Hamster Kombat said it has been turning down offers by venture capitalists since its inception. Despite this stand, the popular Telegram-based tap-to-earn game continues to record commendable success.

VCs target new businesses, primarily startups with high growth potential, providing capital in exchange for an equity stake.

Hamster Kombat Rejects VC Funding

The rigidity against VC offers is part of the project’s strategy to protect its players’ interests. It also intends to preserve the developer’s commitment to provide players with a rewarding experience for participation. This is amidst concerns about VCs’ actions prioritizing their exit strategy.  

“Too many Web3 projects have built audiences only to use them as exit liquidity for their venture capital backers. This has, unfortunately, become the norm in the industry. Instead of creating innovative projects that generate real value and revenue, companies often focus on making a convincing pitch to secure funding, spend it on marketing, conduct an airdrop or even a public ICO, and then walk away — leaving users holding the bag,” Hamster Kombat explained.

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Indeed, BeInCrypto reported substantial drops for most tokens backed by top-tier VCs like Paradigm, Binance Labs, Coinbase, and others. According to research by Haseeb Qureshi, Managing Partner at Dragonfly, this realization causes retail investors to rage and even exit projects where VCs own most tokens, which makes Hamster Kombat’s stand unsurprising.

“Well, maybe it wasn’t retail investors moving money out of VC tokens and into memes, but here’s a sub-theory: VCs owned too much of these projects, and that’s why retail investors left in anger. They realized (in mid-April?) that these were all scam VC tokens, and the team + VCs owned ~30–50% of the token supply. This must have been the straw that broke the camel’s back,” Qureshi expressed.

It remains unclear exactly which VCs have approached Hamster Kombat. Nevertheless, instead of offering them a stake in its equity, the game protects its future by allocating 60% of the upcoming HMSTR token supply to players. The remaining 40% is reserved for, among other items, providing market liquidity, future ecosystem partnerships and grants, and rewarding squads.

Although the game blocks out VCs’ request to fund the project, Hamster Kombat’s record of accomplishment continues to grow. In late July, the game reported upwards of 300 million users, marking a remarkable record in Web3 game development since its March debut.

Meanwhile, project developers also advertised “the largest airdrop in crypto history,” explaining how players can get a larger airdrop. To set this record, however, it would need to surpass Uniswap’s airdrop, which distributed more than $6.43 billion worth of UNI, effectively making it the most valuable crypto airdrop so far, according to CoinGecko.

“All the activities that users do playing Hamster Kombat convert into airdrop points. Everything is important; the way you play, your social activity, and earning keys. All your points will be taken into account and the airdrop will be distributed accordingly to each player,” the Mini App unveiled.

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The airdrop is part of the project’s commitment to building the biggest and most tight-knit community. It also committed to onboarding the next billion people into Web3. To this end, it seamlessly introduces users to the underlying blockchain technology and cryptocurrencies. This makes Hamster Kombat a great tool for onboarding new Web3 users.

Similarly, it leverages Telegram’s mainstream onboarding potential. Director of investments at TON Foundation, Justin Hyun, described Telegram as a “Trojan horse” for mass blockchain adoption.

Notwithstanding, Hamster Kombat has had its fair share of troubles. Players remain targets of phishing attacks and fake airdrops as bad actors look to capitalize on the game’s success.

“Our team has exposed a series of fraudulent schemes targeting users of the Hamster Kombat. In one scheme, scammers lure victims with promises of converting in-game coins to rubles through phishing links that require Telegram login credentials,” cybersecurity firm Kaspersky reported.

In addition to scammers, Hamster Kombat’s players also suffered regulatory woes in Uzbekistan and Iran, reflecting the challenges involved.