Animoca Brands Valuation Plummets 75% In Two Years, Here’s Why

Crypto conglomerate Animoca Brands has seen its valuation tank by more than 75% in the last two years, according to latest reports. The secondary shares of the company are trading at only $1.5 billion in valuations as of now, a significant drop from the $5.9 billion valuation claimed back in July 2022.

What’s Behind the Animoca Valuation Drop

Concerns regarding the valuation drop in Animoca Brands have skyrocketed recently. However, during the first quarter financial results ending March, the firm reported a total of $3.3 billion in crypto, cash, and equities.

Despite this, investors in the secondary market seem to be unimpressed as the shares of the firm are trading at $1.5 billion valuation said Animoca executive Chairman Yat Siu. This is a staggering 75% drop from the company’s valuations back in July 2022, when it raised a total of $75 million at $5.9 billion valuation. The firm posted about $3.3 billion in crypto, cash and equities in its first quarter financial reports.

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 of the major reasons behind this steep correction could be the major slowdown in the NFT market, where Animoca has some stronghold. Although the crypto market recovered from the crash in 2022, the NFT space hasn’t. While the NFT trading volumes in January 2022 were around $6 billion, it has now dropped to $430 million in July 2024.

Animoca has successfully weathered the storm and is even considering an IPO. Siu said that if the company was publicly trading on Wall Street, the difference between the current valuation and the net value of its assets would align. “It’s just information mismatch. If we were actually 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 has recently announced a partnership with Italy-based luxury car automaker 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.” It will leverage on the strength of both firms to promote experiences for users.

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