OpenSea, one of the largest digital art marketplaces to capitalize on 2021’s non-fungible token (NFT) boom, is the latest crypto unicorn.
The NFT platform was valued at $1.5 billion after a $100 million Series B that closed Tuesday, executives told CoinDesk Tuesday. Silicon Valley’s best-known VC, Andreessen Horowitz (a16z) once again led the financing round; it headlined OpenSea’s $23 million Series A in March.
Only a handful of crypto startups have become unicorns and OpenSea is perhaps the only to do it, in part, by selling digital pictures of them: A particularly anxious-looking yellow one standing beside a steaming volcano was listed for 0.4 ETH ($703.93) on Monday.
That’s four times more than its March sale price, during the height of an NFT mania driven by crypto-rich investors and million-dollar NFT sales. The $2.5 billion industry has since cooled amid a wider crypto sell-off – at least according to the popular narrative.
But OpenSea’s trading activity has endured and even grown. Its NFT marketplace, which takes a 2.5% cut, posted a record $160 million in digital asset sales in June.
Co-founder and CEO Devin Finzer said the market has “shifted” to niche projects experimenting in ways “weird and strange.”
Bored Ape Yacht Club, whose 10,000 NFT primates double as digital access passes, “has been a big driver of volume.” Horse racing game ZED RUN has also been a hit.
“It's getting much more interesting” than one-off art sales, Finzer said. “The art is still really cool, but gaming, event ticketing, domain names, those sorts of use cases” have moved into position.
OpenSea plans to support NFT sales from networks like Flow and Tezos in addition to Ethereum, the medium’s historical hub.
The move is a compromise for economics and accessibility, said Finzer. Transactions on Ethereum are just too pricey for casual users. He said other blockchains better support low-value, high-volume projects like event ticketing or gameplay that OpenSea plans to court.
There’s still a market for minting “high-value artwork” minted on Ethereum, Finzer said. But “having more scalable blockchains and layer 2 solutions” is vital to the longevity of NFTs.
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