Proper now, my X feed is stuffed with people who find themselves giving up on Web3 gaming. I get it. Over $12 billion of enterprise capital funding has gone into it since 2020 and so they haven’t seen the form of breakout success that many anticipated. Even the very best video games haven’t reached something near mainstream scale. Token costs are down. Studios are shutting down. And everyone seems to be exhausted.
However measuring Web3 gaming by token costs alone is like calling the web a failure due to the dot-com crash — it ignores how far the know-how has come and the place it is headed. It’s lacking the actual story.
At its core, Web3 gaming is about giving gamers actual possession — not simply of the in-game gadgets that they purchase and earn, but additionally their identities and achievements. In conventional video games, gamers make investments time, effort and cash into digital property that in the end belong to the writer. Web3 adjustments that. By placing property on-chain, gamers can actually personal what they earn—whether or not that’s tradable gadgets like weapons or land, or non-transferable badges of fame, guild historical past, or verifiable talent. It’s not nearly shopping for and promoting stuff — it’s about company, persistence, and getting correct recognition for what you’ve constructed and what’s actually yours within the ecosystem.
The idea isn’t new. Gamers have needed extra management over their in-game property for years. Take a look at the huge markets for CS:GO skins or World of Warcraft gold. However till now, these economies have been fragmented, restricted, or prone to being shut down if a centralized writer decides to close it down or change the principles. Web3 makes these economies open, interoperable, player-owned and player-driven.
Possession has at all times been the inspiration of Web3 gaming, and play-to-earn was an experimental mannequin that confirmed the potential for open and permissionless digital economies on blockchain. Now, the business is evolving with a stronger deal with sustainable economies and higher tokenomics, deeper gameplay, and long-term participant engagement.
However if you happen to’re evaluating Web3 gaming to Web2 gaming, you’ll be upset. Conventional gaming has had many years to fine-tune recreation design, construct large participant bases, and develop enterprise fashions that work, whereas Web3 gaming remains to be in its experimental section. Certain, billions of {dollars} of funding can velocity issues up, however throwing cash at a model new class doesn’t magically purchase it a monitor document or immediately create new video games that folks love.
I’ve been making video games for over 20 years and I’ve seen each main shift get dismissed earlier than it took over. No one believed cellular gaming may compete with PCs or consoles till it turned greater than each. Free-to-play was known as a rip-off till it made extra money and reached extra gamers than ever earlier than. Esports was a joke till stadiums bought out and prize swimming pools hit thousands and thousands. Digital skins have been “nugatory” earlier than they turned a multi-billion greenback market.
And now, Web3 gaming is at that very same inflection level.
After I first heard about blockchain in 2018, everybody I knew in FinTech was speaking about it. So in fact I believed it was boring and I ignored it. It wasn’t till I discovered about CryptoKitties that I truly took discover. After I noticed individuals accumulating, buying and selling and really proudly owning these cute on-chain cats, that’s after I acquired excited as a result of I knew they weren’t like different in-game property. CryptoKitties have been digital issues that nobody may take away from you. As somebody who’s spent their life grinding in video games, and their profession convincing others to grind the identical — with out actually getting something for it — that concept of digital possession gave me a complete new option to suppose.
So I went all-in on blockchain video games. However 2018 and 2019 have been actually robust instances. Just about nobody else cared again then. There was no help, no actual funding, no clear concept of what these video games might be past hypothesis, and (exterior of a handful of believers) there was little or no conviction. The market was in a deep bear cycle, and lots of groups both gave up or ran out of cash earlier than they may launch. Nonetheless, a few of us stored constructing. We stayed lean, experimented, and discovered all the pieces the exhausting manner. It feels equally dangerous now, however not as dangerous because it was then. Trying again, I’m so glad we didn’t pack it in when success was simply across the nook.
When Axie Infinity broke by way of in 2021, all the pieces modified. Web3 founders like Jeffrey “Jihoz” Zirlin of Sky Mavis, Yat Siu of Animoca Manufacturers, Sebastien Borget of The Sandbox, and me, went from being known as loopy to visionary in a single day. Immediately, we have been talking on the primary stage at conferences the place we used to observe within the viewers. We made information headlines and “Most Influential” lists. Buyers who ignored our emails have been asking how a lot they may put in. My e-mail inbox stuffed up with fundraising decks pitching the subsequent YGG.
Then in 2022, the market crashed, and simply as shortly, we went again to being loopy. However that by no means actually bothered me as a result of loopy individuals are those who make large issues occur.
Now, everybody’s asking: When is the subsequent large Web3 recreation? The reply is that this: good video games take time. And if you happen to look previous the pink candles to take discover of what exists already at the moment, you’ll see we how a lot progress we’ve made since our business was seeded in 2018:
- In 2020, Axie Infinity had fewer than 500 day by day gamers. In the present day, Ronin — the blockchain it constructed — has thousands and thousands of lively customers, with 17 new video games launched, and 134% development in NFT buying and selling quantity in 2024 in comparison with 2023. It’s additionally gone permissionless, which suggests there can be extra video games, quicker improvement, stronger community results, and unpredictably large breakthroughs. A number of the largest improvements in gaming like modding, free-to-play and esports got here from sudden locations. By decreasing the barrier to entry, a permissionless Ronin invitations the sort of experimentation that might result in the subsequent Axie-scale success.
- Pixels, a farming recreation on Ronin, hit a peak of 1.3 million day by day lively customers (DAUs) and is holding robust now with round 250,000 DAUs even with its token down 96%. Gamers are spending greater than they money out, shopping for land, upgrading property, and really placing a refund into the sport, fueling the economic system as a substitute of extracting from it. That is how digital economies ought to work, with actual demand and powerful retention. Most significantly, it is a sign that the play-to-earn mannequin can work if accomplished proper.
- Parallel, a buying and selling card recreation (TCG) on Ethereum, simply hosted a world championship in Las Vegas on the HyperX Area — a venue that has hosted among the largest esports competitions from “League of Legends All-Stars” to “Avenue Fighter V’s Capcom Cup.” This was a prestigious occasion that noticed among the world’s greatest TCG gamers crossover from conventional titles like Hearthstone to grow to be among the first Web3 esports legends.
These are just some examples, however they present the sort of traction we’re seeing: higher infrastructure, rising communities, extra sustainable digital economies, digital possession.
Those that FUD Web3 gaming at the moment don’t perceive it. They missed CryptoKitties in 2018, Axie in 2020, YGG in 2021, and so they’ll miss the subsequent wave too as a result of they’re measuring the unsuitable metrics. Web3 is rising and innovating quicker than some other sector in gaming. It’s not time to give up. It is time to double down. Allow them to name us no matter they need: loopy, delusional. Visionary, pioneering. It doesn’t change what we do. We’ve been right here earlier than. Keep the trail.
