Crypto-based play-to-earn games and game-related non-fungible tokens (NFTs) comprise the least affected sector in all of crypto during the current bear market, with venture capital investments continuing to flow into the sector, a new report from the decentralized app tracking site DappRadar has found.
According to the report, the gaming sector in crypto reached a peak as recently as June this year, when it finally experienced a slowdown as measured by the number of unique active wallets (UAW).
By comparison, the number of daily active wallets on the Ethereum (ETH) network as a whole reached a peak of well over 1m in May 2021, which it has yet to surpass.
The high usage implied by the number of active wallets was interpreted by investors as “a bullish signal to keep investing in blockchain games,” DappRadar wrote.
It further noted that the second quarter this year saw venture capital investments of USD 2.5bn flowing into the sector, which it said maintained the pace set in the first quarter, and “already surpassed the annual milestone of [USD] 4 billion set in 2021.”
Pointing to a new USD 4.5bn crypto-focused fund by VC giant Andreesen Horowitz as a major source of future investments into the space, the report argued that,
“At this pace, we are projected to have a volume of 12 billion invested by the end of the year.”
Among the areas in the gaming sector that stood out the most were virtual world-related NFTs, which saw their trading volume rise by 97% since the last quarter.
Meanwhile, the most popular game in the sector was Splinterlands, with a daily average of 283,729 unique active wallets during the quarter, according to DappRadar.
Another bright spot pointed to in the report was Alien Worlds, the second-highest-ranked game by unique active wallets. The game’s player base remained “more or less stable” over the quarter, with the number of active wallets falling just 4% in the second quarter compared to the previous one.
In terms of the things that have not gone so well for the sector, the report pointed to the play-to-earn game Axie Infinity (AXS). The game has lost 40% of its players since the first quarter, largely due to the major Ronin bridge hack and the depreciation of the game’s SLP token.
The Ronin bridge is a cross-chain bridge used to transfer assets from the Ethereum blockchain to Axie Infinity’s custom-built blockchain Ronin.
That said, commenting on the findings in the report, Pedro Herrera, Head of Research at DappRadar, said that blockchain games have become “one of the most promising sectors of Web3.”
He added that the amount of capital raised, along with an “exodus of talent shifting from the leading traditional gaming companies to web3 game startups,” are other positive signs for the sector going forward.
“We are gradually seeing how Immutable-X, Gala Games, and other networks are positioning themselves to lead the rising category in years to come with impressive partnerships already in place,” Herrera said.
Source: Cryptonews
