Web3 Gaming Will Thrive Beyond Crypto Bull Run: What To Know
Web3 Gaming Investment Surge
Web3 gaming, a thriving ecosystem of blockchain-based video games, continues to blossom despite crypto market fluctuations. With a projected bull run on the horizon, questions arise about its impact on this rapidly evolving crypto landscape.
Recent data from DappRadar reveals a $600 million inflow into Web3 gaming projects in Q3 of 2023, totaling $2.3 billion in investment for the year. Despite market corrections, Game7’s report notes stability within the Web3 gaming domain.
Resilience Amid Crypto Market Trends
The resilience of Web3 gaming amid crypto’s volatile climate is remarkable. Industry insiders attribute this resilience to a shift from speculative play-to-earn models towards sustainable gameplay, emphasizing digital asset ownership and fostering robust in-game economies.
Michael Powell, Immutable’s product marketing lead, pointed out that in markets fueled by speculation and hype, it’s common to become distracted and pursue fleeting trends or shiny objects. He noted that the surge in investor interest primarily stems from Web3 gaming companies leveraging tranquility to develop valuable products with long-term strategies.
Despite quieter investment figures than the previous year, Uluç Yuca, co-founder of Curator Studios, points out a rising developer activity in the Web3 gaming sector. He attributes this surge to the sector’s potential for mass adoption, unique value proposition, and attractiveness to investors seeking portfolio diversification.
Ensuring Equity In Web3 Gaming Sector
However, concerns loom over the dominance of certain games like Axie Infinity, which reportedly saw transaction volumes exceeding $90 million, nearly double that of the closest rival, Gods Unchained, with $55 million. Meanwhile, Can Azizoglu, CEO of Web3 startup incubator Coinoxs, noted that this dominance signifies a concentration of success within the top games.
However, he also pointed out that emerging trends suggested a potential shift in the gaming landscape, referencing Casual Gaming Studios’ rising traction. Azizoglu believes this diversification could contribute to a more balanced ecosystem in the long run.
Ghanem highlighted how the strategies adopted by the top ten firms in this industry significantly impact their positions. He opined that Axie Infinity’s success stems from its focused approach to the Southeast Asia market, utilizing numerous scholarship programs to expand its user base.
This alignment with the region’s Web3 gaming interest and the team’s expansion strategy has helped Axie maintain its top position. In contrast, Gods Unchained and others utilize different growth strategies without fixating on identical growth targets or demographics.
Ghanem clarified that this divergence doesn’t necessarily reflect negatively on the industry or these games. Instead, it underscores the dominance of the Axie IP within the space.
Yet, Yuca warns against the dominance of one game, stating that it prevents diversity and innovation within the industry. He anticipates that increased investment will foster innovation and diverse game titles, catering to a broader player base.
Daiki Moriyama, director at Oasys Games, emphasized the vastness of the global video game market, indicating that the blockchain gaming industry is still in its nascent stage. Moriyama noted that numerous game developers are exploring ways to create distinct experiences by leveraging blockchain technology.
Beyond Play-to-Earn Model
While play-to-earn was a significant trend in 2022, a growing demand for enriched gaming experiences is emerging. Players now prioritize gameplay improvements over monetary gains.
Moriyama believes that while play-to-earn remains relevant, the emphasis should be on enhancing user experiences using recognized IPs and gameplay improvements. Meanwhile, Yuca notes that transitioning from token-centric models to non-fungible tokens (NFTs) as a business model ensures players’ deeper involvement and commitment to games they cherish.
The Impact Of A Bull Run
Looking ahead, industry experts anticipate the impact of the anticipated crypto bull run on Web3 gaming. While some expect a potential decrease in interest, others remain optimistic about sustained interest due to increased blockchain integration in traditional gaming.
Yuca opined that during a bullish market phase, the interest in Web3 gaming dwindles as investors divert their attention to different sectors. However, he underscores that the potential of Web3 gaming could persistently entice users and developers, ensuring a sustained long-term interest.
With only a fraction of global gamers in Web3, the industry anticipates intensified interest in leveraging blockchain technology for gaming applications.
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