As the virtual asset market has sharply contracted this year, the value of virtual assets held by domestic game companies also appears to have plummeted. Some game companies disposed of coins while taking losses in the billions of won, and those that kept their holdings were hit directly by a drop in appraised value.
On the 22nd, according to the Financial Supervisory Service electronic disclosure system, the virtual asset book value and holdings of major game companies such as Netmarble, Neowiz, Kakao Games, and NC showed large changes in the first quarter of this year.
Netmarble made large-scale sales of 13 types of virtual assets in the first quarter, including Bitcoin (BTC), Ethereum (ETH), Tether (USDT), and KAIA. Among them, it disposed of 37.50 BTC and 164.19 ETH, leaving 0.01 and 0.49, respectively, as of the end of the first quarter. In effect, it cleared out virtually all of its Bitcoin and Ethereum holdings.
Large losses also occurred during the disposal process. Netmarble recorded a disposal loss of about 836 million won in the process of selling Bitcoin. In addition, it disposed of 4,565,152 Tether (USDT), incurring about 1.987 billion won in losses, and 30 million KAIA, incurring about 449 million won in losses. Losses also occurred in the disposal of numerous altcoins. As a result, Netmarble's virtual asset disposal losses in the first quarter amounted to about 3.9 billion won, and even after reflecting disposal gains from some virtual assets, the net loss was tallied at about 3.7 billion won.
Neowiz also took losses while disposing of its virtual assets in the first quarter. The company sold 16 Bitcoin and 169 Ethereum, recording losses of about 433 million won and 233 million won, respectively, in the process. Accordingly, Neowiz's net loss on virtual asset disposals in the first quarter was about 670 million won. After reducing its virtual asset exposure, Neowiz's Bitcoin and Ethereum holdings at the end of the first quarter were 78 and 437, respectively.
Some game companies adjusted their portfolios to respond to returns. The book value of Bitcoin (BTC) held by Wemade decreased by about 800 million won, from 18.823 billion won in the previous quarter to 18.008 billion won in the first quarter. KAIA also fell from 1.944 billion won to 1.284 billion won over the same period, and the book value of other altcoins declined as well. However, with Bitcoin holdings effectively maintained at 245, down from 246, Wemade increased the share of stablecoins such as Tether and USD Coin to defend against a decline in overall book value returns.
NC, which was unable to sell its virtual assets, was hit directly by a drop in book value. NC holds SUI, NS, and DEEP coins secured in return for an investment in the U.S. blockchain company Mysten Labs, and some of these assets are tied up in lockup (sale restrictions). As a result, it fully absorbed the impact of falling book value while maintaining its holdings. Compared with the fourth quarter of last year, the value of SUI held by NC in the first quarter fell from about 24.6 billion won to 15.6 billion won, while the value of NS and DEEP also decreased by about 23 million won and 460 million won, respectively.
As the virtual asset market froze this year, game companies that had expanded related investments were affected. Bitcoin surpassed $120,000 for the first time in July last year, then rose intraday to $126,110 (about 192 million won) in Oct., setting an all-time high. However, it then turned downward and plunged to $60,429 (about 92 million won) on the 4th. As a result, game companies that had aggressively invested in virtual assets to build blockchain-based game ecosystems and diversify their financial portfolios were hit directly by the market slump.
A game industry official said, "With the recent slump in the virtual asset market, the value of held assets is falling, and some corporations are liquidating holdings while taking losses," while adding, "Many game companies hold virtual assets more for strategic linkage with the blockchain ecosystem than for price gains." The official added, "The burden of falling appraised values may continue for the time being, but if the market recovers, there is a possibility it could again connect to corporate value and investment revenue."