Tencent dives into overseas blockchain projects in bid to rule the metaverse
Tencent has invested in Immutable, a Sydney-based NFT startup, as the Chinese tech giant looks to diversify into more blockchain opportunities overseas.
Internet giant Tencent has ventured deeper into the world of NFTs (non-fungible tokens) after recently investing in Immutable, a Australian gaming and NFT startup that specializes in blockchain-based games.
- Founded in 2018, Immutable is a Sydney-based company that bagged $200 million in a funding round recently led by Tencent and Singapore’s Temasek. It is now valued at $2.5 billion.
- Immutable specializes in blockchain-based gaming communities, in which users can maintain ownership of digital assets in the form of NFTs. It hosts Immutable X, an NFT trading platform that transacts at faster rates than Ethereum, the blockchain technology that is not only a rival cryptocurrency to Bitcoin but also provides the digital infrastructure that many existing NFT and crypto projects are based on.
- Immutable joins a squad of star-studded Tencent-backed companies working toward the metaverse, the immersive virtual cyberworld that has smitten tech investors around the world. They include the Fortnite creator Epic Games, Activision Blizzard, Ubisoft, Roblox, and even SnapChat.
The context: China has a schizophrenic approach to blockchain. Last summer, China banned cryptocurrencies, shutting down bitcoin mines, and issuing a moratorium on crypto trading.
At the same time, Beijing has sponsored its own state-backed blockchain project, and offered tentative support to the metaverse. This has led to bizarre outcomes: for example, Beijing issues its own NFTs, but the term “NFT” is taboo because it evokes a “token,” which sounds like a cryptocurrency.
- Last August, Tencent launched its own NFT platform called Huanhe (幻核). The platform sells NFTs in the forms of video, audio, photos, 3D models, and others. The year prior, Tencent earmarked 500 billion yuan ($70 billion) into “new infrastructure” based on emerging technologies like blockchain over the next five years, per Reuters.
- Immutable has already collaborated with global giants like ByteDance’s TikTok and GameStop. Last month, Gamestop and Immutable announced they would dedicate a $100 million fund to support and issue grants to “web 3.0 and metaverse gaming developers.”
The takeaway: China’s ham-handed regulatory regime, compared to the relative freedom in other countries, likely explains why Tencent has begun diversifying into overseas blockchain ventures. A source told the tech blog 36Kr that the media conglomerate is easing off the gas on domestic investments in blockchain-based technologies.
