OpenSea is the world’s largest and first NFT marketplace. The firm was established in 2017 with 70 employees. OpenSea provides over 80 million non-fungible tokens (NFTs) to over 600,000 users.
Devin Finzer and Alex Atallah were intrigued with the movement after witnessing the early world’s largest NFT exchange adopter communities form on Discord. However, they realized online trade-in digital collectibles are unsecure and have a high level of fraud. So the co-founders of OpenSea, a new open marketplace for NFTs, launched the company in January 2018. Users worldwide can use the platform to trade assets on the blockchain without relying on third parties or trusting one another.
The most popular marketplace for NFTs, one-of-a-kind digital items, and crypto collectibles is OpenSea. However, OpenSea offers a lot more than just digital art. In addition, users may search through game items, domain names, and even digital representations of real-world objects.
About OpenSea Stock
The stock symbol for OpenSea is a “Trade” in the form of shares in the legal entity that operates the OpenSea website. (NFT) OpenSea is currently the most prominent peer-to-peer marketplace and own NFT marketplace for non-fungible tokens. Exchanging physical property for a digital asset is now possible through NFTs, which can be anything from pictures to collectibles to video games and other virtual goods. OpenSea is an open marketplace that allows you to buy and sell NFTs using a smart contract.
NFTs are nothing more than commodities that can be bought and sold like any other, despite their blockchain structure and high-profile sales. The opensea’s market share where an item is exchanged may be valuable, frequently far more so than the underlying commodities (think Amazon, Airbnb, or Etsy). As a result, investors are increasingly turning their attention to NFT marketplaces and infrastructure rather than focusing on certain NFTs or other types of top NFT industry stocks.
Financing Rounds for OpenSea
The company raised $1.5 billion in a funding round in July. Andreessen Horowitz and actor-investor Ashton Kutcher participated in the Series B financing round, which valued Opensea at $1.5 billion.
OpenSea was founded in June 2021, and its initial funding came from private investors. The advent of digital assets in the internet economy and their adoption by consumers prompted the creation of OpenSea’s first round. To provide a comparison, OpenSea saw over $3.4 billion worth of NFT trading volume in August 2021. For context, the volume
OpenSea is also talking to investors about obtaining more capital, according to Bloomberg. According to sources familiar with the talks, investors plan on investing at least $1 billion into the firm. The private companies may be worth more than $12 billion if the money is approved. The firm has its first CFO, having hired him in preparation for this funding.
Community Backlash Following Talks of OpenSea IPO
After Rogers said it would be “foolish” not to consider going public, users on OpenSea were dismayed. As a result of the crypto community’s opposition, the OpenSea IPO was canceled.
Most respondents said they would choose digital assets rather than a traditional approach. Many individuals feel the OpenSea IPO was a sellout to large institutional investors. Others took to Twitter to express that the firm was more concerned with venture capitalists’ interests than with the community that built its success.
The OpenSea IPO isn’t around the corner, but you may enjoy this list of NFT stocks to profit and loss statements from the digital trend. Of course, always do your homework before investing. IPOs are subject to significant volatility for the first few months, and share prices are constantly shifting.
OpenSea’s Revenue growth and profitability
The business model at OpenSea is based on transaction charges received via the platform. The open sea takes a 2.5 percent commission from the seller. This implies that if you sell an NFT for 100 ETH, you keep 97.5 ETH, and OpenSea keeps 2.5 ETH (2.5%).
TechCrunch, OpenSea recorded $2.4 billion in transactions in December alone. That figure was nearly $24 billion throughout 2021, or a 200-fold boost over the previous year. The last quarter saw almost half of all these deals closed.
Despite the crypto-currency price slump that occurred this year’s start, the NFT market has remained resilient (see our previous analysis). As a result, OpenSea’s most acceptable two months on record are January and February 2022.
Many experts believe that the NFT market is still in its early stages and has enormous growth potential. Most major businesses are now exploring NFTs, and these tokens should benefit from Metaverse’s expansion. While the number of users on OpenSea has increased from 16,000 a year ago to over 500,000 today, these numbers are still exceedingly low compared to other trading exchange platforms (for example, eBay has an average of 160 million active buyers).
For making money, Opensea has already achieved breakeven well before other cryptocurrencies to other trading platforms such as Coinbase and Kraken, owing to its relatively high transaction volume increasing costs (2.5% charged to the seller).
Future valuation
The company growing was founded by Andreesen Horowitz, the lead investor in both Series A and B financing rounds. In addition, the firm has received funding from notable blockchain venture capital firms such as Coinbase Ventures, Blockchain Capital, Foundation Capital, Coatue Management, and Paradigm.
Open sea has raised a total of $423 million to date. On January 4, 2022, the most recent “round” closed. OpenSea completed a $300 million Series C funding round on that day, led by Paradigm and Coatue. This round increased the firm’s valuation to $13.3 billion. The new competition aims to speed up product development, improve security and customer service, increase investment advice in the decentralized web, and recruit. According to the OpenSea website, Dharma Labs, a cryptocurrency wallet, is negotiating with the marketplace.
Final Thoughts
Although Opensea’s income is exploding, the firm faces several obstacles. First, NFTs are a relatively young and potentially highly volatile asset class. Another “crypto-winter” (sharp drop in crypto assets) would significantly influence Opensea’s valuation. Another concern is NFTs’ ambiguous regulatory environment, as cyber-attacks and security breaches on the platform may harm the company’s reputation and drive away customers. Another risk linked to NFTs is their unclear regulatory climate. For example, certain digital assets have yet to be defined by regulatory organizations (government, SEC, etc.).
In terms of competition, OpenSea may face the introduction of a slew of new decentralized platforms. Following FTX and Binance, Coinbase plans to release its NFT exchange in 2018, which will compete with other media.
Despite these problems and dangers, Opensea is attractive to investors seeking high-potential (non-listed) businesses. As previously said, the Metaverse development provides NFTs with several favorable winds, including a significant rise in demand. Given this scenario, OpenSea may take advantage of its position as a pioneer and the well-known “network effect.” With a market dominance of over 65%, OpenSea users have an unrivaled monopoly in a sector with a current potential worth of $18 billion. In the end, OpenSea already makes money, and while commissions charged may decrease in the future, OpenSea’s profitability is likely to grow as volumes increase. Of course, these factors might change rapidly as this market develops at a breakneck pace, making any predictions highly speculative.
Frequently Asked Questions
- Will OpenSea go IPO?
In 2021, OpenSea aided in conducting almost $23 billion in transactions on its platform. In addition, this very young firm plans an initial public offering (IPO) around late 2023 or early 2024.
- Is OpenSea publicly traded?
In a few years, the ocean may be your new home. OpenSea had gained a significant step forward in terms of trading when it introduced the world’s first NFT marketplace.
- Can I buy shares in OpenSea?
OpenSea is a private firm that isn’t listed on the stock market. As a result, the company’s share is not available for trading on the open market.
- Is OpenSea profitable?
However, if we take OpenSea’s total invoice volume of $13.056 billion and divide it by their 2.5 percent service charge, we can infer that they earned roughly $326 million in revenue in 2021.
- Can you invest in OpenSea?
Any user on OpenSea, regardless of whether they have prior experience with it, can purchase or sell these items using a smart contract. In the last month, with the number of games in the market continuing to rise, OpenSea has seen over half a million dollars in trade.
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