Leading Solana-based NFT marketplace Magic Eden has becomes a unicorn in less than a year since its launch last September. The latest fundraising round has pushed its valuation to $1.6 billion. The founders vowed to speed up its hiring spree despite the downsizing trend hitting crypto firms amid market slumps.
A multi-channel ambition
Magic Eden – an NFT marketplace that accounted for more than 90% of NFT volume on Solana – announced that it raised an additional $130 million, with its valuation reaching $1.6 billion. That’s about a tenfold increase from its valuation three months ago, according to a source acquired by Bloomberg.
The news came in the context of a growing wave of pessimism clouding the crypto industry, with exchanges like Coinbase and Gemini massively trimming their workforce sizes to survive through the months-long bear market. The company decided to go against the headwind, ready to nearly triple its headcounts to 140 from the current 50 employees.
Jack Lu – co-founder of Magic Eden – said NFT trading volume on his platform has continued to rise in recent months, although the price of SOL is down more than 80% against ATH. The company posted revenue of $7.5 million in May and has been profitable since its launch, he added. The platform’s goal is to reach $100 million in annual revenue.
Reportedly, the predominant platform on Solana is set to use the newly raised capital to expand its primary and secondary marketplaces and support NFT creators.
Zhuoxun Yin, COO of Magic Eden and former Coinbase product manager, revealed that the market plans to serve notable NFT projects beyond the Solana network and support multiple blockchains in the future. However, Yin did not specify which blockchain besides Solana will be rolled out to the market first.
Its main rival, OpenSea, currently supporting Solana, Ethereum, Klaytn, and Polygon, was valued at $13.3 billion by January this year. Founded less than a year ago, Magic Eden has risen to be one of the top three NFT marketplaces, according to Dappradar. Its primary platform – Launchpad – has over 250 projects, and its secondary marketplace has over 7,000 Collections.
Solana or Ethereum
Sequoia Capital – the famous VC behind Magic Eden, has previously expressed concern over OpenSea’s dominance in the NFT market, saying the platform could leverage the Solana ecosystem before OpenSea expands its services to the blockchain.
Solana has attracted primarily retail investors driven by the noticeable advantage of Solana’s low gas fee for processing NFT transactions. However, the network is also known for its frequent turnoffs due to technical difficulties, causing temporary suspensions on block production and processing transactions. As such, security is a primary concern regarding the Solana network.