OpenSea, the largest NFT marketplace, has confirmed that it raised $300 million at a $13 billion valuation. Paradigm and Coatue co-led the round. In March 2021, it raised a $23 million Series A round led by Andreessen Horowitz, followed by $100 million in July. The startup has experienced gangbuster growth. The total NFT value traded on the marketplace in December 2021 was $3.25 billion compared to $3.5 million a year earlier.
While some question the value of NFTs, many believe they are here to stay, although there’s little doubt there’s currently a pricing bubble.
The startup has a massive lead over competitors. During the last 30 days, the number two NFT marketplace Magic Eden turned over $178 million, a bit more than 5% of OpenSea’s trades, according to DappRadar.
The market leader is not without controversy. Last year an employee was involved in insider trading by investing in NFT projects he knew would be featured on the front page. More recently, the company flagged a number of NFTs where the owner claimed they were stolen. While many might see this as a good thing, it’s viewed as introducing centralization.
On that topic, many OpenSea users use self custody wallets such as MetaMask, although it supports the crypto exchange wallet from Coinbase. Yesterday Axios reported that OpenSea is in talks to acquire Dharma Labs for $110 – $130 million. Its wallet lets users move money between bank accounts and decentralized exchanges. This means a newcomer can easily convert money for ETH to pay for NFTs on OpenSea. For newcomers to crypto, participating on OpenSea still presents frictions which this acquisition may help to address.
Meanwhile, OpenSea’s recent hiring of Brian Roberts, Lyft’s first CFO, sparked rumors that Opensea might be considering an IPO.