Leading Solana NFT Marketplace Magic Eden Completes $27M Fundraise

The funds will be used for expanding Magic Eden’s range of products and services.
Image source: Magic Eden

Quick take:

  • The funding round was led by Paradigm.
  • Magic Eden plans to build a gaming vertical and a mobile app.
  • The NFT marketplace has surpassed a transaction volume of 7.5 million SOL over the last six months.

Leading Solana NFT marketplace Magic Eden has announced today that it has completed a $27 million funding round. The round was led by Paradigm, an investment firm focused on crypto and Web3 companies.

Participants in the funding round include Sequoia and Solana Ventures. According to Bloomberg, Sequoia is betting on Solana, which is in the firm’s opinion, a better blockchain. 

Solana’s main selling point is its ability to process a block every 400 milliseconds and up to 60,000 transactions per second. It also doesn’t require layer-2 solutions to scale, which makes it more scalable and efficient than Ethereum.

In comparison, Ethereum’s Layer-1 can process roughly 13-15 transactions per second and requires Layer-2 scaling solutions like Polygon Network, Optimism, and Arbitrum for better efficiency. 

With the funding, Magic Eden has plans to build a gaming vertical as well as a mobile app for browsing, trading, and minting NFTs.

The company currently has 55 employees scattered around the world and will build its first office in San Francisco next month. 

Over the last six months, Magic Eden has surpassed over 7.5 million in transaction volume, earning it a spot as the leading Solana marketplace. Not only does 90% of Solana NFT transactions come from Magic Eden, but it has also captured 92.4% of the market share for gaming NFTs.

According to DappRadar, Magic Eden saw a 191% increase in users in the last 30 days, bringing the total number of users to more than 200,000. During the same period, OpenSea saw a 15% drop in users to 418,000. However, with OpenSea adding Solana NFTs, the future of Magic Eden is uncertain. However, Magic Eden is turning its focus to gaming NFTs and has launched MagicDAO to reward users and expand the platform’s ecosystem.

A JP Morgan analysis report published in January stated that Ethereum is losing its NFT market share to Solana due to high gas fees and network congestion. Ethereum’s NFT market share dropped from 90% at the beginning of 2021 to 80% a year later.

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