Connect with us
SOFTSWISS

Gaming

The Future of GameFi – Why are Firms Still Investing?

Published

on

Reading Time: 5 minutes

 

During a bloody period in the crypto industry when liquidity is drying up, the developers keep on developing, and the investors keep on investing. With all of the turmoil happening around us, it can be difficult to see positive developments happening in the space, one of which is the increasing investments in and the gradual evolution of the blockchain gaming (GameFi) industry.

After the NFT craze of 2021, many metaverse projects saw a dramatic uptick in users and revenue during that time. However, as the bear market has ensued from the start of 2022, the GameFi space has also taken a hit, with many popular Play-to-Earn games reporting record low revenues, as indicated by GameFi NFT trade volumes for Axie Infinity and others.

NFT game trade volume has dropped significantly over the past year (The Block)

Although there are some real challenges to be solved, it’s clear that VCs see beyond short-term hurdles, as is indicated by the accelerated investments in the space. In Q2 of 2022 alone, $2.5 billion was invested in GameFi, indicating a huge leap compared to 2021’s aggregate investment of $4 billion – and this year is still not over!

So then the question needs to be asked – is GameFi dead, or is there true potential for blockchains to revolutionize the gaming industry and absorb at least some of the current $220 billion (and rapidly growing) gaming market?

What is GameFi?

GameFi is a portmanteau of the terms “game” and “decentralized finance,” and it refers to a financial system in which users can earn money by participating in video games. While most play-to-earn projects place emphasis on the “gaming” aspect, the most critical aspect of GameFi at its foundation is “money”. Its beauty lies in the financial opportunities provided by a highly viewed form of entertainment – gaming.

 

While GameFi has shown  a slight decline compared to its popularity earlier in the year, it was definitely the highlight of 2021, growing from 658 projects to over 1,100 projects in one year. The gamification of blockchain made the technology more approachable, appealing and acceptable for the public,

GameFi – Challenges Abound, But So Are Opportunities

Before we discuss the future prospects of GameFi, we have to acknowledge the challenges currently faced in the GameFi sector. For anyone involved in crypto, it won’t come as a surprise to find out that the public perception of GameFi is not great – hostile even. And a good amount of that negativity is not without merit.

Public Image Issues

The biggest challenge by far will be to convince traditional gamers of the underlying true value of NFTs. Not for their perceived and oft-reported highly speculative value, but for their digital scarcity, provable ownership, security and programmability that enables in-game assets to be used far beyond their main purposes. The 2021 NFT Cambrian explosion led to an immense crypto adoption and made a lot of people wealthy. But it also left some pretty big scars after the market cooled down; countless stories of project rug pulls by anonymous operators and celebrities, and NFT newcomers getting scammed are still circulating the news. 

Mainstream gamers still need to be convinced that the web3 space can tackle the challenge of building a self-sustaining game economy. One that gives the players a chance to decide whether they want to play the game for free and for fun, or whether to take it to the next level and earn an income from it.

Free-to-Play – Adjusting Course for the Better

To draw inspiration for how to structure and monetize a game, the web3 gaming industry need not look further for its most ideal strategy than the one that’s been right in front of their eyes for more than a decade – Free-to-Play. Countless titles, such as Candy Crush, Farmville, Roblox, Pokemon GO, League of Legends and many more, have proven to the world that free-to-play games can be highly lucrative without setting up paywalls for their users, sometimes even more so than paywalled games.

The F2P mechanism flips P2E on its head – instead of letting whales hoard all of the in-game assets and generate passive income, F2P games let them bring in 80% of the revenues through Pay-to-Win (P2W), which allows players to pay for in-game advantages. These P2W features are typically low-cost small advantage boosts such as resource packs, gacha characters, healing boosters and more. But in the aggregate, these small payments compound into enormous profits for the game. It works for everyone – most players get to play the game for free, big players get to accelerate their in-game success, and the game itself generates more revenue than it knows what to do with.

And this realization is one of the reasons why more and more investments are flowing into GameFi. Though it had a rocky start, the value proposition of NFT-based games is clear – every single aspect of traditional F2P games is made simpler and safer. In addition, every in-game NFT asset can be added to a highly liquid global market of all NFT assets, offering ways to trade NFTs from different games, as well as build in utility for them in order to grant unique capabilities, access rights, invites and more. And if that’s not enough, on-chain data also shows a clear trend – gaming activity currently accounts for 52% of all Unique Active Wallets (UAW), a 232% increase from last year. The numbers speak for themselves — the opportunity offered by blockchain gaming is immense, and investors are paying attention.

The Path Forward for GameFi – Keeping It Simple

In the past years, the approach taken by many blockchain game projects has been to advertise their games to crypto-natives, typically with the express aim of offering earning opportunities for players. As a result, we’ve mostly gotten games of subpar quality that have served players mainly as profit extraction vehicles with limited long-term sustainability, especially during bear markets when hype and liquidity are low.

This may not be the end of the GameFi sector just yet, however. The newer form of web3 gaming has started to practice patience, build a great, addictive game, and quietly build all of the exciting and innovative web3 features into the backend of the game without making too much fuss about it. The industry is steering away from P2E, embracing Free-to-Play with Pay-to-Win as a sustainable means of monetization. Attracting talent from traditional gaming and finally forcing large game studios to build blockchain tech into their backends are all crucial pathways to making a blockchain-based gaming future a reality.

However, these great leaps will not happen out of thin air — a lot of capital will need to be deployed over many years. Luckily, companies such as Immutable X, the NFT-gaming optimized Ethereum L2 startup, have launched a $500 million development fund to invest in GameFi. Solana Ventures has also amassed a $100 million fund to invest in GameFi and DeFi targeting South Korea. And they’re not alone. More than $10 billion is expected to flow into GameFi this year alone. 

The amount of capital invested perfectly demonstrates the potential these firms see in the upcoming, more improved version of GameFi. With this amount of capital, and GameFi’s tendency to revamp, improve and further develop its new generation of play-to-earn games, it’s a matter of when, not if, blockchain gaming will become the norm in the future.

 

Written by Boxmining

Gaming

New SuperScale eBook Launched to Help Mobile Game Developers Maximise Organic Success

Published

on

Reading Time: < 1 minute

 

SuperScale has released its latest ebook “From organic success to long-term revenue,” which addresses the concerns and opportunities identified in SuperScale’s landmark study, “Good Games Don’t Die”. The new SuperScale ebook builds on the signature whitepaper, providing mobile game developers with actionable insights and strategies to implement when a game gains organic traction.

Organic strategies such as celebrity endorsement, streamer coverage and TikTok virality can quickly catapult a game to the top of the charts, but it can be a challenge to maintain popularity. As discovered in the Good Games Don’t Die Report, 76% of launched games hit peak revenue and 47% of games die in year 1. The ebook provides developers with advice to further maximize the long-term revenue of games that have generated organic successes to date.

Previous findings also revealed that over a quarter (26%) of developers do not measure the lifetime value (LTV) and return on ad spend (ROAS) for their games. The ebook offers insights for developers exploring LTV and ROAS for the first time, alongside the significance of factors such as seasonality and marketing to seasoned game-makers. As discovered in the Good Games Don’t Die report, only 41% of developers use Ad mediation platforms. Inside the ebook, SuperScale specialists explain this process, offering advice about picking the right network, and the bidding and waterfall optimisation processes.

Ivan Trancik, CEO and Founder of SuperScale, said: “The findings from the Good Games Don’t Die white paper have been read far and wide by the industry. We’ve delved into the data to deliver an ebook that addresses the opportunities some developers are not currently exploring. In today’s mobile gaming landscape, every revenue-making opportunity counts, so we’re giving developers the insights to take their organic success to the next level.”

Continue Reading

Gaming

Gaming Corps boosts Smash4Cash™ offering with release of RAMPAGE!

Published

on

Reading Time: 2 minutes

Gaming Corps – a publicly-listed game development company based in Sweden – is giving players the chance to swing wildly and bring the riches home in new game RAMPAGE!

Players can put their luck to the test and crack open ball after ball, revealing marvellous prizes hidden within.

RAMPAGE! is the second game in Gaming Corps’ Smash4Cash™ series, following the release of Piggy Smash in January. The Smah4Cash™ mechanic is designed to make the game experience even more unique and bring an even greater chance for players to make the most of bonus rounds.

Each time a player wagers on RAMPAGE! they make an attempt to smash a single active ball laid out in the middle of the game screen. There are two racks, with one on each side of the active ball, each holding four balls.

If the ball is smashed, the player will be rewarded with an instant prize, and one of several features may also be awarded. After a ball is smashed, it will be replaced with a new ball that drops from the rack, becoming active.

A ball being smashed may activate the MULTIPLIER feature, which will apply to the payout of the next ball that will be smashed. The next ball is automatically made active and is a guaranteed smash.

What’s more for players is the RAMPAGE feature could also be activated. The game will enter RAMPAGE MODE, where the Hammer automatically attempts to smash balls until it fails. A minimum of two balls will be smashed in this feature.

Even more winnings can be claimed if the MULTIPLIER RAMPAGE feature is triggered, combining both the MULTIPLIER and RAMPAGE features. During this feature, all smashed balls will have their payouts multiplied by the awarded multiplier at the start of the feature.

That’s not all, as players can also win a random prize if the INSTANT WIN feature is triggered. The game will award a random prize of 10x, 25x, 100x or 1000x the bet.

Connor Blinman, Head of Games at Gaming Corps said: “Our Smash4Cash™ mechanic is giving players even more opportunities to make the most of our thrilling games, and following the successful release of Piggy Smash, I’m very thankful to our team for smashing it out the park with our latest game to use the mechanic, RAMPAGE!

“This won’t be the last you will be hearing from us with releases like this, and I really look forward to seeing how we can make our games even stronger through the use of this mechanic in the coming months.”

Continue Reading

Gaming

THE BATTLE OF POLYTOPIA ARRIVES ON APPLE ARCADE

Published

on

Reading Time: < 1 minute

 

The award-winning 4x strategy game The Battle of Polytopia has joined Apple Arcade as a ‘plus’ version with all tribes and skins unlocked.

In The Battle of Polytopia, tribes offer new units, technology, and buildings for players to enjoy as they seek to gain the highest score or defeat their opponent in the turn-based game. Apple Arcade users can have instant access to all 16 Polytopia tribes without needing to buy them separately as DLC.

The game has already been enjoyed by more than 20 million users on mobile, Steam and Switch and has a string of high-profile fans including Deepmind´s CEO Demis Hassabis and MrBeast. The standard version of the game will remain available on the App Store.

Christian Lövstedt, General Manager for The Battle of Polytopia, commented:

“The Apple Arcade release of The Battle of Polytopia will make the game available for even more players to enjoy. Whether it’s the unique insect abilities of the Cymanti, or the icy powers of the Polaris, the special tribes of Polytopia each offer a new spin on gameplay. By making all 16 tribes available, players can enjoy everything Polytopia has to offer from the very start.”

As initially announced by Apple Arcade, The Battle of Polytopia joins Bloons TD Battles 2+ and Crayola Adventures as new additions to the subscription service.

 

Continue Reading
Advertisement
Alpha Affiliates
Advertisement

EveryMatrix

Advertisement

Launch your iGaming business swiftly and effortlessly with our comprehensive turnkey solutions

Trending

Get it on Google Play

EuropeanGaming.eu is a premier online platform that serves as a leading information hub for the gaming and gambling industry. This industry-centric media outlet reaches over 200,000 readers monthly, providing them with compelling content, the latest news, and deep-dive insights.

Offering comprehensive coverage on all aspects of the gaming sector, EuropeanGaming.eu includes online and land-based gaming, betting, esports, regulatory and compliance updates, and technological advancements. Regular features encompass daily news articles, press releases, exclusive interviews, and insightful event reports.

The platform also hosts industry-relevant virtual meetups and conferences, and provides detailed reports, making it a one-stop resource for anyone seeking information about operators, suppliers, regulators, and professional services in the European gaming market. The portal's primary goal is to keep its extensive reader base updated on the latest happenings, trends, and developments within the gaming and gambling sector, with an emphasis on the European market while also covering pertinent global news. It's an indispensable resource for gaming professionals, operators, and enthusiasts alike.

Contact us: [email protected]

Editorial / PR Submissions: [email protected]

Copyright © 2015 - 2024 - European Gaming is part of HIPTHER. Registered in Romania under Proshirt SRL, Company number: 2134306, EU VAT ID: RO21343605. Office address: Blvd. 1 Decembrie 1918 nr.5, Targu Mures, Romania

We are constantly showing banners about important news regarding events and product launches. Please turn AdBlock off in order to see these areas.