The Current Sentiment in Web3 Gaming
It’s hard to ignore the growing disillusionment surrounding Web3 gaming. My social media feeds are filled with voices expressing their frustrations and giving up hope. Since 2020, over $12 billion in venture capital has flowed into this space, yet many anticipated a breakout success that hasn’t materialized. Despite the efforts of several studios, even the most promising games struggle to achieve mainstream recognition. Token prices have plummeted, studios are closing their doors, and the gaming community is feeling fatigued.
Understanding the Bigger Picture
However, evaluating Web3 gaming solely through the lens of token prices is akin to dismissing the entire internet following the dot-com crash. Such a narrow perspective overlooks the significant advancements in technology and the potential that lies ahead. The true narrative of Web3 gaming is much richer and more complex.
At its essence, Web3 gaming empowers players with genuine ownership—not just of in-game items they acquire but also of their identities and achievements. In traditional gaming, players invest substantial time, effort, and money into digital assets that ultimately belong to the publisher. Web3 disrupts this paradigm by allowing players to put their assets on-chain, granting them actual ownership over items like weapons, land, and unique badges of reputation or skill. This shift is not merely about buying and selling; it’s about fostering agency, persistence, and rightful recognition within the ecosystem.
The Evolution of Player Ownership
The desire for greater control over in-game assets has long been a staple of player sentiment. Consider the thriving markets for CS:GO skins or World of Warcraft gold, where players have sought to establish ownership. However, those economies have typically been fragmented and vulnerable to the whims of centralized publishers. Web3 changes the game by creating open, interoperable, and player-driven economies.
Ownership has always been a cornerstone of Web3 gaming. The play-to-earn model was an early experiment that demonstrated the potential for open and permissionless virtual economies on the blockchain. Today, the industry is transitioning towards sustainable economies, improved tokenomics, deeper gameplay experiences, and enhanced long-term player engagement.
A New Perspective on Web3 Gaming
If you compare Web3 gaming to its Web2 counterpart, disappointment is inevitable. Traditional gaming has had decades to refine game design, cultivate massive player bases, and develop successful business models. In contrast, Web3 gaming is still in its experimental stages. While significant investments can accelerate development, pouring money into a nascent category does not guarantee immediate success or the creation of beloved games.
Lessons from the Past
Having spent over two decades in game development, I’ve witnessed various industry shifts being dismissed before they became mainstream. Mobile gaming was once considered a non-competitor to PCs and consoles until it surpassed both in popularity. Free-to-play was labeled a scam until it generated unprecedented revenue and player engagement. Esports was laughed at until arenas filled to capacity and prize pools soared into the millions. Digital skins were once deemed “worthless,” only to evolve into a multi-billion-dollar market.
Web3 gaming is now at a similar crossroads.
A Personal Journey into Blockchain Gaming
My first exposure to blockchain technology was in 2018 when everyone in FinTech buzzed about it, yet I found it uninteresting and ignored it. That changed when I encountered CryptoKitties, a game that allowed players to collect, trade, and own cute digital cats. This was when I realized the profound implications of true digital ownership. As someone who has spent a lifetime grinding through games without meaningful rewards, the concept of owning digital assets shifted my perspective entirely.
Despite the challenges of 2018 and 2019, when interest was scarce and funding even scarcer, some of us continued to build and innovate. We learned from mistakes and remained committed to our vision. While the current climate may feel daunting, it pales in comparison to those earlier days. Reflecting on that time, I’m grateful we persevered, as success was just around the corner.
The Turning Point: Axie Infinity
The landscape changed dramatically with the emergence of Axie Infinity in 2021. Web3 pioneers like Jeffrey “Jihoz” Zirlin from Sky Mavis, Yat Siu from Animoca Brands, Sebastien Borget from The Sandbox, and I transitioned from being labeled as eccentric to being hailed as visionaries. Suddenly, we found ourselves on stage at conferences, making headlines, and attracting investment interest from those who had previously overlooked us.
But in 2022, as the market faced a downturn, we returned to being called crazy. Yet, I’ve learned that it’s often the “crazy” individuals who drive significant change.
The Quest for the Next Big Web3 Game
Today, many are eagerly asking when the next big Web3 game will emerge. The reality is that creating exceptional games requires time and dedication. If we look beyond the declining token values, we can see how far we’ve come since 2018.
For instance, Axie Infinity had fewer than 500 daily players in 2020. Now, its blockchain, Ronin, boasts millions of active users, 17 new games, and a 134% increase in NFT trading volume projected for 2024 compared to the previous year. The transition to a permissionless environment will foster faster development, greater network effects, and potentially groundbreaking innovations. Historical trends in gaming, such as modding, free-to-play, and esports, have often emerged from unexpected sources. The permissionless nature of Ronin encourages experimentation that could lead to the next major success story.
Examples of Success in the Web3 Space
Consider Pixels, a farming game on Ronin, which peaked at 1.3 million daily active users (DAUs) and maintains around 250,000 DAUs despite a token decline of 96%. Players are investing more in the game than they cash out, purchasing land and upgrading assets, which fuels the in-game economy rather than draining it. This exemplifies how virtual economies can thrive with genuine demand and player retention, indicating that the play-to-earn model can succeed when executed effectively.
Furthermore, Parallel, a trading card game on Ethereum, recently hosted a world championship in Las Vegas at the renowned HyperX Arena, a venue known for significant esports events. This championship attracted top players from traditional card games like Hearthstone, marking a significant milestone for Web3 esports.
A Promising Future Ahead
These examples highlight the traction Web3 gaming is gaining, with improved infrastructure, expanding communities, and more sustainable virtual economies. Those who criticize Web3 gaming today may not fully grasp its potential. They missed the waves created by CryptoKitties in 2018, Axie in 2020, and YGG in 2021, and they risk missing the next surge as they focus on the wrong metrics. Web3 is evolving and innovating faster than any other sector in gaming.
Now is not the time to abandon ship; it’s the moment to double down on our commitment to this transformative journey. Let them label us as crazy or delusional; those descriptors do not alter our mission. We’ve faced adversity before, and we will continue to navigate the path forward.
