Crypto gaming tokens have experienced their share of fluctuations in recent years. Due to the recent sluggish market conditions, they have not been performing well. According to data provided by CoinMarketCap, the combined value of tokens within this domain has decreased by 1.6%, now standing at $7.1 billion over the last day, accompanied by a 5% decline in trading volume.
On the other hand, the broader gaming industry has witnessed substantial growth over time, surpassing even the earnings of the film industry in the past. A recent report from K33 research revealed that in 2022, the gaming industry generated $183 billion in revenue, a figure approximately seven times higher than the global movie box office earnings. To put this growth into perspective, the gaming industry’s value was a mere $8 billion back in 2006, representing nearly a 23-fold increase.
Crypto gaming, specifically, has also seen significant growth in recent years, characterized by periods of rapid expansion followed by downturns. In 2021-22, Crabada gained widespread popularity, yielding substantial returns on investment for its users and even dominating the Avalanche network, causing congestion issues.
However, it was later discovered that the increased traffic was not a result of genuine player interest but rather the actions of an alleged 13-year-old prodigy from Harvard and MIT, associated with Cynical Hate DAO, who used bots to manipulate the game. This notorious user also caused the asset’s price to plummet to zero. Consequently, the token has not only experienced a decrease in value but has also witnessed a significant decline in trading volume over the past year.
Crypto-Gaming Synergy: What Lies Ahead in Web3
Other prominent gaming initiatives such as Axis Infinity, The Sandbox, Decentraland, Gala, and Enjin have managed to endure, albeit not without feeling the effects of the crypto winter, which has resulted in substantial reductions in their market capitalization. Research conducted by K33 underscored the notion that crypto games have lacked the engaging quality necessary for their survival and prosperity.
In contrast, the conventional gaming landscape is predominantly governed by well-funded, polished AAA game franchises like PUBG, The Witcher, and GTA, boasting the largest player bases and revenue streams. Conversely, play-to-earn crypto games are fragmented across various blockchain networks, marketplaces, and audiences, lacking a unified community.
Consequently, these projects often find themselves vying for liquidity, with one gaming venture’s success frequently coming at the expense of another’s. Moreover, bridging the divide between Web3 and traditional gaming has remained a challenge within the crypto sphere. However, the situation is gradually evolving. The report highlights a recent surge in investment within the Web3 gaming sector, with a substantial rebound in July resulting in approximately $300 million being infused into the industry. While 37% of this investment was allocated to individual games and metaverse concepts, the remaining 63% was directed towards infrastructure projects.
K33’s DeFi Analyst, David Zimmerman, maintains an optimistic outlook and concludes the report by asserting that he believes crypto gaming is poised for another substantial growth cycle. Even for those skeptical about crypto’s influence on the gaming industry, it is essential to recognize the potential for significant trading opportunities in the future.