Solana is drastically reducing TVL, what are they focusing on to develop?

The Solana ecosystem has many differences to attract developers and has a basis for many new breakthroughs. Good infrastructure with low transaction costs is an advantage compared to current layer 2 blockchains.

Solana's Current Situation

From a peak of $77.4 billion in November 2021, Solana 's market capitalization is just over $7.7 billion by March 2023. The total value of the ecosystem's key assets has dropped from $9.3 billion continuously to just over 200. million dollars. 

With a different platform design, Solana faced quite a lot of difficulties in retaining and attracting cash flow. Although the ecosystem has also developed many dapps similar to Ethereum and EVM compatible networks. But it is quite difficult for those dapps to boostraping the way the leading ecosystems with strong network effects can. 

The ecosystem's NFT trading volume doesn't have much of a breakout. The largest NFT exchange Magic Eden has also switched from focusing on Solana to supporting multiple chains. One of the popular collections on Solana is Degods which has also moved to Polygon. 

Besides, because of technical differences, Solana still has to "grove" quite a lot in development, which is why we see many problems happening in the network, even some quite serious problems that make the network go down. The network must be shut down, which significantly affects the user experience and trust. 

Differences in ecosystem development

At the moment, most of the value is concentrated in Ethereum and EVM chains . With the feature of being open source, projects can be easily "copied" from previous projects, which saves a lot of development effort. But in the opposite direction we see these ecosystems have quite similar patterns and not many breakthroughs.

Solana is an ecosystem with many different approaches, such as: 

1. Being the first ecosystem outside of Ethereum to have a second client (Firedancer). This will help increase the stability, security, decentralization and interoperability of the network.

2. Develop Solana phones with specialized toolset, allowing developers to create decentralized applications on the phone. There are currently exclusive applications developed on Saga.

3. The environment is suitable for projects with novel concepts. Solana's fast speed, low cost is really becoming an advantage to incubate new projects.

Some projects with new concepts can be mentioned as: 

• StepN: Combining elements of running and tokenomics

• NFT backpack: Framework for creating, managing, and grouping NFTs.

• Monaco Protocol: Infrastructure for rapid development of betting platforms.

• Hivemapper: decentralized mapping project.

• Project Helium provides point of delivery network connectivity also moved back to Solana.

• Develop payment applications such as Solana Pay, Sphere.

• And there are many projects in many different fields that have been and are being developed.

In addition to having a suitable platform, Solana also continuously organizes events such as Hackathons, Hacker House which has shown initial results when the ecosystem is still receiving a lot of response from the community. 

For developers new to the ecosystem, they can easily find resources to support their learning. Tutorial aggregators, tools like Soldev, or even a Solana-related version of ChatGPT like Solana University are really bridging the gap in the developer community. 

Doing things differently has helped Solana stand out amid so many similar projects in the market. It is possible that the idea and quality of most projects on Solana are not yet complete, but similar to the StepN example, just one successful application will help accelerate the growth of the entire ecosystem.

Solana currently has problems with platform design and lack of products that really attract users. But with many new products being cherished and developed, promising to bring many surprises in the future.

Factors assessed in the article include:

• Potential finance 

• The current context of the gaming segment in that ecosystem

• Analyze potential game projects in the ecosystem. 

  Ronin

  Ronin Network is a blockchain researched and built by Sky Mavis - a company from Vietnam. Blockchain has the goal of supporting the development of NFT Gaming, with the most prominent game project currently being Axie Infinity. 

  Financial stability despite being hacked

  Sky Mavis has raised a total of 311 million USD with the most recent valuation of 4.5 billion USD.

Ronin network had a total of 173,600 ETH and 25.5 million USDC hacked, which amounted to 625 million USDC at that time. However, with a revenue of up to $ 1.2 billion in 2021 from the game Axie Infinity, we can surmise the financial situation of Ronin Network is still quite abundant. Ronin Network has also confirmed that the company currently has more than 200 employees at the end of 2022 and is currently recruiting more.  

Closed game ecosystem

Coin98 has a detailed article evaluating the Ronin ecosystem, readers can refer here.

Currently, the Ronin ecosystem has basic pieces for asset transfer such as Katana DEX, MetaLend, Ronin Wallet. As for gaming, Ronin is still quite closed when the game products on the system are developed or backed by Sky Mavis. 

Projects that are supported by Sky Mavis and are eligible for Mavis Hub now need to participate in Axie Infinity's Builders Program. This program aims to incubate games based on the image of Axies. If the project has a good product and is accepted, it will be supported and have the opportunity to go to Mavis Hub. Readers can refer to the list of games in the builders program here .

In the early stages, Sky Mavis chose to go slowly but surely when focusing on quality and limiting the number of games. However, almost all current game projects on the ecosystem revolve around the character Axie. Recently, Ronin announced a few new games with a different set of characters to increase the diversity of the ecosystem.

Axie Land

The turn-based strategy game Axie Infinity is currently still the main product of Sky Mavis, but looking at the game's revenue above, we can see that the current project has reached the saturation stage. 

The next game developed by Sky Mavis is Axie Land. Axie Land is the kingdom building game of the Axies, the game has been released in beta. In addition to NFT land representing the land in the map, this version has not yet integrated elements such as NFT, tokens. 

Players at this stage can also only harvest resources to build their own land. In the future, more community elements will be updated such as bringing troops to fight other lands as well as elements related to tokenomic and user experience. 

Ronin Network is a gaming ecosystem with good financial potential. Going slowly but surely has helped the ecosystem to have pieces that meet the user experience such as a stable blockchain, game hub, asset rotation dapp. However, the open factor needs to be considered to help the ecosystem develop more diverse games. 

Immutable X

Immutable X is a layer 2 scaling solution focused on NFT and gaming on Ethereum.

Streamlining the apparatus

Immutable X has successfully raised a total of more than 300 million USD through rounds. Immutable and its foundations have also established a $500 million fund to invest in game projects developed within the ecosystem. 

Despite having abundant financial resources, Immutable's performance was not as effective as expected. The project just laid off 11% of the staff due to a loss of up to $ 56 million in 2022. Accordingly, Immutable's revenue for the year was only $ 27 million while expenses were up to $ 83 million. Much of the money is used to pay employees and partner with big names. 

Open game ecosystem

Immutable X is an open ecosystem, so any project can participate in the development of the game above, combined with a $500 million incentive fund that has helped Immutable X attract a large number of games. 

Immutable X also recently launched its All-in-one passport system, which combines features such as wallets, personal portfolios and verification solutions to help game studios simplify access for users. used with on-chain games. 

In terms of game quality, most games are still in the developing stage and the quality is quite mixed. Looking at the transaction volume of the top NFTs on Immutable X, we can see that the projects on the ecosystem have not yet attracted users. 

Illuvium's flagship product

The two games that made a name for Immutable X are Gods Unchained and Illuvium. 

Gods Unchained is a card game developed from the early days of the Ethereum blockchain, the project later moved to ImmutableX. With such a reputation, the game has a relatively large and loyal community. The game is currently ranked 1st in terms of NFT trading volume on ImmutableX

However, as a card game that has pushed Gods Unchained to the limit of development, the project is unlikely to have many groundbreaking updates in the future. Illuvium now appears as the "pet" of ImmutableX.

In addition to the announced $5 million investment, Illuvium raised $72 million from the in-game NFT virtual land sale. With abundant capital and long development time, Illuvium is likely to be a strategic card to attract more users to the ecosystem. 

Immutable X currently still lacks the necessary pieces to help transfer assets or create a game hub for users' game search needs. The ecosystem attracts many development projects but needs to focus on improving quality in the future. 

ApeChain

ApeChain is the blockchain created by Yuga Labs, the team behind many famous NFT suites including Bored Ape Yacht Club (BAYC). ApeChain was created with the aim of developing a platform that can connect NFT communities in the Yuga Labs universe. In addition, it is also the future blockchain for this company's gaming ecosystem.

Virtual Universe for NFTs PFPs

After developing and owning many famous PFP collections , Yuga Labs is focusing resources to take the next step in expanding and connecting its huge community through the Otherside project developed on Apechain . 

The Otherside is a connected virtual universe (metaverse). Owners of NFT PFPs in the Yuga Labs universe can use their NFT as a character in the Otherside. 

Otherside is running a beta and the game can run smoothly with over 10,000 concurrent players. From the actual videos from users, we can see that the development progress of the game is very positive. 

However, it must be noted that building a universe large enough to meet the needs of tens, even hundreds of thousands of people takes a long time. A typical AAA game project takes an average of 2 to 3 years to develop, not to mention building a stable economy in the game. This will take time even for parties with great financial potential like Yuga Labs.

Other Notable Ecosystems

Besides gaming and NFT-specific ecosystems, there are also multi-purpose blockchains that are devoting a lot of resources to this area. Below are some notable names: 

BNB chain

At the end of 2021, the BNB chain and Animoca launched a $200 million fund to support the development of GameFi projects on the BNB chain. From that point on, the number of games and the number of active players in the ecosystem gradually increased. 

However, including the games funded by the fund, the quality of the games on the BNB chain is still quite poor. The number of players has increased, but this number is not much and no game has had a breakthrough in activity. 

The current BNB chain has pieces for asset circulation like AMM and NFT marketplace, but the number of quality games is still small and lacks a game hub to make it easier for users to find games. 

Solana

Solana has raised a total of $ 250 million in two rounds to develop the gaming segment on the ecosystem. These funds will be deployed through Solana Ventures. Looking at the investment activity of Solana Ventures , we can see many projects related to NFT and gaming being invested. 

The ecosystem already has the basic pieces to transfer assets, and there are game hub development projects like Elixir that help users both access traditional games and search for Web3 games. 

There are also many projects with new concepts being developed such as xNFT which helps to create and group NFTs into packages to facilitate transactions. 

In terms of game quality, there have been many games that have been developed for a long time such as Aurory, Star Atlas, DeFi Land,... New projects also have many potential names, some games are displayed at Hacker House Ho Chi Minh Recently like No Way Back, Chronos: Dawn of Time, ... attracted the attention of many people. 

Despite attracting many developers, the ecosystem still has no products that attract users. In addition to game quality, projects will need to have more measures to increase user attention, especially in the context that Solana does not receive as much attention as before.