How blockchain technology is beginning to transform industries beyond finance
Aron Beierschmitt is CEO and co-founder of game development and R&D studio Laguna Games.
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The first quarter of 2022 was profitable and encouraging for the crypto industry. The value of the global cryptocurrency market reached $1.7 trillion and was projected to double in size from here by 2027.
Crypto was also rising in the public consciousness. The FTX cryptocurrency exchange became a leading sponsor of Major League Baseball while Crypto.com renamed a sports arena in a US$700 million deal and Coin base spent nearly US$14 million on its QR code Super Bowl ad.
Celebrities also started piling on, with Eminem, Snoop Dogg, Martha Stewart, Paris Hilton and Shawn Mendes either launching non-fungible tokens (NFTs) or spending millions on popular NFT profile pictures.
But ultimately, the high never lasts.
The domino effect
Disaster struck the cryptocurrency market on May 7, 2022, when a series of sudden sell-offs of UST, a component of the once-valued $18 billion algorithmic Stablecoin, TerraUSD, triggered a bank run and induced a death spiral for the broader. Terra ecosystem, which hosted the currency. The dollar-pegged asset was de-pegged and was worth $0 by May 12. Then heads began to roll, revealing a series of sub-secured loans and high-risk yield strategies that caused investment firms to crumble under their weight.
While this removed a trillion dollars from the crypto market cap, NFTs and games seemed to continue to see momentum. As of May 2022, over 1.15 million unique active wallets interacted with blockchain games each day, down just 5% from the previous month, showing minimal decline.
Winterproof: NFTs for gaming?
Facing the intrusion of a bear market, USD 2.5 billion was invested in blockchain games during the first quarter of 2022. Solana Ventures created several funds worth over $100 million to grow the gaming sector on its blockchain and Immutable dedicated USD 500 million to games and Web3 development. Recently, Animoca brands completed a $75 million raise at a $5.9 billion valuation to invest in blockchain games.
Despite a 29% decrease in organic sales of NFTs since Q1, gaming NFTs saw a 19% increase in year-over-year sales numbers.
Gaming, GMI?
While there are many signs of optimism to be found in the blockchain gaming markets right now, scaling and retention challenges remain. Simple mechanics like staking and unstaking are not enough to keep players engaged. We can expect blockchain games to grow in complexity, with more depth in both the stories and overall gameplay.
As the games evolve, so will their economies. Since monetization is one of the key metrics to identify a game’s staying power, it is important that blockchain game developers design their tokenomics with this in mind.
IN Crypto unicorns (developed by Laguna Games), for example, players don’t just plant and harvest seeds—they craft new materials in the workshop and buy and sell items in the game’s rainbow market. Over the past three months, Crypto Unicorns has seen players pick up half a million unicorns, craft 130,000 items, and record a quarter of a million marketplace transactions.
While blockchain gaming has become an unexpected haven in the bear market, it’s important to note how these early successes will shape the next generation of gaming.
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Learn more:
– Crypto Plays Least Affected by Bear Market, VC Investments Remain Strong – DappRadar
– How to play Metaverse Games: A Beginner’s Guide to Decentraland
– Top 5 Metaverse Games to Play in 2022
– Top 5 games to make money on Ethereum
– Players play different strategies: Minecraft says no to NFTs, while Square Enix unveils its NFT project
– VC Play-to-Earn Investors Now ‘More Cautious’, Gaming Engagement Still Strong – Animoca Brands
– NFT Play-to-Earn Gaming most popular in India, Hong Kong and UAE, survey findings
– Blockchain Games in 2022: Games to Earn, Gamification, Interoperability and Big Publishers
