Hong Kong-based Animoca Brands has announced its intent to invest a significant sum in Saudi Arabia’s budding Web3 gaming ecosystem.
Animoca Brands’ desire to be part of the growing Web3 ecosystem has seen it ink deals with key entities in the Gulf state, including a memorandum of understanding (MOU) with King Abdulaziz City for Science and Technology (KACST).
Animoca Brands CEO Yat Siu confirmed in a statement that Saudi Arabia is the next uncharted frontier for the Web3 unicorn, citing several reasons. According to Siu, Saudi’s young and tech-savvy population stands on the precipice of a major transition to Web3 gaming, providing a window of opportunity to clinch valuable market share.
“Most of our investments are all over the world. But our priority in terms of building out infrastructure and building out business operations is definitely Saudi,” said Siu. “Also, Saudi is a market in itself with a very strong gaming population.”
It remains unclear exactly how much Animoca Brands will be willing to sink into the local play-to-earn gaming scene, but experts are predicting a hefty price tag. Despite a rising gaming culture, Web3 games are almost non-existent in Saudi Arabia, leaving Animoca Brands with a steep mountain to climb.
While Animoca Brands may be willing to back Web3 gaming startups, a chunk of its resources will be deployed toward establishing uniform standards and an underlying architecture for the ecosystem.
“Southeast Asia is a growing market with an established framework,” remarked Siu. “Whereas in Saudi, we literally have to design the frameworks.”
Another strategy for Animoca Brands to ensure its success in Saudi Arabia’s gaming market is to begin with casual games before raising the stakes with blockbuster titles. The allure of owning and transferring in-game assets is expected to attract Saudi gamers as the company seeks to repeat its successes in the Philippines and other Southeast Asian countries.
Animoca Brands has previously dabbled in Saudi Arabia, famously collaborating with Manga Productions to launch a Web3 adoption project. In late 2023, the venture capital funds received $50 million from a subsidiary of the Public Investment Fund to explore
metaverse use cases.
Putting the past behind
Animoca Brands has had its fair share of bad patches in recent months, culminating in halving a $2 billion Web3 fund. At the time, the company cited falling digital asset prices as a reason for slashing the value of its funds, but the recent upswing in prices has caused the company to adopt an aggressive growth stance.
“Obviously, 2023 was a difficult year, but so far this year, values have increased dramatically,” said Siu. “It’s going to have a material impact.”
Previously, the company’s online game store has faced significant headwinds, ranging from scathing criticisms from users to Steam blocking Web3 elements on its platform. Still, Siu remains confident that the unicorn is on course to snag a significant share of the Middle Eastern Web3 gaming market.
Watch: Web3 will change our lives, nChain CIO Christine Leong explains how
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