Will 2023 finally see an explosion of crypto gaming? The signs are mixed, with former play-to-earn darling Axie Infinity falling out of favor and hemorrhaging players, while mainstream gamers report that Web3 games still have playability issues.
The bright spot is that AAA games are finally starting to emerge in Web3, with projects like Illuvium garnering attention. And there’s a ton of runaway, considering that Web3 gaming raised $4.5 billion in 2022. For comparison, metaverse projects raised $1.9 billion.
The thesis is compelling for crypto gaming, but the way forward is unclear. Do tokenomics help immerse gamers in a game, or do they distract from the experience?
“I think the first big win will come from a game with tokenomics that don’t explode and implode in six months, and that also doesn’t feel like a ‘crypto’ game,” Geoff Renaud, co-founder and chief marketing officer of Web2-to-Web3 creative marketing agency Invisible North, tells Magazine.
“StepN showed a ton of promise for easy onboarding and user experience but was marred by bad economics. Once there’s a game model that feels frictionless — where you don’t even know you’re on the blockchain — and that has sustainable incentives for users, there will be a massive follow-on effect. Blockchain gaming needs to have one big win, and I have a feeling that’s more likely to be from a simple mobile game that looks like Candy Crush than a AAA title out of the gates.”
Getting it right will help unlock mainstream crypto adoption. Illuvium founder Kieran Warwick tells Magazine that blockchain gaming is the “best case of onboarding the mainstream to crypto, as it’s easier to onboard the masses through a game than a complex DeFi product.”
Despite compelling numbers, commercial success is hard
Many believe the GameFi sector has a bright future. According to a report by consulting firm MarketsandMarkets, the global blockchain gaming market will grow from $4.6 billion in 2022 to $65.7 billion by 2027. Naavik and Bitkraft Ventures, meanwhile, predict blockchain gaming to grow to a $50 billion market by 2025.
Are these projections plausible? Perhaps. GameFi accounted for 49% of all DApp activity in 2022, according to DappRadar. And there are 3 billion gamers worldwide, about half of which are in the Asia-Pacific region, and mobile gaming is a…
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