July 1st, Amber Japan was officially renamed as S.BLOX. After being acquired by the Singapore market maker Amber Group in February 2022, and then fully acquired by Sony Group’s subsidiary Quetta Web in August 2023, the company operating the cryptocurrency trading service platform “WhaleFin” has officially become part of the Sony Group.
Sony, with the motto “inspiring the world with the power of creativity and technology,” covers businesses including “inspiring people” gaming and network services, music, movies, “connecting people” entertainment, technology and service businesses, and imaging and sensing solutions, as well as “supporting people” medical and financial service businesses. To highlight the functions of the group’s major industries covering financial services, gaming, and entertainment, in April 2021, Sony Corporation was renamed “Sony Group Corporation” for the first time in over 60 years.
Among its various businesses, Sony’s gaming and network services, music, and movies have experienced rapid development for over a decade. In the fiscal year 2021, their overall operating income exceeded half of Sony Group’s total operating income for the first time, with overall operating profit accounting for two-thirds of the group’s total profit. With the development and iteration of blockchain technology, especially the rise of metaverse and NFT closely related to entertainment products, Sony has also begun to cautiously explore and expand into the Web3 field.
Metaverse
As a hot term in the tech industry, the concept of “metaverse” entered the vision of many companies in 2021. Sony, as an entertainment giant, is no exception. In the company’s 2022 fiscal year strategic plan, Sony expects the metaverse to experience growth and plans to create new entertainment experiences in this area. Sony’s CEO Kenichiro Yoshida also revealed that the metaverse is a social and real-time network space where games, music, movies, and animation intersect, and expressed interest in launching more products with metaverse experiences for users.
After setting its sights on the then-hot metaverse track, Sony quickly made moves. In February 2022, it signed a three-year cooperation agreement with the English Premier League champion Manchester City to jointly create the world’s first metaverse football stadium. In April, it was revealed that Sony, along with the family investment company KIRKBI behind Lego, each invested $1 billion, totaling $2 billion, in Epic Games, making a major bet on the metaverse. At the end of the year, Sony acquired the AI-based data analysis and visualization company Beyond Sports, positioning it as a metaverse sports portal, providing real-time digital sports participation solutions for leagues, broadcast companies, brands, and end consumers, and providing sports content from traditional media to metaverse communication.
NFT
There has been no unified conclusion in the industry on what the metaverse is and which technologies belong to this concept. In the future of the metaverse described by many, NFTs with interoperability and digital asset properties are considered essential elements, and the technology is believed to bring real digital ownership, economic activities, and social interaction to the metaverse. In addition, NFT technology has a wide range of applications in entertainment products such as games, music, and movies in the visible future. Therefore, since 2022, Sony has been interested in the NFT track.
In April 2022, Sony’s subsidiary Sony Network Communications established an NFT business company in Singapore, a joint venture between Sony and software development company Sun Asterisk, with Sony Network Communications holding a 70% stake. The new company aims to maximize value for customers, creators, and end users by utilizing NFT technology in Web3. According to the new company’s website, its business includes “NFT business strategy planning support,” “NFT issuance support,” “unique token issuance support,” “NFT game development support,” and “NFT promotion support.”
Another Sony sector, Sony Music, has been exploring the application of NFT technology at least since 2021 and participated in a $30 million Series A financing round of the NFT market MakersPlace. In 2022, it first partnered with the Solana-based NFT platform Snowcrash (now transformed into an AI-based music production platform) to announce plans to launch a series of NFTs from legendary musicians such as Bob Dylan; later, it established the Greater China division of RCA Records to explore opportunities in streaming media, NFTs, and the metaverse, signing singers Wang Jiaer and Huang Liling; and submitted a trademark application for the logo of Columbia Records to be used in NFT-supported media, music and podcast production, artist management, and music distribution services.
In the gaming sector, Sony is focused on developing NFT-related patents, including “unique digital asset tracking in games using tokens on a distributed ledger” and “NFT framework for transferring and using digital assets between game platforms,” which explore a method for cross-platform use and trading of NFTs. Sony also stated that it will build an NFT and blockchain system that can be applied to the PlayStation (PS) platform ecosystem.
Infrastructure
Entering 2023, Sony seems no longer content with just developing NFT technology, further expanding its business scope in the blockchain and Web3 industries.
At the beginning of 2023, Sony’s business department Sony Network Communications collaborated with the multi-chain smart contract network Astar Network to launch a Web3 incubation program for projects focusing on practical applications of NFTs and decentralized autonomous organizations (DAO) from March to June. After the conclusion of this incubation program, the organizing party, Startale Labs, received a $3.5 million investment from Sony Network Communications. In September of the same year, the two parties went even further to establish a joint venture company, “Sony Network Communications Labs Pte. Ltd.,” which will focus on the research and development of blockchain technology. Sota Watanabe, CEO of Astar, stated that the new joint venture company will advance the development of Sony Chain, a chain with the potential to surpass the Layer2 network Base previously launched by Coinbase.
Earlier this year, Startale Labs raised an additional $3.5 million in a Series A follow-up financing round, with investors including UVM Signum Blockchain Fund, Sony Network Communications, and Samsung Next Ventures, resulting in a valuation of $63.5 million after the financing. In addition, according to Singapore’s business information platform BIZFILE, the shares of Startale Labs owned by Sony Network Communications have been transferred to the Sony Group, symbolizing a step forward in blockchain in Sony’s business strategy.
Finance
In 2024, Sony began to expand its financial services to the cryptocurrency industry.
In March of this year, Sony Bank, a subsidiary of Sony Financial Group, announced plans to release “Sony Bank CONNECT” in the summer of 2024. This new mobile app is designed to provide privileges for digital securities and NFT holders, allowing users to access exciting experiences easily and with peace of mind. The app will connect to the market “SNFT” operated by SNFT Co., Ltd., allowing users to display and enjoy the NFTs they hold in SNFT.
With the product launch, Sony plans to provide digital content to customers who have participated in past activities and acquired NFTs, purchased specific digital securities, or answered questionnaires. In addition, they are developing a blockchain-based wallet and plan to expand its functionality based on customer feedback after the release. Sony Bank said, “Sony Bank CONNECT will continue to expand its functionality according to customer needs after the release and contribute to the future development of the Japanese web3 entertainment industry.”
In addition, in April of this year, Sony Bank began a conceptual verification and plans to issue a stablecoin pegged to legal tender. This trial will take place on the Polygon blockchain. Due to the advantages of reduced payment and remittance fees, Sony is exploring the use of stablecoins to promote the company’s intellectual property in the gaming and sports fields. The stablecoin trial will evaluate any legal issues related to yen-backed stablecoins and is expected to last several months. The development will be entrusted to SettleMint, a blockchain company based in Belgium.
The latest development in the cryptocurrency and financial business is the acquisition of Amber Japan mentioned at the beginning, and its renaming to S.BLOX this month. The content to be reformed or optimized in the future includes UI screen redesign, new application releases, and the expansion of supported currencies and features.
Since 2021, Sony has been continuously expanding the boundaries of its exploration of Web3, from the metaverse and NFTs to building infrastructure public chains, and now to involvement in cryptocurrency. For a large entertainment conglomerate like Sony, cautiously integrating emerging technologies into its various business sectors is the key to its continued success for over 60 years.
