NFT Weekly: Play Big in Crypto Winter

Digestible news on the latest developments across the fields of Web3, NFT, blockchain and metaverse in Greater China and beyond, collected for you every week by Pandaily.

This week: Bitcoin mining giant Canaan doubles profits despite China’s crypto ban, Animoca Brands bets big during crypto winter, metaverse jobs disappear as hiring slows across global tech companies, and more.

Bitcoin Mining Giant Canaan Doubles Profits Despite China’s Crypto Ban, Splits Almost 1%

Chinese crypto-mining rig maker Canaan reported 1.65 billion yuan ($246.7 million) in revenue in the second quarter of this year, up 52.8% from a year earlier. Shares in the company rose by 0.77% on Thursday following the news. Cointelegraph and Forkast first reported the story.

• The company’s net income increased to 608.9 million yuan, compared with a net income of 245 million yuan the previous year.
• Despite significant growth in profits, Canaan CEO Nangeng Zhang revealed that Q2 was a challenging period for the company. “The Covid-19 lockdown in key cities in China also led to serious disruptions to our daily operations and the demand for our AI chips,” he noted.
• The company further disclosed that it had lowered its product price for spot sales as the Bitcoin price declined during the quarter.
• “Looking ahead to the coming quarters, we see a tougher market environment from the lower Bitcoin price level, the overall increased energy price, and various pandemic and geopolitical uncertainty factors globally, all of which could put demand and price for our products at risk,” Forkast wrote . citing Canaan’s performance report.
• Despite headwinds in the global crypto market, Canaan continues its expansion in North America by building warehouses, logistics and repair units, while exploring opportunities to expand mining operations in the region, its CEO said Thursday in an earnings release. (Cointelegraph, Discard)

READ MORE:All our previous articles on Kanaan!

Animoca Brands is betting big during the crypto winter

The latest decline in digital assets has wiped $2 trillion from the global crypto market since November. However, Animoca Brands, Asia’s largest gaming software developer and venture capital firm, is amassing a massive portfolio of 340 gaming, crypto and social media companies in hopes of reviving the industry. Bloomberg first reported the story.

• According to Yat Siu, the company’s co-founder and executive chairman, the aim of the investments is to help people regain ownership of virtual assets from the hands of companies such as Microsoft and Meta.
• The co-founder went on to say that the strategy was informed by the crypto crash of 2018, which gave him the opportunity to turn his video game studio into a leading venture capital firm focused on the crypto industry.
• The company’s meteoric rise was dependent on its continued investment in crypto games, such as CryptoKittiesone of the world’s first blockchain games where virtual cats can be bought and sold with digital currencies.
• Just four years later, Animoca is one of the crypto industry’s most influential investors, backed by Sequoia Capital and George Soros, a legendary hedge fund manager who is considered one of the most successful investors of all time.
• “If people say this is a crypto winter, then 2018 was the crypto ice age,” says Siu. “Now is the time to deploy more capital, not less.”
• Animoca is one of the few companies still investing in the crypto industry. His strategy could backfire if this downturn doesn’t last like 2018. (Bloomberg)

READ MORE: All our previous articles on Animoca Brands!

Gate.io Group’s Hippo Financial Services Gets Hong Kong Crypto Custody License

Gate.io’s Hippo Financial Services Limited has been granted a Trust or Company Service Provider (TCSP) license to provide virtual asset custody services in Hong Kong, according to a press release on Monday.

• The TCSP license is required for any entity operating or seeking to operate a trust or company service business in Hong Kong.
• “Obtaining the TCSP license in Hong Kong enables us to deepen our relationship with global crypto investors as an industry leader. Next, we will build localized operations to bring our products and services to users in Hong Kong,” said Tom Yang, EVP for Gate.io Group.
• With an initial focus on virtual assets, Hippo FS dedicates resources to establishing teams to manage local operations, including the security of the service infrastructure and customer assets.
• “Establishing a custody business in Hong Kong is a global strategic milestone for Gate.io Group, not only because Hong Kong is the hub for many financial institutions and investors, but more importantly, the industry-leading regulatory regime in Hong Kong provides additional confidence for investors placing assets in Hippo FS’s custody,” according to Dr. Han Lin, founder and CEO of Gate.io Group.
• Gate.io’s exchange is now based in the Cayman Islands. It left China after the government issued a blanket ban on crypto. (CoinDesk, PRNewswire)

Crypto Exchange Gemini offers staking support for investors

Hong Kong-based crypto exchange Gemini announced on Friday that it will offer support to customers based in the US, Singapore and Hong Kong to earn and store stake rewards in their Gemini accounts. CoinDesk first reported the story.

• The firm will support staking MATIC on the Polygon network and will roll out support for digital assets including ETH, AUDIO, SOL and DOT in the coming months.
• The announcement came as crypto firms began expanding their stake offerings ahead of the Ethereum blockchain’s much-anticipated merger, which will shift the protocol from proof-of-work to a faster, more energy-efficient proof-of-stake model. After years of delays, The Merge is now scheduled to take place on September 15th.
• “It’s now more clear than ever that people are interested in betting, especially now that we’re headed for the Ethereum merger,” a company spokesperson told CoinDesk. “With Ethereum as a staking option for those at Gemini right after and after the merger, and with more liquidity and higher returns, staking is becoming more and more attractive to people.”
• Staking is a process where crypto owners lock their assets for a specific period of time to support the operation of a blockchain. In return for staking crypto, the owner earns more cryptocurrency. Many blockchains use a proof-of-stake mechanism.
• Staking is only possible via the proof-of-stake consensus mechanism, which is a specific method used by certain blockchains to select honest participants and verify new blocks of data that are added to the network. (CoinDesk)

Metaverse jobs are disappearing like hires at global tech companies

New monthly job postings across all industries with ‘metaverse’ in the title fell 81% between April and June, Bloomberg reported, citing data from Revelio Labs, a workforce research company.

• The decline comes after metaverse-related jobs surged in the months following Facebook’s rebranding as Meta. The drop-off also coincides with a broader cooling across the technology sector, which has led to hiring freezes and layoffs.
• Meta slowed hiring in May, but said it has picked up in recent months. “After temporarily halting hiring for certain roles within the company, we are pleased to resume hiring for some of our highest priority areas,” said Andrea Beasley, company spokeswoman.
• Last month, Facebook parent Meta reported a steeper-than-expected drop in revenue, lost revenue and issued a surprisingly weak forecast, pointing to a second consecutive decline in year-over-year sales. Zuckerberg said on Meta’s July 27 earnings call that he was “slowing down” on long-term investments because of the revenue shortfall.
• Meta shares have lost about half their value since the start of the year, underscoring investor concerns about the health of the company’s core online advertising business.
• Meanwhile, Apple, Meta’s new rival in the Web3 space, said on July 28 that it would be “more deliberate” in its recruitment. (Bloomberg, CNBC)

FTX earnings grew by 1000% during the Crypto Craze

Crypto exchange FTX took revenue from less than $90 million in 2020 to more than $1 billion last year as cryptocurrencies hit an all-time high. CNBC first reported the story.

• FTX rode cryptomania to a billion dollars in revenue last year, while expanding its global footprint through a flurry of acquisitions. In June, the company announced that it had reached an agreement to acquire Canadian crypto platform Bitvo and is reportedly considering acquiring Robinhood.
• The company also reportedly set new fundraising goals, matching a funding round in January in which the firm closed a $400 million round, giving it a $32 billion valuation.
• The crypto exchange’s revenue increased by more than 1,000% from $89 million to $1.02 billion in 2021, according to audited financials seen by CNBC. (CNBC)

That’s it for this week’s newsletter – thanks for reading! As always, we welcome feedback on how we can make this newsletter better. Write to us at [email protected]. See you again next week!