- NFT Technologies listed on Toronto's NEO Exchange with a market capitalization of around $17 million US dollars.
- Most companies refrain from public offerings during market downturns.
- Despite the bear market, NFT Technologies founder says there is no better time to go public. Here's why.
On Wednesday, NFT Technologies, a firm that helps novice investors put their money in Web3 assets, listed publicly on the NEO stock exchange in Toronto, Canada. The listing makes it one of the first NFT companies in the world to make such a move and the first this year. The company's market cap at the time of opening was around $28 million Canadian dollars, or the equivalent of $21.8 million US dollars. By market close that value dropped to a little over $17 million US dollars.
While most companies delay their public launches during market downturns to avoid such valuation losses, NFT Technologies co-founder and CEO Mario Nawfal thinks this could be the best time for crypto firms to list on a public exchange.
"We've got more than enough capital and we're really comfortable and everything is really cheap," NFT Tech co-founder and CEO Mario Nawfal, told Insider. "An investment of a million dollars into a company would now cost 80 or 90 percent less, so if anything we're in a better place," he said. Nawfal hopes that listing publicly will help them attract the "big money" in traditional stock markets.
According to Wahid Pierre Chammas, founder of Cyprus-based asset management firm TyreGate Capital, listing in a bear market could help firms focus on "value creation as opposed to stock price." Chammas told Insider that investor expectations have been lowered which could allow the company to innovate without thinking about the volatility of the market.
According to Google Trends analysis, interest in NFTs peaked in January before collapsing nearly 77 percent across the last five months. Similar data from NonFungible, a website that tracks the NFT ecosystem, suggests sales of NFTs declined 89.6% since its peak in September 2021. But according to the analytics firm Chainalysis, investors have already sent over $37 billion to NFT marketplaces in the first 5 months of 2022, putting them on track to beat the $40 billion sent over the last year. Chainalysis also said the number of unique buyers and sellers in the NFT marketplace has risen every quarter since Q2 2020.
But not everybody is convinced that this is a good time to list publicly. "The listing could present a challenge for our nascent company, given its exposure to the current crypto market. While that challenge is not insurmountable, due to major market headwinds the listing may not shine as much as it would have a few months ago," one NFT Technologies employee, who wished to remain anonymous because they are not authorized to speak to the press, told Insider. He sees an uphill battle for the company with NFTs still being a novel asset with volatile peaks and troughs.
For Chammas, the market for NFTs resembles the dot-com era for tech companies. "A few will rise to be unicorns and really impact our lives positively," he said, "But many won't survive." In Chammas view, while the dot-com era had its share of failures, the innovation it spurred has been unparalleled. The same, he said, could be true for blockchain technologies today.
Despite the market headwinds, Nawfal believes that the technology behind NFTs, crypto, and other aspects of Web3 are at a turning point analogous to Facebook in the early aughts. "It not only will change society, it is already changing society right now," he said.
For Nawfal, Facebook's recent rebranding is a good sign for crypto companies.
"Imagine if Ford twenty years ago changed their name to Ford Electric Cars," he said. "If people way smarter than me are changing their name to Meta, I don't know what else could be a good indicator."