eSports platform Immutable Games wants to help build ‘a new digital asset class’ after $US15m raise
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For blockchain gaming company Immutable Games, the $US140 billion ($206.5 billion) global market for video games is on the verge of an important shift.
Rather than just playing and competing, gamers will increasingly move towards platforms where they buy, sell (and win) lucrative digital assets embedded in the gameplay.
The company turned some heads earlier this week when it announced a $US15m Series A raise from some Tier 1 gaming & technology investors.
Backers include South African internet company Naspers (which reaped billions from an early bet on Chinese internet giant Tencent), along with Galaxy Digital — the venture capital (VC) fund of high-profile crypto investor Mike Novogratz. Westpac’s venture capital arm Reinventure is also on board.
Founded in Sydney by brothers James and Robbie Ferguson, Immutable’s flagship product is Gods Unchained, a fantasy-themed trading cards game where users can win, buy and sell digital cards, which are stored as non-fungible tokens on the ethereum blockchain.
The company said it’s generated more than $US4m in revenue from a user base of around 13,000 people. Coindesk reported that in July last year, a single Gods Unchained card sold for 146 Ether, or well over $US60,000.
In that sense, Immutable’s strategy is similar in scope to that of ASX-listed Animoca Brands (ASX:AB1), which has been busy expanding its network of licensing partnerships to build a platform based around digital gaming assets.
Of the $US140 billion global gaming market, around $US80 billion is spent on in-game purchases, and Immutable CEO James Ferguson says there’s a lot more value to unlock.
“I think for these assets to be valuable, first of all you need to have an amazing game and digital experience,” he told Stockhead.
“For Gods Unchained, what we decided on was to essentially build an eSport with a world-class user experience that also has longevity.
“It’s part of the card-game genre, but it’s got some great innovations which mean the game can be played over many years.”
With the funds raised, Immutable is aiming to build out the user-base on the Gods Unchained platform from current levels towards 1 million gamers.
The company has made some notable industry hires including US game developer Chris Clay, who relocated his family from Seattle to join the team.
A Gods Unchained tournament is in the works for next year, with forecast prize money of around $US500,000.
Ferguson said the company was now focused on turning Gods Unchained into a “proper eSport”, while also building out the functionality of the Immutable platform.
“Part of what we’re building is our own marketplace, where we can take a clip of secondary trading volume,” he said.
“If you have it all integrated you don’t even need to say the word blockchain; gamers don’t care, all they want is a simple way to trade their digital assets.”
Broadly speaking, Ferguson thinks the introduction of digital property rights will give rise to a tectonic shift in the global gaming market.
“What’s interesting is that currently players don’t own the items they’re buying. In effect, they’re constantly paying to rent entertainment,” he says.
“I think that in a decade’s time that concept is going to be on the wrong side of history, because players aren’t going to get the value they deserve.
“Ultimately, what we’re trying to do is stop gaming from being a waste of time economically. When you make these items real, you essentially create a new digital asset class that can be bought and traded by the people who play.
“As gaming is becoming more popular, to not bring these property rights — which exist in the physical world — into the digital space, to me that makes it a sector that’s open to disruption.”