Proper now, my X feed is filled 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 they usually haven’t seen the form of breakout success that many anticipated. Even the most effective 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 objects 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 objects like weapons or land, or non-transferable badges of status, 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 wished extra management over their in-game property for years. Have a look at the large markets for CS:GO skins or World of Warcraft gold. However till now, these economies have been fragmented, restricted, or vulnerable 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 all the time been the muse 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 a long time to fine-tune sport design, construct large participant bases, and develop enterprise fashions that work, whereas Web3 gaming remains to be in its experimental section. Positive, billions of {dollars} of funding can pace issues up, however throwing cash at a model new class doesn’t magically purchase it a monitor file or immediately create new video games that individuals 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 person believed cellular gaming might compete with PCs or consoles till it turned greater than each. Free-to-play was known as a rip-off till it made more cash and reached extra gamers than ever earlier than. Esports was a joke till stadiums offered out and prize swimming pools hit thousands and thousands. Digital skins had been “nugatory” earlier than they turned a multi-billion greenback market.
And now, Web3 gaming is at that very same inflection level.
Once I first heard about blockchain in 2018, everybody I knew in FinTech was speaking about it. So after all I believed it was boring and I ignored it. It wasn’t till I realized about CryptoKitties that I really took discover. Once I noticed folks amassing, buying and selling and really proudly owning these cute on-chain cats, that’s once I acquired excited as a result of I knew they weren’t like different in-game property. CryptoKitties had been digital issues that nobody might 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 technique to suppose.
So I went all-in on blockchain video games. However 2018 and 2019 had been actually powerful occasions. Just about nobody else cared again then. There was no help, no actual funding, no clear thought of what these video games could possibly be past hypothesis, and (outdoors of a handful of believers) there was little or no conviction. The market was in a deep bear cycle, and plenty of groups both gave up or ran out of cash earlier than they might launch. Nonetheless, a few of us stored constructing. We stayed lean, experimented, and realized every part the laborious means. It feels equally dangerous now, however not as dangerous because it was then. Wanting again, I’m so glad we didn’t pack it in when success was simply across the nook.
When Axie Infinity broke by in 2021, every part 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. Abruptly, we had been talking on the principle stage at conferences the place we used to observe within the viewers. We made information headlines and “Most Influential” lists. Traders who ignored our emails had been asking how a lot they might put in. My e-mail inbox crammed up with fundraising decks pitching the subsequent YGG.
Then in 2022, the market crashed, and simply as rapidly, 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 sport? 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 right now, 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. Right this moment, Ronin — the blockchain it constructed — has thousands and thousands of energetic 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, sooner 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 reducing the barrier to entry, a permissionless Ronin invitations the sort of experimentation that would result in the subsequent Axie-scale success.
- Pixels, a farming sport on Ronin, hit a peak of 1.3 million day by day energetic customers (DAUs) and is holding sturdy 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 reimbursement into the sport, fueling the economic system as an alternative 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 executed proper.
- Parallel, a buying and selling card sport (TCG) on Ethereum, simply hosted a world championship in Las Vegas on the HyperX Enviornment — 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 turn out to be among the first Web3 esports legends.
These are only a few 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 right now don’t perceive it. They missed CryptoKitties in 2018, Axie in 2020, YGG in 2021, they usually’ll miss the subsequent wave too as a result of they’re measuring the incorrect metrics. Web3 is rising and innovating sooner than another 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.
