Animoca founder says NFTs ‘fighting for attention’ with memecoins but have staying power

Yat Siu, chairman of Hong Kong’s Web3 venture capital Animoca Brands, said that non-fungible tokens are currently “fighting for attention with memecoins” but their “non-fungible” nature will have enduring relevance.

While Animoca has been a long-term investor in NFTs, the entire market is struggling to emulate its peak numbers in 2021 and 2022. According to Cryptoslam data, the week of Aug. 22, 2021 saw a total NFT trade volume of $3.24 billion, while the market recorded around $80 million last week.

“Right now, NFTs are fighting for attention with memecoins,” Siu said in an interview with The Block at the Foresight 2024 event in Hong Kong. He explained that memecoins, although fungible, have taken on part of the role that NFTs play in expressing one’s culture for many celebrities, influencers and users.

“Three years ago, I don’t know how many thousands of NFT projects launched everyday, and now that’s seen in memecoins,” the Animoca chairman said. “Eventually, when that cycle follows through … what will become more important for your reputation, not for money? NFTs.”

Siu added that the future will focus on Web3 as a means of building a strong reputation. “One of the problems right now we have in Web3 is that too many people are only thinking about the economic capital, and they haven’t yet fully identified their Web3 persona as a reputation,” he said.

As Web3 progresses to embody the cultural, social and symbolic capital, users will recognize the importance of a reputation layer in blockchain, where NFTs play an integral role with its non-fungibleness, according to Siu.

US election at play

Meanwhile, the upcoming U.S. presidential election results may determine the crypto development path the world’s largest economy is taking.

“Come November, the U.S. is going to aim to reclaim leadership in crypto,” Siu said. “If it’s Trump, it’ll be guns blazing, and if it’s Harris, I think it’ll be more cautious but not negative.”

The Animoca founder said that in his optimistic outlook, a return to crypto positivity in the U.S. would revive venture capital activities that have gone relatively quiet since the FTX collapse. The potential increase in capital flow would stimulate the interaction among the Web3 industries in the U.S., Asia and other parts of the world, Siu also said.

“In Web3, every token holder is an investor,” Siu said. “So imagine that all of America now is becoming more open to crypto… This basically opens up a whole new form of liquidity.”

On decentralized prediction platform Polymarket, the odds of U.S. Vice President Kamala Harris winning the election stood at 53% at the time of writing, while Donald Trump’s chances of winning dropped to 46% from 70% in mid-July.

While Trump has expressed his support for blockchain and crypto, the Harris campaign has recently started working with crypto leaders such as Mark Cuban to promote “Crypto for Harris.” A group of crypto pundits and lawmakers are scheduled to speak on Wednesday at an event called “Crypto4Harris” in a bid to revamp the crypto industry’s ties to Harris.

Potential IPO

Meanwhile, Animoca is weighing options for a potential return to the public market after delisting from the Australian Securities Exchange in 2020. The firm has said that it is considering an initial public offering in Hong Kong or the Middle East in late 2025 or early 2026. 

“Frankly, I think 2026 seems more likely,” Siu told The Block. 

While Siu said the company has not yet selected an advisor for a potential IPO, Animoca intends to conduct a non-deal roadshow in September as preparation. Non-deal roadshows allow investors to look into the company’s current initiatives and future plans, such as IPOs, without the purpose of selling securities.

Animoca said in an April disclosure that it remained “financially strong” with a cash and stablecoin balance of $291 million. Siu said that the firm has invested in about 540 Web3 projects to date.