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Web3 Gaming Snapshot by ChainPlay & Footprint Analytics: Market Resurgence and Future Prospects
Embark on a Web3 gaming adventure this week (Dec 13th - Dec 20th)
Welcome to the latest edition of ChainPlay's Newsletter, where we dive into the most exciting and innovative Web3 games of the week.
Reporting on Web3 Gaming industry trends, investments, growth, and more… You can find all of what you need in ChainPlay.gg
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The gaming market is witnessing a renaissance, with a remarkable 34% surge in gaming token market capitalization within a month. While user numbers are increasing, transaction volumes have been consistently declining for the past five months. This apparent contradiction raises an important question: What are the driving forces behind user growth amid declining transaction volumes? And how can we navigate this puzzle and find a sustainable solution?
Amidst these dynamics, the Ronin ecosystem has emerged as a major player, prompting speculation about whether pixels could become the next Axie Infinity.
Data for this report was obtained from Footprint's GameFi research page and ChainPlay.GG. An easy-to-use dashboard containing the most vital stats and metrics to understand the Web3 Game industry.
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Crypto Macro Overview
Bitcoin’s price continued to rise in November, commencing at $34,629 and culminating in a 9.3% increase, with the closing price reaching $37,848. Ethereum opened the month at $1,812 and saw a steady growth of 11.9%, concluding the month at $2,028.
Financial markets demonstrated a tempered response to a spectrum of potential risks. The anticipation surrounding the approval of a spot Bitcoin ETF contributed to a bullish sentiment while encouraging developments in the Middle East conflict alleviated concerns over broader regional instability. Similarly, the United States' Consumer Price Index (CPI) maintained its downward trajectory, fueling optimism for prospective Federal Reserve rate reductions and the possibility of a 'soft landing' for the U.S. economy.
Changpeng Zhao(CZ) stepped down as CEO of Binance on November 21 as part of a major $4 billion settlement between United States agencies and Binance. This settlement brought closure to extensive investigations by the Department of Justice and other entities into Binance's alleged anti-money laundering and sanctions violations. Bitcoin dipped to $35,800 following news of Binance's settlement but recovered to stabilize in the mid-$36,000s by the next morning. The settlement is viewed positively, as it reduces systemic risk in the crypto industry and could boost investor confidence.
Overall Web3 Game Market
Tokens, which serve as in-game currency or governance tools, play a significant role in the development and operation of a game. According to Footprint Analytics, there was a notable 34% increase in the total market cap of game tokens, escalating from $4.92 billion on November 1 to $6.61 billion on November 30, indicating significant development within the Web3 gaming industry in November.
In addition, the number of active wallets experienced a monthly increase of 18.7%, rising from 1.1 million on November 1st to 1.3 million on November 30th, in line with the rapid escalation observed in the game token market cap.
Amidst a positive trajectory in both active wallets and token prices, the overall market saw a notable decline in both transactions and volume compared to the previous month. Specifically, monthly transactions dropped from 515.25 million in October to 400.47 million in November.
We can speculate that the current upward trend in tokens and players is due to market optimism and the prevalence of short-term users driven by FOMO, rather than a stable, long-term user base dedicated to the ecosystem.
While there is growing interest and initial participation in web3 games, we don't know if this has translated into sustained engagement or investment by players.
This observed trend leads to a critical question: How can the web3 gaming sector evolve from this state of temporary interest to a more sustainable model?
Web3 Mass Adoption
The answer lies in two key aspects: mass adoption and continuous user engagement.
For mass adoption, industry leaders are integrating with popular social platforms. Animoca Brands invested in Telegram's blockchain TON ecosystem, enabling seamless integration. Twitter-hosted games like XPet demonstrate web3 gaming's potential within social networks.
Currently, there's also a growing trend of attracting long-term users, with mainstream web2 games increasingly venturing into web3, helping to improve the playability of web3 games. Notably, Axie Infinity's developer brought Japanese web2 games to Ronin, and Immutable partnered with Ubisoft's Strategic Innovation Lab for a gaming platform.
Many people are wondering if Web3 games will flourish in the next bull market cycle.
What’s New?
Axie Classic: Gold Chests, Grand Tournament Phase 2, and Increased AXP Caps
Arc8 Frosty Season Unveiled: A Gaming Wonderland from December 5th to January 31st
NFL Rivals Unveils Exciting Cold Snap Program
Team Liquid and Illuvium Join Forces for NFT Game and Esports Domination
Portal Platform offers unified access points to games and streamlined transactions whilst the foundation announces Jamie King, co-founder of Rockstar Games joining its advisory board
Aether Games is launched on the Excelsior platform allowing unique vetted early-stage opportunities before public listings
Epic Games Store and Immutable a powerhouse of a partnership,
Spindl the Web3 marketing tracking platform partners with AppsFlyer to enhance blockchain gaming analytics
Gods Unchained is now accessible on Amazon Prime Gaming, making it easier for new players to join.
🔮 @GodsUnchained is officially on @primegaming!
Onboarding new players has never been easier, and you can now claim monthly exclusive in-game items through the Prime Gaming platform.
gaming.amazon.com/rare-pack-bund…
— Immutable (@Immutable)
5:27 PM • Dec 5, 2023
Web3 Game Chains
When it comes to sheer numbers of games, the classic BNB Chain, Ethereum, and Polygon continue to lead the pack with 964, 781, and 479 games respectively.
However, the landscape is not stagnant, and new blockchains are emerging, bringing excitement and anticipation to the future of web3 gaming. Notable newcomers include South Korea's Layer2 blockchain, Kroma Network, and Chromia, which plans to launch its mainnet in 2024, TreasureDAO is also building its game blockchain.
Over the past five months, the overall transaction volume in the gaming sector has witnessed a consistent decline. Taking a closer look at the data, the significant drop in transactions on the Wax blockchain, particularly in the case of Alien Worlds, is quite evident. In comparison to October, there has been a staggering decrease of 89 million transactions.
Total gaming transactions have been declining for the past five months. However, if we look at the market share of transactions, Solana shows promising growth, reaching 13.6%, a significant increase from its share of only 4.2% in October.
Ronin certainly had a remarkable performance in November, with its trading volume capturing a significant 21% market share.
In particular, the platform's daily active users (DAU) started November at 15,964 and jumped to an impressive 147,101 by the end of the month, representing an astounding 821% growth and reaching a substantial total of 153,000 users. This extraordinary growth is mainly due to the integration of Pixels into the Ronin network.
Pixels is Live on Ronin Network
Pixels is an interoperable web3 farming game, and the team places a strong emphasis on the power of its community, valuing its large user base on the Ronin blockchain. In a recent announcement, Pixels stated, "At Pixels, our community has always been our driving force. With Ronin's track record of onboarding more Web3 users than any other blockchain, we're excited to have an even more vibrant and connected community.
Games Overview
In November, there was a slight increase in the number of active games (with at least one player with smart contracts). The total number reached 2,708.
The month of November witnessed notable spikes in trading volume on November 9th and November 27th. On November 9th, the surge in trading volume was primarily attributed to ImmutableX's official behavior. On November 27th was driven by Axie Infinity, marking an impressive 203.56% increase compared to the previous day.
Axie Infinity has been consistently actively building and expanding its ecosystem. On November 24th, Axie Infinity introduced an NFT monetization solution and launched the Axie Merch Store.
When we examine the intersection between the top-performing tokens in November and the top-performing games over the past three months. This intersection revealed games that not only experienced significant price spikes in November but also maintained robust price stability over 3 months. These standout projects include Imperium Empires, Gamee, Bulliverse, Chain Games, and DeFiLand.
As the number one gaming platform on Telegram, Gamee recorded an astounding 1,241.71% growth this month.
Chain Games, currently ranked sixth in terms of monthly price growth, maintains its position as the sixth best-performing token in terms of annual price growth with an impressive 277.6% increase. This continued success highlights the enduring appeal and strength of Chain Games in the crypto market landscape.
Game Investment and Funding
Engaging in Web3 gaming has necessitated more research and caution during the bear market.
Despite these challenges, Animoca Brands has emerged as one of the most active companies in the investment and funding landscape this month. The company secured a significant $50 million in funding from Neom Company, a smart city project owned by the Public Investment Fund of Saudi Arabia. Animoca Brands also invested in the Web3 multimedia platform Poglin and provided strategic support to UAE-based gaming startup Farcana.
Three notable projects secured significant investment this month. Bazooka Tango secured $5 million to develop Shardbound, EthXY closed a pre-seed round Matr1x Fire game studio raised $10 million for its NFT mobile shooter, and The Citadel raised $3.3 million in a seed round led by 1kx.
In addition to game projects, there's been a surge in investments supporting game platforms, with growing investment interest in game-related platforms and technologies. Saga secured a $5 million seed extension, while Atlas, a 3D generative AI platform, emerged with a $6 million investment for virtual world-building, and Artifact Lab received $2 million in pre-seed funding.
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Top OpBNB NFT Games by Market Cap 2023
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See you same place same time next week!
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ChainPlay team