Talk about unfortunate timing. If released six or so weeks ago, Coingecko’s research which states “Is GameFi Dead? 3 in 4 Projects Have Failed” could have been a strong debating point.
Now, however, it feels like a footnote in the shadow of growing market confidence.
Still, as a piece of research, it’s interesting to those of us deep into the data.
In conjunction with Footprint Analytics, Coingecko tracked 2,817 web3 games that were launched between 2018 and 2023 and labelled them failed or inactive “when their 14-day moving average number of active users fell by 99% or more from peak”.
It’s slightly weird that as a token tracking site Coingecko didn’t look at token prices, but that aside, using onchain activity seems like a reasonable measure.
And the result that less than 20% of launched web3 game are labelled “active” feels like the right sort of proportion. If nothing else, it is very pareto.
However, it is worth pointing out that using this method would define Axie Infinity — down from over a million daily active unique wallets to under 10,000 — as an inactive project, which obviously isn’t the case.
Probably it would have been better to use an absolute measure: any game with less than 100 DAUWs can be considered inactive. Maybe the ceiling could be as high as 1,000?
Even today, DappRadar only lists 63 games with more than 1,000 DAUWs, which rises to a mere 109 projects with more than 1,000 MAUWs.
DappRadar lists 2,512 games in total so the success rate on that basis would be 2.5% and 4.3% respectively.
Still, both ratios are more positive than my own radical view — with which I’ve often bored you — that in the long term 99.9% of blockchain games will trend to zero, with only the inverse trending to something higher.
And that would still be a massive success for the sector, in my opinion.
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Calendar
ZBD’s 0.5 BTC-reward tournament for Splitgate launches — 10th December
Genesis mint for Overworld; priced 0.15 ETH — 15th December
Shrapnel launches early access — TBA December
Champions Tactics’ The Warlord mint — TBA December
Funding news
Endless Clouds , the developer of blockchain games Treeverse and Capsule Heroes has announced a $2.5 million funding round. The round was led by Animoca Brands, with the likes of Momentum 6, Citizen Capital, GameFi Ventures, SkyVision Capital and 2 Punks Capital all chipping in.
There were also a lot of angels involved, including Gabby Dizon (YGG), Jeff Zirlin (Sky Mavis), Luca Netz (Pudgy Penguins) and Luke Barwikowski (Pixels).
Thing To Watch news
As the public piles into the bull, one thing to watch is do existing projects breakthrough their previous all-time-highs? Bitcoin’s $69,000 and Ethereum’s $4,878 are the obvious headlines but what will be more interesting is whether any of the 2021/22-era blockchain game tokens can do so?
It will be a tall order because unlike the two-thirds top-to-bottom declines of BTC and ETH, many of these token were down >95%, meaning they will have to rise >2,000% to do so. Can AXS break $165 from its current level of $7? As bullish as I am on that project, it’s unlikely.
Despite being buried at least twice by cultural commentators, however, NFTs are more likely the sector to watch. Not gaming but Pudgy Penguins previously peaked at around 6 ETH in January 2023 but the floor is currently 10 ETH ($22,000), up 70% in the past week.
Of course, there aren’t that many gaming projects with solid NFT collections from 2021/22; Axie’s Mystics and Lands probably remain the obvious lodestones.
However, we are starting to see some impressive value accumulation from projects which minted assets in the past 12-to-18 months. Wildcard’s Genesis Wildpasses are one of the best performers up 2,500% from their mint price, currently with a floor of $1,100.
This compares to rises of mere hundreds of percent for the like of Shrapnel’s Operators and Azra’s The Hopeful. Certainly it’s on the up but DigiDaigaku is still down <50% from all-time-highs, while The Sandbox floor remains moribund, down 90%.
The likely moral of the story in the coming months is that the falling tide compressed everything in rough proportion, while a rising tide will float all ships — just not very equally.
Additional Links
Big Time just sold out $2 million of mystery boxes (again).
Is The Sandbox gearing up for a mobile release?
Best known for My Neighbor Alice, the Chromia blockchain will launch its mainnet in early 2024.
Spanish dev Freeverse has announced its Polkadot-based cross-chain minting infra LAOS.
Lamina1 is dropping 5 million betanet tokens.
Japanese game developer Gumi is now a validator for Com2uS’ XPLA blockchain.
AppsFlyer has partnered with Spindl to “combine web2 and web3 game marketing analytics”.
Check out Nine Chronicles M using my referral code.