Despite strike threats and mass layoffs shaking the gaming industry, blockchain gaming remains a beacon, drawing in vast amounts of investment each quarter.
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Money keeps pouring into Blockchain Gaming
DappRadar, a leading crypto data firm, recently unveiled a report showing that blockchain games raked in roughly $600 million in investments for Q3 2023. However, the new figures represent a drop from the $973 million recorded in Q2, marking a 38% decrease.
With this addition, the total investments in crypto gaming this year stand at an impressive $2.3 billion. Yet, when juxtaposed with last year’s figures, 2023’s investments make up only 30% of the total from 2022.
Turbulent times for gaming
The gaming industry has experienced significant turbulence this year. Leading game engine Unity has recently been the target of immense controversy after attempting to implement a predatory business model. Fortunately, the backlash was of such magnitude that Unity was forced to backtrack on its plans.
Additionally, industry voice actors are organizing an all-out strike over concerns that Artificial Intelligence (AI) will eventually replace them.
But perhaps what is more worrying is the amount of layoffs seen, as over 6,100 workers have been fired. Renowned companies, including Epic Games, Telltale Games, and Team17, have unfortunately had to let go of staff in recent weeks. Notably, crypto-centric gaming entities like Yuga Labs haven’t been immune to these layoffs either.
VCs undeterred by bearish macroeconomics
Venture capitalists seem undeterred by the broader market trends, with DappRadar’s data indicating that a majority of Q3’s crypto gaming investments flowed toward game-focused investment entities. This strong VC interest implies that these investment firms will continue to be instrumental in nurturing emerging blockchain game studios.
A breakdown of the numbers reveals that $262 million was directed towards investment firms, while game and metaverse projects received $213 million. An additional $125 million was funneled into the foundational aspects of blockchain gaming infrastructure.
Leading the way: Axie Infinity and Gods Unchained
One name that continues to echo in the blockchain gaming arena is Axie Infinity. Despite a significant setback—a $622 million hack in early 2022—the game witnessed a whopping $90 million NFT transaction volume this past quarter.
Following closely behind is the NFT trading card game Gods Unchained, recording $55 million in transaction volume during Q3. Just days ago, Gods Unchained released one of its largest and most exciting expansions.
Gods Unchained and Axie Infinity seem to have laid out the formula for success. The secret is to create products with engaging gameplay that will keep players coming back for more, instead of making economic incentives the main selling point. Additionally, both projects keep a proactive approach to retaining the community’s interest with relevant updates and expansions – another important piece of the puzzle.
As we witness the space evolving in the coming years, blockchain games will, hopefully, begin offering unparalleled experiences indistinguishable from traditional AAA titles.