Metaverse Game Backer Yat Siu says that low user count is not the best goal

by Arthur · October 25, 2022

(Bloomberg) — The Sandbox, a virtual world based on blockchain, is doing just fine despite a report that the platform had only about 500 daily active users, according to Yat Siu, co-founder of Animoca Brands Corp., the majority owner of the digital the game.

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Such a low number of users would be shocking for The Sandbox, which has considered raising funds at a valuation of over $4 billion. The CoinDesk report used data that only looked at blockchain transactions, Siu said Thursday in an interview with Bloomberg at the TechCrunch Disrupt conference in San Francisco. He said that these transactions, which may include the sale of virtual land represented by non-fungible tokens, do not reflect overall engagement with the platform, especially considering that more users are holding on to their NFTs to spend in-game, instead to sell them.

Looking at this metric would be comparable to claiming that “how many people trade on Wall Street is the size of the American population,” he said.

The sandbox has more than 200,000 monthly active users, he said. Other metrics, such as the number of jobs created on the platform and how much revenue is generated from the game, are more accurate measures of user engagement on the platform, Siu said.

“Every landowner in the Sandbox has a wallet that’s between half a million and $2 million,” he said.

Siu also discussed another virtual game supported by Animoca: Axie Infinity. Created by game developer Sky Mavis, the blockchain-based platform, which allows players to breed and fight monsters represented by NFTs, faced a $620 million hack in March and has seen the price of the crypto tokens used in the game as well as the user . the numbers plunge during the market downturn for digital assets. The game has also faced complaints about the player experience.

Despite these setbacks, many gaming companies likely envy Axie Infinity’s position, especially considering its billion-dollar treasury, according to Siu. Still, he compared Axie Infinity to Angry Birds, the Finnish mobile game that rose in popularity in the early 2010s. While Axie Infinity shows the potential of blockchain gaming the way Angry Birds did for mobile gaming, he doesn’t think Axie Infinity represents the future of blockchain gaming.

Overall, Siu said the impact of crypto winter has been less severe for blockchain games compared to the rest of the crypto industry. While other crypto companies are pursuing funding rounds at lower valuations, Siu said Animoca’s recent $110 million fundraising, which saw participation from Temasek Holdings Pte., Boyu Capital and GGV Capital, was a flat round. He also pointed to the potential for new regulatory developments in Hong Kong that could help the industry.

“I think in a week or two they’re going to come out with a comprehensive cryptocurrency and digital asset policy that’s going to be very progressive,” he said, noting that he would help introduce the policy at the upcoming Hong Kong Fintech Week.

“They probably wouldn’t ask me to go on stage if there was bad news, so I’m optimistic,” he said.