Solana Invests $100M in South Korean web3 Startups, Focus on Gaming

Key Insights:

• Solana Ventures and the Solana Foundation have committed $100M to support South Korean crypto startups.
• The seed investment will focus on gaming studios, GameFi, NFTs, and DeFi.
• Solana is currently trading flat, down by 0.30 % over the last 24 hours.

The recent collapse of the Terra network has triggered South Korean authorities to introduce measures to scrutinize crypto exchanges. Reports noted that around 280,000 South Koreans had been victims of the unexpected plunge in UST and LUNA.

However, users are still holding strong, and investors aren’t backing down. The crypto plunge hasn’t left them in dismay, with some clinging to the belief that it is just too big to be allowed to fail.

To add more hope, Solana (SOL) has become the latest to bring funds to the crypto sector.

$100 million fund to support NFT, gaming, and DeFi projects

Solana blockchain’s key players Solana Ventures and Solana Foundation have jointly set up a $100 million fund to support crypto projects in South Korea. The funds will particularly focus on projects in gaming, non-fungible tokens (NFTs), and DeFi.

Johnny B. Lee, general manager of games for the Solana Foundation, told Bloomberg that it would also support platforms based on Terra, which was stranded by the blockchain’s collapse. He noted,

“The developers did nothing really wrong, but they’re left in the lurch.”

According to Austin Federa, head of communications at Solana Labs, the fund is backed by money from the Solana community treasury in addition to the venture arm’s pool of capital.

Lee predicted that there would be more “high-quality and fun games” launching on the Solana blockchain in the second half of 2022. He also noted that the industry would soon adopt web3 games as much as free-to-play games on mobile devices. He told TechCrunch,

“A big portion of Korea’s gaming industry is moving into web3, and we want to be flexible.”

Apart from capital inflows, Solana is also planning to offer developers in South Korea help with product and engineering.

South Korean crypto gaming sector

According to data from Statista, the overall gaming market in South Korea is projected to be valued at $18.3 billion this year.

While this figure accounts for the whole gaming industry and not crypto-related games, the number has increased steadily. Andrew Campbell, a program lead for Esports and content creator programs at Sky Mavis (the company that develops Axie Infinity), told Blockworks,

“There’s such a strong gaming culture in South Korea, and their distribution channels are a lot more centralized there.”

In what is the world’s fiercest gaming market, South Korean tech and gaming leaders like Nexon, Smilegate, and Netmarble have been pinning hopes on blockchain tech to create new business models. For instance, with a market cap of $21.43 billion, Nexon made headlines in 2021 for buying 1,171 bitcoins (BTC).

Solana price analysis

Solana’s price has been bullish after breaking down by 0.30% over the last 24 hours. The altcoin faced resistance at the $44.44 level, and firm support is seen at the $38.44 level. The digital asset is currently trading at $39.56 at press time.

On June 1, the Solana network was down for more than six hours, and transactions could not be processed. This has led to a 12% decline in the value of SOL.

This sharp single-day decline came less than a month after the token experienced a 24% drop, driven by the market instability due to the collapse of Terra’s flagship stablecoin UST.