Author: stella@footprint.network
Data source: Blockchain Game Research Page - Footprint Analytics
The blockchain gaming space saw significant growth in February 2024, driven by rising cryptocurrency prices and a surge in active users. However, the industry still faces challenges in maintaining user engagement and retention rates, and both transaction value and number of transactions have fallen short of expectations.
Blockchain platforms are actively establishing partnerships with content creators such as Web2 Game Studios to seek growth opportunities. Public chains focus on the collaborative development between games and platforms, and game developers are committed to expanding game IPs to broaden player participation and enrich the entire ecosystem.
The data for this report comes from Footprint Analytics' Web3 Games research page. This is an easy-to-use dashboard that contains the most important statistics and metrics for understanding the Web3 Games industry, updated in real time. You can click here to get the latest information on prices, projects, funding, and more.
Market review this month
In February 2024, both Bitcoin and Ethereum showed significant growth. Among them, Bitcoin rose strongly, rising by as much as 46.5%, closing at $62,404 at the end of the month, breaking the $60,000 mark for the first time since the fourth quarter of 2021, and only 9% away from its all-time high. Ethereum performed even more impressively, slightly outperforming Bitcoin with a gain of 48.1%, closing at $3,383 at the end of the month.
Data source: Bitcoin and Ethereum prices - Footprint Analytics
The significant rise in the cryptocurrency market in February was driven by a combination of factors. Among them, the U.S. spot Bitcoin ETF attracted a whopping $6 billion in inflows in February, a figure that underscores investors’ strong confidence in cryptocurrencies as an effective store of value. In addition, market expectations for the Ethereum Cancun upgrade in March and the Bitcoin halving event in April have further pushed prices higher. Together, these factors have provided strong support for the rise in the cryptocurrency market.
However, broader market dynamics, such as inflation concerns and Federal Reserve policy, could pose challenges to continued growth. The rise in inflation in February means that expected interest rate cuts in the United States may be delayed until later this year or even later, which undoubtedly brings uncertainty to the continued growth of the cryptocurrency market.
Overview of the blockchain game market
The market capitalization of blockchain gaming tokens surged 54.0% in February to $18.5 billion amid strong growth in cryptocurrencies.
In February, the number of daily active users (wallets) continued to climb, reaching 2.3 million, up 28.9% from January. The unremitting efforts of blockchain game industry builders have successfully attracted more Web2 game studios and players to enter the Web3 game field, driving the rapid development of the industry.
Data source: Daily active users of blockchain games - Footprint Analytics
However, compared with attracting new users, the situation of user engagement and retention is not so optimistic. Most Web3 game developers still face major challenges in these two aspects. According to Footprint Analytics, the increase in transaction amount and number in February was lower than expected.
Data source: Blockchain game monthly transaction amount and number - Footprint Analytics
In the context of the broader Web3 gaming market, its impact on other blockchain fields has gradually become apparent, especially in-game NFTs.
Gas Hero, the second game developed by StepN team Find Satoshi Lab, is a case in point. The game announced on February 28 that it would return to closed beta due to major difficulties. Although the trading volume of the Gas Hero NFT series soared after its successful launch in January, its trading volume dropped sharply by 87.2% in February. This obvious downward trend had a direct impact on Polygon and Mooar (NFT trading market), where NFT trading volume on these two platforms dropped by 80.8% and 87.2% respectively.
Blockchain game public chain data
The game rankings in February show that Ronin, BNB Chain and Polygon performed well in terms of user activity, accounting for 29.1%, 13.4% and 13.1% of the market share respectively. In terms of transaction volume, Ethereum, BNB Chain and Ronin ranked at the top, showing strong market performance.
Data source: Percentage of active game players on each public chain - Footprint Analytics
Public chains are seizing growth opportunities through in-depth collaboration with content creators. Faced with local regulatory challenges, Korean Web3 game developers are actively looking to the global market to find a broader space for their blockchain games. As a leader in this trend, Oasys not only provides Layer 1 networks, but also launches Layer 2 networks based on Ethereum to provide diversified technical support for game developers. Recently, Oasys announced a strategic partnership with Com2uS, a well-known Korean game developer, and then joined hands with Metabora SG, the Web3 game division of Korean Internet giant Kakao.
In addition, expanding the ecosystem through mutual growth between games and blockchain platforms is another measure for public chains to gain growth. Web3 game Pixels will migrate from Polygon to Ronin at the end of October 2023, taking advantage of Ronin's superior interoperability and marketing support. This shift has significantly increased the game’s popularity and on-chain activity. In February alone, Pixels achieved more than 1.5 million on-chain interactions and approached the 1 million user milestone. This growth trend has undoubtedly had a positive impact on Ronin as well, highlighting the mutual benefits brought about by the cooperation between the two parties.
In addition, Pixels launched the PIXEL token in February and combined the "Play and Earn" airdrop event and the Binance Launchpool reward program to further enrich the gaming experience. In order to give back to Ronin supporters, Pixels also announced an airdrop of 20 million PIXEL to users who staked Ronin RON tokens to reward Ronin supporters.
Overview of Blockchain Games
Activity in the blockchain gaming market remained relatively stable in February, with 2,880 games remaining active. However, it is worth noting that the percentage of games with more than 1,000 users fell slightly from 8.3% to 7.9%. Despite a 28.9% increase in overall active users, this growth did not lead to more games becoming active, even when the market showed signs of a bull run. This shows that only a few blockchain games have successfully attracted a growing player base, while the majority of games are still facing the challenge of weak user growth.
Data source: Number of monthly active blockchain games - Footprint Analytics
Some games are actively expanding their game intellectual property (IP) to enrich their content and attract more players. Bali Games, a well-known Korean mobile game developer, successfully launched the RPG game Axie Champions based on the Ronin blockchain. By cooperating with Sky Mavis, the developer of Axie Infinity, the game cleverly incorporates elements of the popular Axie Infinity IP to bring players a brand new gaming experience. Players also have the opportunity to receive AXS tokens as rewards while participating in the game, which undoubtedly increases the attractiveness and playability of the game.
At the same time, the continuous launch of new games continues to inject vitality into the market. Among them, the first-person shooter game MATR1X FIRE has quickly attracted more than 400,000 daily active users since its launch in February, becoming a new favorite in the market. In addition, as a comprehensive platform, MATR1X cleverly combines artificial intelligence (AI), Web3 technology and e-sports, and is committed to creating unique and innovative game products.
Blockchain game investment and financing
In February, the Web3 gaming sector continued to maintain strong momentum, successfully attracting 19 rounds of financing, totaling $83.6 million. This series of financing activities not only highlights the huge appeal and broad prospects of the Web3 gaming industry, but also reflects investors' continued optimism and firm confidence in the field.
Investment and financing events in the blockchain gaming sector in February 2024
However, among the above 19 rounds of financing, as much as 89.5% of the financing amount was less than US$10 million, reflecting that investors are more cautious in their investment strategies in the blockchain gaming field.
Several game studios and games, such as Brawl Studios (BitBrawl), Matr1x FIRE, and Pixels, have successfully received new financing. At the same time, as a high-profile field, gaming platforms have also emerged with a number of outstanding companies, such as Crystal Fun, Ultiverse and OVERWORLD, etc., all of which have made significant progress in their respective fields. It is particularly worth mentioning that OVERWORLD, incubated by the Xterio ecosystem, successfully received US$10 million in seed round financing and is committed to pioneering cross-platform RPG games.
The spotlight was also on the gaming infrastructure sector, with infrastructure provider Ready Games Network (READYgg) and blockchain gaming data analytics platform Helika both successfully completing their latest rounds of funding.
Gambling platform Monkey Tilt successfully obtained the largest financing in February, with a total of US$21 million, with participation from well-known institutions such as Polychain. This major financing event is in line with our 2023 blockchain game annual report forecast, further confirming that the GambleFi sector still has huge growth potential while facing regulatory challenges.
This month's highlights
Crypto gaming company Gala Games has launched the GalaSwap exchange and is offering token rewards.
LBank, a leading global digital asset trading platform, announced the integration of Oasys into its diverse trading portfolio.
Bitcoin Cats launches 1CAT Chain testnet to enter the blockchain gaming field.
Crypto gaming platform PlayDapp lost $290 million worth of tokens in two attacks.
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The content of this article is only for industry research and communication purposes and does not constitute any investment advice. The market is risky and investment should be cautious.
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