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Binance Pours Cold Water on NFT Game That Pulled In $115 Million for Its Mint

source-logo  decrypt.co 30 January 2024 00:29, UTC
SkyArk Chronicles, an anime-style fantasy game, just held a huge NFT mint with eager collectors pledging $115 million worth of Ethereum for a chance to claim one of its character assets. But now Binance Labs says that its investment in the studio behind the game was misrepresented in the run-up to the mint.

Earlier this month, SkyArk Studio announced that Binance Labs—the crypto exchange’s venture capital arm—had led its $15 million funding round, which preceded the sizable NFT mint. But in truth, Binance Labs shared early Monday, its investment in the studio came back in 2021.

In a lengthy tweet, the firm alleged that SkyArk Studio violated its investment contract by using the Binance Labs branding without prior permission and that it had not, in fact, led a recent investment round. Instead, Binance Labs said that it had invested in the studio as part of its incubation program in 2021, as originally announced at the time.

“If the project had notified us and stuck to the facts, we would have been totally fine with it,” Binance Labs tweeted.

Over the past few years, Binance Labs has invested in hundreds of projects. As an investment firm, we always do our best to support the projects we invest in. Naturally, every investment firm hopes that their portfolio projects will develop well.

1) Under normal circumstances,… pic.twitter.com/CHRCHKdmbP

— Binance Labs Fund (@BinanceLabs) January 29, 2024

In attached screenshots, Binance Labs showed part of the investment contract wording, and also Telegram screenshots in which the firm asked SkyArk Studio to remove the misleading framing around participation in the recent $15 million round.

Binance Labs said that it had to make a public clarification after people started asking questions, and the VC firm noticed that SkyArk “had only deleted the tweet without clarifying the facts.” In other words, while SkyArk removed the tweet, the message of the misleading announcement continued to linger.

“We are very sorry for the miscommunication and appreciate the clarification from Binance Labs,” SkyArk Studio tweeted Monday. “We remain focused on making SkyArk a success and will continue working hard to achieve our vision.”

Big shoutout to y'all for havin' our backs!🎉

Now, we're rollin' up our sleeves and playin' detective with them addresses.

Once we're done pickin' the lucky ones, it's refund time. Best of luck to all of you!🥰 pic.twitter.com/NaWl5z31oJ

— SkyArk Chronicles (@SkyarkS) January 29, 2024

Studio co-founder Kelvin Chua tweeted a reply to Binance Labs that recalled lessons from the studio’s incubation program while further apologizing for the miscue.

“SkyArk pulled off a miraculous record NFT auction sale, which was only possible with support from communities and our investors, including our very first check from Binance Labs,” he wrote. “The last thing we hope to see is to cause any inconveniences to our followers and investors.”

The studio later posted a screenshot of a Discord post that attempted to clarify the disconnect. “SkyArk has only conducted one round of Web3 fundraising, amounting to $15 million, which began in Q3 2021,” the team wrote, adding that “Binance remains the largest investor.” The SkyArk team called it a “misunderstanding” with Binance Labs.

Binance Labs and SkyArk Studio did not reply to requests for comment from Decrypt’s GG.

SkyArk Chronicles tells the story of a fantasy hero named Satoshi Nakamoto, which is also the pseudonymous name of Bitcoin’s real-world creator. But otherwise, the game does not appear to be steeped in Bitcoin lore or terminology.

“Once upon a time, Satoshi Nakamoto was born into a bleak world of nothingness,” the game’s website reads. “A God of Creation, Satoshi created the SkyArkVerse, a safe world for all intelligent life. But where there is light, darkness will exist. Monsters rose from the deep, devastating the SkyLands—and horrified by the invasion, Satoshi must choose the heroes whom he will fight with in order to return peace back to the SkyArkVerse.”

SkyArk Studio began the refund process for the NFT mint late Monday afternoon, letting traders recover their Ethereum if they did not successfully secure one of the 8,000 minting slots. Users have 60 days to claim a refund, according to the tweet.

SkyArk Chronicles is built in part on Binance’s own BNB Chain, though the studio said that the latest batch of NFTs is minted on Ethereum.