Shalini Nagarajan

Saudi Arabia&#8217;s NEOM initiative has proposed a $50 million investment in the Web3 gaming and investment company Animoca Brands.



NEOM&#8217;s investment division has teamed up with Animoca to further Web3 projects in alignment with Saudi Arabia&#8217;s Vision 2030 strategy.&nbsp;



According to an <a href="https://www.animocabrands.com/animoca-brands-and-neom-announce-strategic-partnership-and-investment">announcement</a> on Tuesday, half of the $50 million investment will come through convertible notes with a capped conversion price of $4.50 AUS per share, while the other half will be used to acquire Animoca shares from the secondary market.



Animoca’s share price is likely listed in Australian dollars as the firm was once listed on the Australian Securities Exchange (ASX). It was <a href="https://www.animocabrands.com/removal-from-official-list">delisted</a> from the ASX in 2020 due to non-compliance issues, yet it still trades on the secondary market.



The finalization of the financing agreement for the convertible notes is contingent on agreed conditions being met.



Read more: <a href="https://blockworks.co/news/web3-gaming-blockchain-security-blockaid">Crypto funding: Web3 gaming, blockchain security in focus</a>



Animoca Brands will collaborate with NEOM to develop <a href="https://blockworks.co/tag/web3">Web3</a> business services for global use, focusing on technological growth in the Saudi capital Riyadh and the NEOM area.&nbsp;



An Animoca Brands spokesperson did not reveal specific information regarding the projects they intend to undertake with the NEOM ecosystem, stating that the initiatives are still in the planning phase.



NEOM is an ambitious initiative launched by Saudi Arabia, and is designed to be a new-model international city and economic zone situated in the northwestern part of the country.&nbsp;



The project’s vision is for the city to be a hub for innovation, technology and sustainable development, seeking to diversify the Saudi economy away from its traditional reliance on oil.



Investing in Web3 initiatives would align with NEOM&#8217;s vision of being at the forefront of technological innovation.



Read more: <a href="https://blockworks.co/news/busan-urban-blockchain-digital-asset-exchange-south-korea">Busan to build urban blockchain and digital asset exchange</a>



“We are honored and excited to partner with and receive investment from NEOM, one of the world’s most ambitious projects seeking to use innovation and technology to redefine how we live, work, and play,” Yat Siu, Animoca’s executive chairman, said in a statement.



“We have always referred to the growth of the Web3 ecosystem as the emergence of a new meta-nation, and now NEOM could well become the first region to fully harness the power of blockchain,” Siu added.



Saudi Arabia has earlier <a href="https://blockworks.co/news/saudi-arabia-fund-crypto-blockchain-vcs">disclosed</a> investments in about 40 US venture capital firms, many of which are involved in crypto, blockchain and Web3 ventures.&nbsp;



Sanabil, associated with Saudi&#8217;s sovereign wealth entity, annually allocates about $2 billion to support businesses with innovative models. 



This fund has stakes in firms such as Andreessen Horowitz (<a href="https://blockworks.co/tag/a16z">a16z</a>), Polychain Capital and Peter Thiel-backed Valar Ventures.

Animoca

Saudi mega-project commits to $50M investment in Web3 gaming firm Animoca

Saudi Arabia has disclosed investments in nearly 40 US venture capital firms, including some deep in crypto, blockchain and Web3-related investments.



Sanabil, the venture arm of the Saudi sovereign wealth vehicle Public Investment Fund, commits around $2 billion annually into multiple funding rounds to develop businesses with novel business models, according to its website.



The fund now <a href="https://www.sanabil.com/en/our-partners/" target="_blank" rel="noreferrer noopener">lists</a> investments in the likes of <a href="https://blockworks.co/tag/a16z" target="_blank" rel="noreferrer noopener">Andreessen Horowitz</a> (A16z), <a href="https://blockworks.co/tag/coatue" target="_blank" rel="noreferrer noopener">Coatue Management</a>, KKR and Peter Thiel-backed <a href="https://blockworks.co/news/how-blockfi-went-from-tech-unicorn-to-crypto-burnout" target="_blank" rel="noreferrer noopener">Valar Ventures</a>. The news was first reported by <a href="https://www.theinformation.com/articles/saudi-arabia-discloses-ties-to-andreessen-horowitz-dozens-of-other-venture-funds" target="_blank" rel="noreferrer noopener">The Information</a>.



Funds associated with Web3 and blockchain: A16z, <a href="https://blockworks.co/tag/polychain-capital" target="_blank" rel="noreferrer noopener">Polychain Capital</a>, Griffin Gaming Partners, 500 Startups, 9Yards, B Capital, Collaborative Fund, Costanoa, Craft Ventures, Dragoneer, Greenoaks Capital, Human Capital, ICONIQ Capital, Insight Partners, KKR, Legend Capital, Race Capital, Soma Capital, TCV, Techstars, Third Point Venture, Uncorrelated, Valar Ventures, Valor Equity Partners and Village Global.



Details on exact investments, including contributions and dates, for each fund haven’t been disclosed. The outlet noted that VCs have been guarded about their links to Saudi Arabia after the 2018 killing of Washington Post journalist Jamal Khashoggi <a href="https://www.aljazeera.com/news/2021/2/26/timeline-of-the-murder-of-journalist-jamal-khashoggi" target="_blank" rel="noreferrer noopener">inside a Saudi consulate</a>.



Sanabil assigns 50% of asset allocation to venture capital, 30% to private equity and 20% to a liquid portfolio. While it has disclosed backing crypto-friendly venture capital firms, it&#8217;s unknown whether its liquid portfolio includes digital assets.



<h2 class="wp-block-heading">Saudi Arabia and the metaverse</h2>



Saudi Arabia has made moves to diversify its economy beyond depending on revenue from oil exports since 2016.



Crown Prince Mohammed bin Salman at the time announced plans to reshape the Saudi economy into a “global investment powerhouse,” and gradually wean reliance on crude by 2020.&nbsp;



In a <a href="https://www.vision2030.gov.sa/v2030/leadership-message/" target="_blank" rel="noreferrer noopener">message</a> outlining his vision for 2030, Mohammed bin Salman wrote that Saudi Arabia would “transform the Public Investment Fund into the world’s largest sovereign wealth fund.”



“Our nation holds strong investment capabilities, which we will harness to stimulate our economy and diversify our revenues,” he said.



Saudi Arabia has plans to build a twin version of its futuristic, $500-billion desert city Neom in a metaverse offering, but it’s unclear whether it will utilize blockchain or crypto.&nbsp;



The government however signed a memorandum of understanding with The Sandbox earlier this year, which will see the blockchain startup advise and potentially collaborate on metaverse projects in the future.



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a16z

Saudi Arabia’s $620B Wealth Fund Has Backed Crypto-friendly VCs

Ornella Hernandez

The 2022 FIFA World Cup in Qatar is causing the value of national soccer team fan tokens to fluctuate wildly, as events on the field have effects off it.&nbsp;



Immediately following Argentina’s 1-2 loss to Saudi Arabia on Tuesday, the ARG fan token’s price fell from $7.21 at the start of the game to $4.96 at the end of it — a 31% decline. At the time of writing, the token has <a href="https://www.fanmarketcap.com/tokens/argentine-football-association-fan-token" target="_blank" rel="noreferrer noopener">climbed</a> slightly to $5.36, according to CoinGecko.



Argentina’s loss came as a shock to fans, given that the team counted on a 36-match unbeaten streak since 2019, and it was one match short of beating Italy’s 37-match unbeaten run.



Anticipation of the game propelled ARG to the number one spot by 24-hour volume on fan token tracking site <a href="https://www.fanmarketcap.com/" target="_blank" rel="noreferrer noopener">FanMarketCap</a>.&nbsp;



<figure class="wp-block-embed is-type-wp-embed is-provider-flourish wp-block-embed-flourish"><div class="wp-block-embed__wrapper">
<iframe loading="lazy" class="wp-embedded-content" sandbox="allow-scripts" security="restricted" src="https://flo.uri.sh/visualisation/11912458/embed#?secret=PfTpQQLdrn" data-secret="PfTpQQLdrn" frameborder="0" scrolling="no" height="575" width="700"></iframe>
</div></figure>



Fan tokens represent a tiny fraction of the overall crypto market’s total value. ARG’s market capitalization is only $21.6 million, compared to ether at $138 billion or bitcoin’s $311 billion market cap.&nbsp;



Only four teams participating in the World Cup this year — Argentina, Portugal, Spain and Brazil — offer fan tokens through partnerships with the Socios platform. Token holders can benefit from merchandise and ticket promotions, as well as voting about a team’s kit change.



Fan tokens generally have an average of around 20,000 holders each, and about 16,700 people currently hold the Argentina fan token.



The Chiliz token (CHZ), which powers the Socios fan token ecosystem, has also collapsed by about 30% since the World Cup started. Portugal and Brazil have yet to play.



As for the winner of the match, <a href="https://blockworks.co/news/saudis-bidding-meme-undermined-by-crypto-investor-survey" target="_blank" rel="noreferrer noopener">Saudi Arabia</a>, it saw support from NFT investors. A collection titled &#8220;The Saudis&#8221;, featuring artwork derivative of CryptoPunks, saw trading volumes and sales soar over 2,300% in the last six hours, according to OpenSea. The collection is not tied to the Saudi Arabian government or to the country’s football team.



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Argentina

Saudi World Cup Win Shows Argentina Fan Token the Red Card

David Canellis

<div id="highlights-block_62ceb4c0f75f0" class="highlights">
 <ul>
 <li>KuCoin found sentiment is shifting negative among Saudi Arabian crypto investors</li>
 <li>76% of local digital asset holders have less than one year’s experience in the market</li>
 </ul>
 
</div>



Bitcoin discourse has been swept by a fresh conspiracy-meme that posits Saudi Arabian investors are ready to bid billions on the top cryptocurrency, saving us all from the ongoing bear market.



Such a move would diversify the Kingdom’s reserves away from oil into ‘digital gold,’ securing its financial future in a world that hopes to one day shed its fossil fuel dependency — or so goes the theory.



But if a recent report from cryptocurrency exchange KuCoin is anything to go by, it’s mostly unfounded.



Based on a commissioned survey, KuCoin found the estimated total number of Saudi crypto investors has remained relatively stable all year, at around 3 million. But their sentiment is shifting negative, the exchange found.



The report states: “In the first quarter, around half (49%) of crypto investors intended to increase investment in crypto over the coming six months, followed by the bearish market when we saw the intention slightly drop in the second quarter of 2022, as more investors changed their strategies.”



KuCoin highlighted crypto adoption in Saudi Arabia is lower than the global average, and comes in third across the Arab world in terms of raw investor numbers. Growth in the number of registered KuCoin users from Saudi Arabia did however lead the other <a href="https://www.gcc-sg.org/en-us/AboutGCC/MemberStates/pages/Home.aspx" target="_blank" rel="noreferrer noopener">GCC countries</a> throughout 2021.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">If you haven&#39;t been living under a rock for the last week, <a href="https://twitter.com/TheSaudisNFT?ref_src=twsrc%5Etfw">@TheSaudisNFT</a> is the hottest collection in town, #2 volume on <a href="https://twitter.com/opensea?ref_src=twsrc%5Etfw">@opensea</a> just under <a href="https://twitter.com/cryptopunksnfts?ref_src=twsrc%5Etfw">@cryptopunksnfts</a> <a href="https://twitter.com/hashtag/MAXBIDDING?src=hash&amp;ref_src=twsrc%5Etfw">#MAXBIDDING</a> <a href="https://t.co/hxPx3vxO2K">pic.twitter.com/hxPx3vxO2K</a>&mdash; Rotem Yakir 🍊 (@yakirrotem) <a href="https://twitter.com/yakirrotem/status/1545873060112252929?ref_src=twsrc%5Etfw">July 9, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



A majority (63%) of Saudi crypto investors are men, according to the survey, and persons below 30 years of age make up at least one third of all investors, with that figure rising to 37% throughout this year’s second quarter.



The report noted that the high proportion of fresh investors across Saudi Arabia is unique to their profile.&nbsp;



“Roughly three-quarters (76%) of crypto investors have less than one year of experience in crypto investment, including half (49%) of investors who first started trading crypto in the past six months, suggesting strong demand for crypto education in the market,” KuCoin wrote.



<h3 class="wp-block-heading">Saudi investors adopt trading bots to beat bear market</h3>



Saudi Arabians are generally investing in cryptocurrency for the long-term, the report found. 51% of surveyed digital asset holders are in crypto as they believe it’s the future of finance, while 44% reckon crypto can reap higher returns than other types of financial investments.



Although, KuCoin relayed that in this year’s second quarter, 42% of crypto investors adopted auto-trading strategies — such as trading bots — to see them through the bear market, a 7% rise from Q1.&nbsp;



Cryptocurrency exists in a legal gray area across the country, with local banks banned from handling transactions related to digital assets since 2018. And while there are no legal dangers for trading cryptocurrency, Saudi-based investors often pay close attention to what types of investments are approved under Islamic law (halal).



<figure class="wp-block-image"><img decoding="async" src="https://lh3.googleusercontent.com/_diuIiQUGG9YRKpcNOmwy-NahZTJQCZuhRgpqNZn887zMDAY2gpnewob_RkwGhYwJf_04kyJSVjVgjJLt6PAKmogYtO_wW-Zdc_M5dOu6dEOEAo0W8K1XKFpfux15XCxiLXmEr82iymY822olH5sLJc" alt=""/><figcaption>Source: <a href="https://www.kucoin.com/blog/kucoin-into-the-cryptoverse-reveals-increase-in-number-of-saudi-arabian-crypto-investors-adopting-auto-trading-strategies-in-bearish-market">KuCoin</a></figcaption></figure>



According to KuCoin’s report, which was based on just 539 survey respondents, almost half of Saudi crypto investors buy crypto with fiat and spot trade every month, as it’s the only form of crypto trading considered halal by some scholars in the Arab world.&nbsp;



Staking, futures trading and margin trading — involve interest and even gambling — are less popular.



As for what investors plan to do with their potential gains, 42% said they plan to improve their families’ living conditions, with other goals including buying a new house, saving for retirement or emergencies and other creature comforts like traveling and shopping.



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