Sports merchandising company Fanatics divested 60% of its stake in the NFT platform Candy Digital given the crypto winter and the decline in the appeal of Sports NFTs.
According to a CNBC report, Fanatics will sell its stake to a group of investors led by Galaxy Digital, the other original founding shareholder.
The Fanatics CEO announced the move to the staff today in a letter saying it was a very straightforward and easy decision for the company to make for various reasons.
Fanatics CEO Michael Rubin stated, “Divesting our ownership stake at this time allowed us to ensure investors were able to recoup most of their investment via cash or additional shares in Fanatics.”
In 2022, the NFT market shrank dramatically due to broader crypto market declines. Of Candy Digital’s 100 employees, at least one-third were let go in November.
Also Read: Argo Blockchain Sells Helios to Galaxy Digital for $65 million
According to Rubin, it has become pretty apparent over the past year that NFT is unlikely to be successful or sustainable as a stand-alone business.
The Fanatics CEO believes that connectivity between physical and digital collectibles will be the most powerful way to create an emotional resonance and enduring success for NFTs and their collectors.
Rubin noted, “We are 100% confident that this was the best long-term decision for Fanatics and our partners and we look forward to growing our digital and trading cards business together under Fanatics Collectibles with the incredible rights we have across the NFL, MLB, NBA, NCAA, WWE, UFC, F1, UEFA, Disney and more.”
