ATRI token fails, new token plan faces difficulties, where does Atari's Web3 strategy go?

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PANews
6 months ago
This article is approximately 1348 words,and reading the entire article takes about 2 minutes
Atari has only left the card of developing the Web3 ecosystem on Atari X.

Original author: Zen, PANews

Recently, the veteran arcade game company Atari released its financial report for the fiscal year ending on March 31, 2023. The company incurred a net loss of 9.5 million euros in the 2023 fiscal year. It terminated its license agreement with ATRI token and launched a new Web3 ecosystem plan called "Atari X" to integrate and operate Atari Web3. Atari stated that despite adverse conditions in the blockchain market, its Web3 revenue decreased by only 900,000 euros compared to the previous fiscal year, surpassing expectations. Atari will continue to execute its Web3 strategy roadmap and plans to launch the Atari Club, a Web3 technology center, while expanding further partnerships in blockchain and Web3.

Atari now positions its gaming, licensing, hardware, and Web3 activities as the company's four major business lines. However, its Web3 revenue composition is still relatively singular, mainly from the sales of NFTs and other digital assets.

ATRI token fails, new token plan faces difficulties, where does Atari's Web3 strategy go?

ATRI token project comes to an end

In fact, Atari was one of the earliest traditional gaming companies to venture into the cryptocurrency industry and adopt blockchain technology. As early as 2018, the Atari Group licensed the brand to Infinity Networks, Ltd ("INL") with the aim of creating the Atari token and a decentralized platform to provide various forms of digital entertainment, from video games to movies and music. However, due to slow progress, Atari ultimately terminated its agreement with INL and turned to collaborate with ICICB Group in Gibraltar. In early 2020, Atari announced its plan to launch the ATRI token and the Pong token named after its classic game Pong.

ATRI was publicly launched on Bitcoin.com exchange in early November 2020, during which there were issues with order processing, funds not being credited, and withdrawal delays of up to 16 hours. By the time participants in the public sale received their tokens, the price of ATRI had already been halved. At that time, Atari stated that the mission of the Atari token was to bring decentralization and universality to the video game and interactive entertainment industry. ATRI was intended to be used for various aspects of video games and interactive entertainment, and it was announced that the online multiplayer game Karma the Game of Destiny would use ATRI as an in-game currency for purchases and transactions.

ATRI token fails, new token plan faces difficulties, where does Atari's Web3 strategy go?

The initial token sale was filled with issues, which caused strong dissatisfaction among investors. Due to concerns about the lack of sufficient control and say in the management of ATRI tokens, Atari announced in April 2022 that it would terminate all agreements with ICICB Group and its subsidiaries. The Atari Chain and ATRI token, which were previously created in collaboration with ICICB Group, as well as their related websites, would no longer be licensed, and ICICB would no longer have any authority to represent Atari or its subsidiaries in any way. Atari took a snapshot of the ATRI token holdings, and token holders would need to present their ATRI tokens in the future to participate in the exchange for the "upcoming tokens."

Troubles with the new token project

The termination of the partnership signaled the failure of ATRI tokens, but Atari remained enthusiastic about the future of its blockchain-related plans. After parting ways with the former partner, Atari declared that it would create, distribute, and independently manage a new proprietary token with a focus on gaming, community, and utilities. In May 2022, Atari launched Atari X, a project that integrates Atari's blockchain interests into a unified operation under the responsibility of Atari. In response to the development needs of We 3, Atari has been continuously establishing strategic partnerships with companies in the cryptocurrency field, including The Sandbox, Nifty Labs, Co:Create, etc., all of which play a certain role in the handling of their respective tokens.

However, the plan couldn't keep up with the changes, and the new token ultimately failed to materialize.

Recently, Atari issued a token update announcement, stating that their original plan to launch a new proprietary utility token has been forced to be modified due to changes and developments in the regulatory and legal environment related to cryptocurrencies. They stated that they will not launch a new Atari token. As the main development partner of Atari, Nifty Labs has facilitated the snapshot and claiming of ATRI tokens, actively participated in the development of the Atari 50th anniversary NFT series, and was once the main developer driving the Atari new token project. They have explored its practicality, governance, and token economics together. Now, the new token plan has "stillbirth," and Nifty Labs has been forced to stop their collaboration on the new token project.

ATRI token fails, new token plan faces difficulties, where does Atari's Web3 strategy go?

As for compensation, Atari stated that they will provide a fixed amount of third-party SAND tokens for claim to each eligible ATRI holder determined in the snapshot on April 18, 2022. However, due to the limited quantity of SAND tokens, this compensation will not be one-to-one, and the ratio between SAND tokens and ATRI tokens will be determined based on the total number of claims. The claims program will start on September 1, 2023, and run for two weeks. Atari also stated that ATRI holders can continue to freely trade their ATRI tokens, and they have no plans to sell the 259 million ATRI tokens owned by the team before December 16, 2022 (equivalent to approximately 180,000 USD at the time of writing). Data shows that ATRI's circulating market value surpassed $200 million in April 2021, but as of the time of writing, its circulating market value is only about $980,000, and the token price has reached a historical low, with a drop of about 20% in the past week.

Continuing Atari X and Reviving Atari Club

Despite repeated failures, Atari is not willing to give up on its Web3 strategy. After abandoning their obsession with tokens, they still firmly believe that blockchain will continue to develop as an important part of their business, and see it as a new way to interact and collaborate with brand partners, players, and fans. Among them, Atari X, launched in May last year, is currently their core project in the Web3 business. They seem to realize that Web3 games are the most effective way to engage with their brand and build a community.

Atari will be the first company to use the Co:Create platform to create tokens for Web3 games, and with the launch of the Co:Create platform, Atari can use Web3 to expand its ecosystem and promote deeper community engagement. Co:Create completed a $25 million seed funding round in May last year, with support from A16z crypto, VaynerFund, Packy McCormick's Not Boring Capital, Amy Wu, and the team behind RTFKT and Tessera (formerly fractional.art).

Co:Create's technology provides building modules for token rewards and utility, as well as ongoing support to help projects create token plans that meet the expectations of the community. With Co:Create, anyone can deploy EVM-compatible smart contracts through a no-code dashboard, and launch tokens on the testnet using just a web browser and a connected wallet. The contracts are fully owned by the project, and the platform is free to use. In addition, Co:Create will add new features to its platform, including token reward and utility contract extensions, role-based contract permissions, and other developer tools.

ATRI token fails, new token plan faces difficulties, where does Atari's Web3 strategy go?

Atari X's next major plan is to "reintroduce" the Atari Club, which was first launched by the company in the 1980s, and the new Club will become the center of the Atari X community. It combines nostalgia, gaming, and underlying Web3 technology, bringing together passionate players from different generations in a common ecosystem, and offering exclusive rewards, merchandise, and experiences.

According to the annual report, Atari has conducted a review and forecasting of liquidity risk for all its gaming, hardware, licensing, and Web3 activities. Without any external funding, its liquidity can support Atari's planned activities for the next year. As for Atari's Web3 strategy, it currently only involves continuing to develop Atari's Web3 ecosystem under Atari X, and establishing partnerships and collaborations with leading blockchain and Web3 partners, without disclosing any plans to develop Web3 game projects.

As one of the early traditional gaming companies to participate in the Web3 industry, Atari, which seeks innovation and development, needs to bring out something substantial.

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