Hong Kong-based Animoca Brands, a leader in blockchain gaming, is planning to expand its presence in the Middle East following the Hong Kong government’s efforts to strengthen ties with the region.
The company, which has Sequoia China and Temasek Holdings among its investors, intends to invest “tens of millions of dollars” in the Middle East, according to co-founder and executive chairman, Yat Siu.
Animoca sees great opportunities in the Middle East due to the region’s favorable regulations for cryptocurrencies, strong gaming culture, and youthful population.
The company plans to collaborate with Manga Productions, a subsidiary of Saudi Arabia’s MiSK Foundation, to create a Web3 project that incorporates the studio’s content. Animoca is a significant investor in Web3, with a portfolio of over 400 companies, and is known for its blockchain gaming platform, The Sandbox.
Last year, the cryptocurrency industry was plagued by a series of scandals and bankruptcies, causing investors to lose billions of dollars and leading regulators worldwide to increase their oversight of these assets. As a result, venture capital firms have reduced their investments in the industry.
However, Animoca Brands, which was valued at around US$6 billion in July 2022, is still seeking to expand its empire. The company plans to launch a new fund called Animoca Capital, which aims to raise US$1 billion this quarter and will focus on investing in later-stage Web3 companies, which are less risky than early-stage start-ups.
Hong Kong has been trying to regain business lost in recent years to places like Singapore and Dubai by implementing measures such as allowing exchange-traded funds for cryptocurrency futures and issuing the world’s first government tokenized green bonds since announcing its virtual asset plans in October 2022.
It is worth noting that Hong Kong’s Securities and Futures Commission recently formalized a proposal to allow retail investors to purchase crypto tokens with large capitalizations through licensed platforms, beginning in June.
While a previous voluntary licensing program only allowed approved exchanges to sell to investors with at least HK$8 million (US$1 million) in their portfolios, the new regulations will require all crypto platforms in the city to be licensed.
According to Siu, this development has created an unprecedented urgency and rush in Hong Kong’s history, and he believes that Asia will lead the crypto industry’s narrative from 2023 to 2024, with Hong Kong having a strong chance of being a leader in the space.
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