Investment firm Tiger Global has made significant adjustments to the valuations of its holdings, impacting major players in the crypto and tech space. The latest move includes a substantial reduction in the valuations of Bored Ape Yacht Club (BAYC) and the NFT marketplace OpenSea.
Tiger Global marked down its investment in Bored Ape Yacht Club by a staggering 69%, reflecting the challenges faced by the NFT collection. The price floor for BAYC is currently down 77% from its all-time high in May 2022. Simultaneously, Tiger Global devalued its stake in OpenSea by a striking 94%, aligning with the tough market conditions for NFTs.
Broader Impact on Tiger Global’s Portfolio
The adjustments extend beyond the crypto space, with Tiger Global’s Private Investment Partners 15 fund devaluing other holdings as well. Investments in AI-powered email company Superhuman saw a 45% markdown, while the valuation of privacy-focused search engine DuckDuckGo was reduced by 72%. Investors in the fund reportedly experienced an 18% paper loss at the end of September.
Tiger Global isn’t the only investment firm adapting to the challenging market conditions. In early November 2023, Coatue Management also decided to reduce the valuation of its investment in OpenSea, cutting its stake from an initial $120 million to $13 million.
The move by Tiger Global and Coatue Management reflects the broader challenges faced by the NFT market in the midst of a prolonged bear market affecting the entire cryptocurrency industry. OpenSea, in response to market conditions, announced a 50% reduction in its workforce, aligning with a strategic shift towards OpenSea 2.0.
Despite the current challenges, there is optimism in the air. JPMorgan’s recent report suggests a potential resurgence in the decentralized finance (DeFi) and non-fungible token (NFT) sectors. The anticipation of a U.S.-based spot Bitcoin exchange-traded fund (ETF) is seen as a positive influence on the overall cryptocurrency market sentiment. However, the report also exercises cautious optimism, emphasizing that it might be too early to become overly excited about the revival.