Merit Circle DAO has put forward a proposal to refund an investment from Yield Guild Games (YGG) due to what they have deemed an insufficient value. YGG had invested $175,000 in Merit Circle to back and expand its scholarship program, which allows play-to-earn gamers in developing countries to borrow NFTs (that act as an entrance fee for the game) in exchange for a cut of the in-game earnings. However, key members of Merit Circle found this investment unsatisfactory from a value-added perspective.
“Unfortunately, we were also disappointed with YGG’s response, as it demonstrates how little value they have added over the past [seven] months,” wrote Sad Cat Capital, a DAO member and investor. “As a VC firm ourselves, we take pride in the activism we do for projects that we love.”
Several executives at Merit Circle expected YGG to introduce further investors and provide social media coverage for them, but YGG says that no part of the agreement called for “value-add” services.
It’s unclear whether the contract signed by both sides contains an out-clause, so it remains to be seen whether Merit Circle will find themselves in a binding contract from which they’re unable to escape.
(All information was provided by CoinDesk)
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