. The total value of the portfolio was $1.5 billion at the time.

Animoca was established in 2014 to develop games for smartphones and tablets. Siu said they ventured into blockchain gaming and NFTs in late 2017 when they discovered Dapper Labs (then called Axiom Zen), the Vancouver-based company behind CryptoKitties. He saw the potential of what NFTs could become in terms of digital property rights, so Animoca jumped on board.

In 2018 and 2019, when crypto winter was in full swing and others were cutting their losses and fleeing, Animoca was a buyer. Siu said they managed to get in early with investments in Sky Mavis (the developer of Axie Infinity), OpenSea (the NFT marketplace) and Decentraland (metaverse gaming platform). They also acquired Pixowl, the developer of the Sandbox.

In July, Animoca reached a valuation of $5.9 billion when it raised another $75 million. It was the second tranche fundraising round announced back in January that had raised $359 million. The company’s backers include the likes of George Soros, the Winklevoss twins, Jack Ma and Joseph Tsai, among many others.

RELATED ARTICLES

MORE FROM FORBESAnimoca Brands Hits $5.9 Billion Valuation As Crypto Winter DeepensBy Zinnia LeeMORE FROM FORBESHow An NFT Pivot Turned A Tiny Mobile Game Company Into A Multibillion-Dollar PowerhouseBy Justin BirnbaumMORE FROM FORBESHow Animoca Brands Built A $5 Billion NFT FortuneBy Steven Ehrlich