KEY POINTS
- April's investments exceeded the figures logged during the second quarter of 2023
- The April figures prove that people now see Web3 games "as a transformative force in the industry": Playnance CTO Roman Levi
- True digital ownership is one of the standout features of blockchain gaming that draws investors, Levi said
Blockchain gaming, a rising subsector in the wider Web3 industry, has been on a roll in recent months, especially in April, when nearly $1 billion in investments flowed into the burgeoning space that has proven it has a place in the vast world of blocks and nodes.
In DappRadar's April 2024 blockchain gaming report that was furnished in partnership with the Blockchain Gaming Alliance, it was revealed that Web3 gaming saw $988 million in investments during the month of April, marking the highest monthly investment flow into the subsector since January 2021.
The report included a chart that showed just how significant the April figures are, considering the first quarter of the year saw slower investment inflows, only reaching a collective $287 million.
"This significant investment surge in April has already exceeded the entire second quarter of 2023, which was the best-performing period of that year with $973 million," the report noted.
Aside from the whopping investment numbers, blockchain gaming also reached an average of 2.9 million daily unique active wallets (duAW), accounting for 28% of the month's total dApp industry activity.
In an exclusive email interview with International Business Times, Roman Levi, the CTO of Playnance, a dedicated GameFi ecosystem running on PlayBlock, the leading Layer 3 blockchain solution on Arbitrum Orbit, shared his excitement about the latest developments in blockchain gaming.
For starters, GameFi and Web3 gaming are close-knit concepts, but are not the same. GameFi, or "Game Finance," is a combination of decentralized finance (DeFi) principles and gaming elements, while Web3 gaming is a broader description of combined blockchain technology and gaming.
For Levi, the huge investment in the blockchain gaming space in April "was incredibly exciting and validating." The dramatic shift in investments indicates that there is a build-up of excitement around new technologies in the space from when investors believed in Web3 gaming's potential in 2021 as driven by the rise of DeFi and nonfungible tokens (NFT).
"This massive influx in cash shows that investors really believe in the future of blockchain gaming. It's clear that this isn't just a fleeting trend; people see Web3 games as a transformative force in the industry," he said.
He said investors are drawn to some of the "standout" features in the sector that ultimately highlight its potential, including "true digital ownership," which gives players an avenue to own, trade, and monetize their cryptocurrencies across various platforms. Investors deem the said asset liquidity that provides true value to in-game achievements and purchases as a huge deal, he said.
The P2E model that allows players to earn real-world value through their in-game activities is another attraction for investors. The engagement that comes with the model, as well as the opening of new revenue streams draw investors who seek profitable opportunities.
Finally, a mix of gaming and finance that integrates liquidity pools, yield farming, and staking appeals to a wide range of investors who want to capitalize on the merging of "these two rapidly expanding fields."
Levi, who is a seasoned crypto specialist with over 15 years of web development experience, believes there is huge potential in GameFi becoming a top subsector in Web3. With GameFi's ability to blend immersive gaming experience with the "economic perks" engraved within DeFi, the GameFi space is bound to expand, especially as more gamers and developers embrace the core principles of Web3 technology. He also noted that gameplay real rewards, partnered with security and transparency offered by blockchain, boosts the engagement and trust of users.
Community trust has been increasing in the past few weeks. In May, Web3 gaming hit a new milestone of over 10 million duAW, marking a 7% spike from the previous month and setting a new all-time high. Gaming dApps led the category, attracting 3.13 million duAW.
For Levi, the surge in financial backing and cutting-edge technology around blockchain gaming, "it's only a matter of time before these fundamentals propel GameFi into its next major wave of innovative products."
Despite the apparent interest of millions of gamers around the world in Web3 gaming, there has yet to be a significant entry by traditional and well-established gaming studios into the market.
Levi believes blockchain gaming developers play a key role in getting gaming titans into the blockchain space. Seamless user experience is first in line, since traditional studios prioritize user engagement and gameplay quality. "Blockchain tech has to evolve to offer smooth integration without compromising these aspects," he noted.
Interoperability between diverse blockchain networks and traditional gaming platforms may also get "old-school studios" into the market if they can easily integrate their existing systems with blockchain solutions that lower the barrier to entry.
🚀 Exciting things are coming from @Playnance! Get ready for new features, more #games, and even better ways to earn and play. Stay tuned for updates! 🌐💰🎮 #DeFi #CryptoGaming $MEME #BlockchainGames #GameFi #CryptoNews $STRK $MATRIX ZKsync $CVX @UP_VS_DOWN_ pic.twitter.com/9oF59u9mAs
— Playnance (@Playnancetech) June 17, 2024
As for Playnance's role in the GameFi space, Levi notes that PlayBlock, which powers the Playnance platform, leverages cutting-edge technologies such as zero-gas solutions, account abstraction, and high-end security features.
"Our platform provides true digital ownership," and aside from the UX perks, Playnance offers economic opportunities for players that boost their engagement and retention. Playnance also actively seeks Web2 collaborations, assisting projects to transition into blockchain gaming through providing infrastructure, tools and other related support for development.
Leo Li, chief growth officer at data-sharing protocol and AI-powered gaming super app, wrote in February that blockchain gaming is now "ready for the mainstream," noting that Web2 gaming is faced with multiple blockades that Web3 gaming can knock down.
Such readiness has been proven by the success story of leading Ethereum Layer 2 solution Immutable's "Guild of Guardians," which logged over one million pre-registered players and continues to gain popularity on Google's Play Store.
Guild of Guardians is the game to play. pic.twitter.com/ShpAHkBZkh
— Immutable (@Immutable) June 14, 2024
In the innovative world of Web3, blockchain gaming developments, including the rise of GameFi, continue to prove that when established sectors are strategically combined with emerging industries, there is potential for meaningful and undeniable growth.
