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Author: lesley@footprint.network
Key Takeaways
Web3 Game has over 800 thousand people playing it every day, even when the market is bad.
Web3 game is evolving, from GameFi emerged from DeFi, X2E enhanced narratives to AAA games and metaverse experiences.
In the future, GameFi needs unified consensus and protocols to better connect projects and ecosystems.
The market is getting a bit better these days! Web3 Game, also known as blockchain-based games, is one of the most fascinating areas in crypto today, with more projects emerging in the market.
While economic incentives have attracted many to GameFi in its early stages, a significant percentage of players remain primarily motivated by the gaming experience and community. Understanding how and why different users engage with GameFi reveals key trends that will shape its future.
As mainstream audiences become increasingly receptive to new forms of interactive and immersive entertainment, GameFi has significant growth potential. This article examines how GameFi is evolving by analyzing the dominant genres that have emerged and the motivations that drive different user segments, as well as the number and profile of users of each type.
Web3 games are an evolution of gaming built on the decentralized, peer-to-peer architecture of blockchain technology.
While the concept of making money from gameplay is not new, GameFi represents a paradigm shift in terms of user ownership and control of the gaming ecosystem. Players own in-game assets outright as non-fungible tokens (NFTs) or crypto tokens and can trade or sell them freely.
Web3 games are in a period of rapid development and represent the future of the gaming industry. While concepts such as open metaverses are still in their infancy, they have already demonstrated the potential of Web3 games and how blockchain and crypto can enable entirely new interactive gaming experiences. There are good reasons to remain optimistic about the industry’s growth prospects for Web3 games as they move from a new niche to mainstream adoption.
Over 800 thousand people play Web3 Game every day, even when the market is bad.
Because there are so many different ways to interact with games for different purposes, Web3 Game consumers can be difficult to categorize. While some platforms base their decisions on the number of unique wallet addresses, this measure misses the subtleties of who is actively playing a game and why.
Many people are drawn to games for a variety of reasons, including actual gamers looking for entertainment, investors hoping to make money, bot accounts gaming the system, and more. In order to assess the health and potential of GameFi protocols, it is essential to understand the motivations and behaviors of users across different sectors.
In addition, Web3 gamers tend to be younger, better educated and more technologically sophisticated than regular gamers. The average regular gamer is 35 years old, but the average Web3 gamer is between 25 and 30 years old.
GameFi grew out of DeFi in its early stages, combining DeFi’s asset allocation principles with gaming elements. The early stages of GameFi were primarily focused on using DeFi principles as a framework, rather than truly integrating them into the gameplay itself.
The primary goal of early GameFi projects was to attract users who were interested in making a quick profit, rather than creating a truly immersive gaming experience. As a result, the game design and graphics lacked the depth and complexity of traditional games, resulting in a poor user experience.
Axie Infinity Daily Active Users
However, currently, according to Footprint Analytics, Axie Infinity has entered a stagnation period, with only about 9,000 daily active usAxie Infinity Monthly Retention Rateers compared to millions of active users during its peak.
Axie Infinity Weekly Retention Rate
User retention rate is also an important metric in user analysis, as it shows how many users are being retained by the project at a given stage. It can indicate whether the project is valuable and how many users are willing to become active users. Axie Infinity’s primary user group is focused on making a profit rather than the game itself. This creates a “play-to-earn” dynamic where players are primarily motivated by the potential for financial gain rather than the enjoyment of the game, resulting in a lower retention rate of around 10%.
To develop a successful GameFi ecosystem, it is necessary to go beyond the basic principles of DeFi and explore creative ways of integrating it into the game. This includes developing unique and complex in-game economies, innovative monetisation models using blockchain technology, and prioritising user experience in game design.
Despite this, early GameFi games introduced some innovative gameplay mechanics such as breeding and battling, although these were relatively basic compared to traditional games. However, they provided a glimpse of the potential for GameFi to become a successful gaming ecosystem if paired with engaging gameplay mechanics.
X2E products often use meaningful real-life activities or creative behaviours as the core gameplay mechanism. Unlike early-stage games that are purely profit-driven, X2E places a high value on community culture and values. For example, STEPN not only promotes healthy lifestyles through sports, but also engages in charitable activities through the STEPN Foundation.
STEPN gamifies real-life behaviours through sport, making the game mechanism more user-friendly and with greater potential for long-term player engagement. The design of the game encourages users to participate in physical activities, meet specific goals and submit proof of completion through the STEPN application. The game rewards users for their efforts, motivating them to continue the habit of healthy activity.
During the active period from March 2022, the monthly retention rate of STEPN can reach up to 30%. This is due to the fact that STEPN places great emphasis on building a community culture and values, which has attracted users with span social attributes and interactive needs.
In order to increase the game’s penetration, STEPN needs to further improve its game mechanics and user interface to create a more engaging and interactive experience. By providing users with a more meaningful and rewarding gaming experience, STEP N can foster a sense of loyalty and help build a more robust user base.
During the active period from March 2022, the monthly retention rate of STEPN can reach up to 30%. This is due to STEPN’s emphasis on building a community culture and values, which has attracted users with span social attributes and interactive needs.
However, the significant increase in shoe prices has led to a surge in sales pressure, which may put STEPN at risk if not enough new users enter the ecosystem.
AAA games have a reputation for high-quality graphics, rich content, and superior player experience, which can significantly elevate the quality of Web3 games. The involvement of AAA game studios and capital can also bring valuable resources and expertise to Web3 gaming, further driving its popularity and growth.
Illuvium is a GameFi project of the highest level, which gives it an inherent edge in terms of the quality of its products and the experience it offers its users. Illuvium has gone to great lengths to create stunning 3D environments and models that are tailored to different player demographics. Its mouse and keyboard control system is also top-notch, and the game offers an array of PVE and PVP gameplay options. These factors combine to make Illuvium a highly engaging and replayable game.
Despite performing better than other games during bear markets, according to Footprint Analytics, Illuvium has maintained a relatively low level of daily active users (hundreds of users). This can be attributed to the fact that the platform has a smaller total number of users who are heavily involved in GameFi.
Illuvium Weekly Retention Analysis
Also, to address the low retention rate, Illuvium needs to optimize its player recall mechanism. The platform’s beautiful game graphics and span team background alone are not enough to retain users.
By enhancing user engagement measures and improving user experience, Illuvium could further elevate its profile and influence in the market, potentially attracting new users who appreciate a more immersive gaming experience.
According to Report Linker, the global metaverse gaming market is expected to reach $447.8 billion by 2027, growing at a compound annual growth rate (CAGR) of 15.3% from 2020 to 2027. This growth will be driven by factors such as increased internet penetration, the growing prevalence of smartphones and mobile gaming, and the increasing popularity of virtual reality and virtual worlds.
The metaverse and virtual world represent an inevitable trend and direction for the development of blockchain technology and GameFi. It will create a persistent and open digital space for users to experience various entertainment and social activities. This will undoubtedly become an important part of users’ digital life in the Web3 era.
At present, however, the metaverse and the virtual world are still at the conceptual stage. Although early products such as Decentraland and Sandbox have been launched, there is still much room for improvement in terms of openness, community activity and degree of commercialisation. This requires continuous optimisation and enrichment of the content by the community and the project parties in order to attract more users and capital.
GameFi 1.0 proved the difference in player attributes between Web 2 and Web 3. The project needs to absorb the previous speculation through internal circulation, rather than relying solely on the external circulation mode.
Currently, the playability of most GameFi projects is still insufficient, and the technology has not reflected the advantages of blockchain. To build a transitional GameFi model, we need to start from the perspective of Web3 users and economic models.
GameFi needs more unified consensus and protocols to better connect different projects and ecosystems. As different projects develop, standardised protocols and frameworks need to be established so that game developers can more efficiently achieve cross-platform transactions, game composition and interaction.
The future of GameFi requires more research into game content, gameplay and graphics. A span background would be beneficial to project development, and maintaining community consensus is essential to extending the game life cycle.
This piece is contributed by Footprint Analytics community.
The Footprint Community is a place where data and crypto enthusiasts worldwide help each other understand and gain insights about Web3, the metaverse, DeFi, GameFi, or any other area of the fledgling world of blockchain. Here you’ll find active, diverse voices supporting each other and driving the community forward.
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