The digital collectibles world may be tricky, but some are banking on it, and they have high expectations. Blockchain mobile gaming company, Animoca, has agreed on a partnership with Harmony to jointly acquire digital collectible startup Quidd for around $8 million.
The intention of acquiring the leading marketplace for ledger-based collectibles is to use its services to develop a network of crypto collectibles. Animoca is expected to pay $5 million as part of the acquisition while the rest shall be settled in a deferred agreement depending on profit milestones.
Animoca and Harmony to onboard the Quidd platform
Harmony shared news of the development, and it is expected that Animoca will onboard its brands and games on the Quid platform once the transaction is completed. The companies hope to solve the problem of scalability in crypto collectibles. For instance, CryptoKitties, which is a major crypto collectible that Animoca was involved in, had close to 14,000 users that overstrained the Ethereum platform.
Quidd was established in 2017, and it raised around $13 million in a Series A funding round from VCs like Sequoia. It has acquired the rights of 325 brands from major partners such as Marvel, HBO, and Disney to eventually build a big marketplace of unique digital collectibles.
The companies will try to onboard the Quidd platform that has over 200,000 users. For the companies to succeed, they are banking on the Harmony blockchain that has the capability of supporting close to 10,000 transactions per second. The Harmony network has the potential of supporting the user base and even scale up appropriately to put up with ballooning user numbers through sharding.
Animoca to help Quidd conquer the Asian market
Nick White, the Harmony Co-founder, stated that there have been surprisingly high costs attributed with the Quidd strategy, thus necessitating the buyout. He added that the company spent much to attract its first clients, and its mobile app attracted close to 800,000 monthly active users at the time. However, Quidd could not manage to keep these large numbers of users, and they dramatically dropped to the current 200,000.
Quidd is expected to benefit from Animoca’s network, and it will help it expand beyond its North America base to Asia. The plan currently is to make it attractive and then later incorporate ledger-based collectibles into leading esports synonymous to Gods Unchained. Equally, users will be able to benefit from the possibility of selling their digital products at a premium. Animoca is experienced in the space after acquiring the rights to take CryptoKitties mainstream at the beginning of last year.
Digital collectibles growing in popularity
The digital collectible space is expanding fast, and the NBA joined Animoca last week after it announced a partnership with Dapper Labs. They expect to unveil a platform for fans to trade, buy and own digital collectibles such as sports shirts on a blockchain network.