United States Investment Firm Mark Down the Value of OpenSea by 90%
On Nov. 7, The Information reported that Coatue Management had reduced its investment in OpenSea from $120 million to $13 million. This implies that OpenSea has fallen to an on-paper valuation of $1.4 billion. Additionally, Coatue also marked down its investment in Web3 payment provider MoonPay by 90%.
In January 2022, OpenSea raised $300 million in a Series C round led by crypto venture capital firm Paradigm and Coatue. This outsized investment saw the NFT platform valued at $13.3 billion.
Following a stubborn bear market and a year-long slump in NFT trading activity, OpenSea announced a 50% reduction in staff on Nov. 3 as part of its plan to relaunch as OpenSea 2.0. OpenSea CEO Devin Fizner said the new version of the platform will focus on upgrading its technology and increasing its speed and quality. Fizner believes that a smaller team will allow for the platform to remain “nimble and attentive.”
In August, OpenSea faced criticism after announcing its decision to retire its operator filter, a feature that allowed creators to blacklist non-royalties-enforcing marketplaces.
Coatue’s markdown comes amid a slump in NFT trading volumes. The sector peaked in 2021, recording over $14 billion in sales during the year. Since then, NFT popularity has been on the decline, with overall trading volumes dropping by 80% since March 2022.
A Nov. 3 report from crypto data firm DappRadar found that the NFT market recorded its first month of gains in over a year, notching a $99 million increase month-over-month in October.
The decrease in investment value in OpenSea by Coatue Management reflects the larger trend of declining popularity and trading volumes in the NFT market. It remains to be seen how these developments will impact the future of NFT platforms and digital marketplaces.
❗Follow us on Twitter to get all the latest crypto news as soon as they're out! 🚀