For all of the talk about web3 gaming - from promises of NFT-enabled ownership and a new era of interoperability, to the short-lived hype cycles around GameFi and play-to-earn - it doesn’t quite feel like we’ve seen all that it has to offer.
It’s not that we haven’t seen fun games here and there (Gods Unchained comes to mind), and a lucky few have certainly made money on play-to-earn games. But let’s be honest: so far, nothing has really lived up to the hype.
That time could be arriving sooner than we expect.
Contents
- The Promise of Web3 Gaming
- Web3 Gaming Today
- Upcoming Games
- 1. Gala
- 2. Illuvium
- 3. Vulcan Forged
- 4. Yield Guild Games
- 5. Midnight Society
- Conclusion
With significant investments behind them, several indie and AAA game developers are growing into behemoths in the field, and are now preparing to deliver games that could demonstrate the true potential of web3 and kick off the next hype cycle around crypto.
If there’s any sector that can pull it off, I think it’s going to be web3 gaming. I’ll explain why in a minute, but first, I want to talk about what web3 brings to gaming in the first place.
The Promise of Web3 Gaming
What separates web3 games from traditional games is the tandem promise of ownership and interoperability. By using blockchains as a public register of gaming assets, web3 aims to give players the ability to own different components of a game and use those components even when they’re playing another game.
Gamers are already big on ownership - Fortnite, a free battle royale shooting game, generated over $5 billion for parent company Epic Games in its first year by selling digital accessories. Players who want to play as Marvel characters or have shiny, colorful skins for their weapons are more than willing to shell out the money to do so, but few realize that Epic ultimately retains ownership of these accessories. If Fortnite ever goes away, so do the accessories - and all of the money that’s been spent on them will evaporate into thin air. By introducing distributed ledgers to the equation, Web3 solves this by creating a system for gamers to keep track of their digital property.
Taking this concept of digital ownership one step further, Web3 fundamentally expands the gaming experience by making it composable, interoperable, and open-source. Just imagine: what if we designed games in a way where things like items, characters, and even maps can be ported from one game to another, so players can enjoy continuity between their games? Will different games leverage the same maps, items, etc.? Will the same asset appear as different items in different games? What about characters that can earn stats and level up across games? The possibilities are endless.
When we talk about fulfilling the promise of web3 gaming, we’re not just talking about the moment one or even a small handful of web3 games find mainstream success; we’re talking about the point at which gamers can enjoy an open ecosystem of games that leverage the benefits that web3 games have been promising all along. This is when we might get a watershed moment where Web3 gaming explodes in popularity.
Web3 Gaming Today
These stats from Cointelegraph’s March 2023 Report on blockchain games might best underscore the growth and potential of Web3 gaming:
On top of the funding and sheer number of games coming down the pipeline, web3 games took up 49% of all on-chain transactions in 2022 and saw a 60% increase in daily average users from 2021 to 2022, demonstrating growth in the userbase for web3 gaming and significant potential relative to other applications of blockchain technology.
At the moment, there are a lot of resources going toward making this dream a reality. To get a sense of where the industry is at, let’s look at some of the headlines that have defined the development of blockchain/NFT/web3 gaming over the past five years:
December 4, 2017 - Bloomberg - CryptoKitties Mania Overwhelms Ethereum Network's Processing
August 22, 2018 - CoinDesk - A Crypto Card Game Is Testing Magic's Records – And It Hasn't Even Launched
March 12, 2019 - Ledger Insights - Ripple targets game developers with $100 million fund
June 4, 2020 - Cointelegraph - Blockchain Gamers Earned $20M in Their First Year
March 9, 2021 - Bloomberg - Gaming Crypto-Artists Court Controversy While Cashing in on NFTs
October 15, 2021 - The Verge - Valve bans blockchain games and NFTs on Steam, Epic will try to make it work
November 3, 2021 - PC Gamer - EA calls NFT and blockchain games 'the future of our industry'
July 25, 2022 - Time Magazine - A Crypto Game Promised to Lift Filipinos Out of Poverty. Here's What Happened Instead
January 30, 2023 - BeInCrypto - Blockchain Gaming Industry Looks Beyond Play-To-Earn
In spite the bear market, the pace of investment or development activity doesn’t appear to have slowed at all. In fact, Epic Games’ GM Steve Allison recently reported that Epic currently has five crypto games in its marketplace and nearly twenty more in the pipeline.
Looking at the investment landscape, a 2022 Blockchain Games Report from DappRadar shows significant growth in investments in blockchain games. From 2019 to 2022, investment in blockchain games has grown from $27 million to $7.6 billion dollars.
VCs may be far from infallible, but they certainly don’t invest in sectors where they don’t see the potential for astronomical growth. Not only does confidence appear to be growing in web3 gaming, a survey of nearly 1000 deals in web3 showed that VCs have invested more in web3 gaming than any other sector.
Either VCs feel they’ve lost the potential to squeeze value out of the other sectors of web3, or more likely, they simply feel that web3 gaming holds more potential for imminent financial success than the other sectors.
In other words, investors clearly see something happening - and they’re not the only ones. Several web3 gaming infrastructure providers have created grant programs to support game studios and developers working on web3 games as well, including ImmutableX ($500,000,000), Avalanche ($290,000,000), and Game7 ($100,000,000).
With so many resources at their disposal, the only question now is whether or not gaming studios can turn all of these resources into novel gaming experiences that people actually want to enjoy.
Upcoming Games
While many of the games that have been released so far have simply ridden the hype train by incorporating NFTs into boring, cookie-cutter RPGs, a small handful of projects appear to be working on web3 games that might be genuinely fun to play, and potentially toward a full ecosystem of web3-enabled gaming.
I’ll point out some projects that demonstrate what’s coming in web3 gaming below, but check out DappRadar for a comprehensive list of web3 games.
1. Gala
Gala’s upcoming offerings include everything from shooters and RPGs to simulators and strategy games:
- Battlestar Galactica Eternity (4x MMO)
- Grit (Battle Royale)
- Last Expedition (Survival FPS)
- Legacy (Business Sim)
- Legends Reborn (Card/Strategy)
- The Walking Dead: Empires (Survival MMORPG)
The full list can be found here. You probably noticed that two have acquired licenses to be associated with major franchises: a Battlestar Galactica 4x MMO and a survival MMORPG based on The Walking Dead.
Gala’s games incorporate web3 technologies but it’s not clear how any of the games will promote interoperability at this point. At this stage, their focus seems to be on making playable games and incorporating interoperability when and where it makes sense.
2. Illuvium
Illuvium is taking a different approach: rather than supporting different games that take place in different settings, Illuvium is building what it describes as an “Interoperable Blockchain Game (IBG) universe” consisting of multiple games set in a single universe.
Illuvium Zero is a world-building simulator with an alpha release currently available. The other two are only available to private beta testers at this time: Overworld, an open-world RPG, and Beyond, a collectible auto-battler.
The project is being built on Immutable X, an infrastructure provider specifically designed for web3 games. In addition to hosting two blockchains optimized for web3 gaming - a zkEVM and ZK-rollup, Immutable provides solutions for things like wallet onboarding and NFT gaming to make it easier to build web3 games. Immuable X also hosts Gods Unchained, one of the most popular web3 trading card games to date.
3. Vulcan Forged
Vulcan Forged is like Illuvium on steroids. The company’s website describes it as “an established non-fungible token (NFT) game studio, marketplace, and dApp incubator with 10+ games, a 20000+ community, and top 5 NFT marketplace volume.”
With five games, two tokens, and a variety of different gaming mechanics integrated into the ecosystem, Vulcan Forged at least appears to have a lot going on.
Some of their titles include:
Tartarus (Action Survival) Block Babies (Card/Strategy) Forge Arena (Auto Battler) Vulcan Assassans (Survival Shooter) Vulcan’s Tower Defense (Tower Defense)
The full list is available on their website. As I mentioned, Vulcan Forged uses two tokens: PYR and LAVA. Both tokens can be earned by playing games and offer numerous utilities outlined in Vulcan’s documentation: PYR and LAVA.
4. Yield Guild Games
If there’s a web3 game and you’ve heard of it, chances are good that Yield Guild Games (YGG) has some kind of hand in it. Best known for titles like Axie Infinity, Splinterlands, and The Sandbox, Yield Guild is focused on building and investing in play-to-earn games.
Yield Guild held a token sale in July 2021 for YGG token, which Yield Guild’s white paper says can be staked for token rewards, exclusive content, exclusive merchandise, and to vote and participate in the DAO.
So far, however, there isn’t an active DAO and the article introducing their DAO names YGG’s founders as the exclusive owners of YGG’s assets. Much of Yield Guild’s marketing materials feature its cofounders: gaming industry veteran Gabby Dizon, fintech entrepreneur Beryl Li, and developer Owl of Moistness. YGG also has eight regional subDAOs, six of which met at a subDAO summit held in Manila in November 2022.
When I reached out, however, I learned that YGG does have a DAO set up on Snapshot and was told that launching the DAO simply wasn’t an early priority on their roadmap. YGG does provide frequent updates on their investments and work building out their ecosystem in their blog so we’ll have to keep an eye out to see when and how they plan to facilitate decentralized governance.
5. Midnight Society
Formerly known as “Project Moon,” DeadDrop bills itself as a Vertical Extraction Shooter - a combination between a free-for-all Battle Royale and an extraction shooter that encourages stealth rather than speed and accuracy.
DeadDrop is being developed by Midnight Society, a team with experience building games like Call of Duty, Halo: Infinite, and Gears of War. The studio was founded by Dr. Disrespect, a video game streamer who had over four million followers on Twitch before getting banned from the platform in 2020.
Midnight Society raised 199 ETH by selling 10,000 Founders Pass NFTs granting holders exclusive access to gaming assets, merchandise, live events, and opportunities to participate in beta testing.
DeadDrop is one of a number of web3 shooting games coming down the pipeline - Citizen Conflict, The Harvest, and Shrapnel, to name a few.
Conclusion
With so many shots on goal coming for web3 gaming and both on and off-chain metrics flashing green, it feels like it can only be a matter of time before something hits it big. If ICOs kicked off the first bull run at the end of 2017 and NFTs fueled the second in 2021, largely due to speculation around the possible applications of these new technologies, imagine what could happen when web3 gaming takes off.
Special thanks to Rxndy444 for providing feedback on this article.
