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Tencent Apes into Web3 With MultiversX Partnership

Chinese tech giant Tencent is seeking to expand its Web3 offerings, even as the firm restructures its metaverse unit.

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Blockchain startup MultiverseX, previously known as Elrond, has formed a partnership with Tencent Cloud to help the company expand its metaverse offerings.

"From blockchains to AI and beyond, cloud computing is a great necessity and an enabling force for innovation,” Beniamin Mincu, MultiversX CEO said in a press release on Thursday.

“We are thrilled to join forces with Tencent Cloud to explore exciting routes in a new strategic partnership between the two companies on payments, Web3 hubs, infrastructure, staking services and the metaverse," he added.

Tencent, the company behind Tencent Cloud and Chinese messaging app WeChat, announced in 2020 that it would be investing 500 billion yuan ( approximately US$70 billion) over the next five years in various emerging technologies including cloud computing and blockchain. It recently added a function to support the digital yuan - China's CBDC (central bank digital currency).

In 2021, Tencent launched NFT trading platform Huanhe and sold 300 NFTs of audio clips from the talk show Shisanyao. The company’s streaming platform QQ Music was the first music platform in China to issue music NFTs.

Early troubles?

Despite its partnership with MultiversX, Tencent is planning to abandon its plans to venture into virtual reality hardware, with the company's XR (a catch term for metaverse-related technologies like virtual and augmented reality) unit reportedly undergoing a restructuring.

According to local media 36kr, the department, which was launched in June and has over 300 employees, was being partially disbanded.

Like many other tech companies, Tencent also invested heavily into the development of the metaverse. However, the market downturn and the growing popularity of other emerging technologies such as AI (artificial intelligence) has led to firms undertaking cost cutting measures.

According to a report by The Information, Microsoft has laid off 100 members of its industrial metaverse project launched in October, while the metaverse department of Meta, the parent company of Facebook, recorded a US$13.7 billion in 2022.

Read more: Meta's Metaverse Arm Reality Labs Revenue Win Overshadowed By Growing Losses