Journalist
Posted:
- Blockchain gaming revenues were a fraction of those of the traditional video gaming industry.
- With 1.16 million unique active users as of this writing, the sector captured 33% of the dApp market.
On-chain gaming has become one of the fastest-growing industry verticals in the blockchain sector, garnering significant interest from enthusiasts over the years.
The prospect of decentralized ownership of in-game assets and getting the ability to trade them outside the gaming world added a new dimension to one of the most exciting tech industries at the moment.
On-chain gaming set to expand
As per a recently-published report by Binance Research, the blockchain gaming market witnessed revenues of $7.8 billion in 2023.
The industry was predicted to increase at a compound annual growth rate (CAGR) of 70.3% to more than $22 billion by 2025.
Source: Binance Research
While these numbers were indeed impressive, one mustn’t lose sight of the fact that the industry was still very much in its nascent stage.
As seen in the graph above, the revenues from blockchain gaming were a fraction of those of the traditional video gaming industry.
To understand the difference, for every 1000 players on Minecraft, the best selling-video game of all time, there was just 1 player active on Alien Worlds, one of the most popular blockchain games.
However, on-chain game developers were betting on relative benefits over traditional counterparts to drive adoption.
Advantages over Web2 gaming
As highlighted in the report, the decentralized nature would ensure that in-game assets continue to exist even if the game publisher goes bankrupt. This was in contrast to Web2 games, where the failure of the centralized entity meant the end of the game as a whole.
Moreover, the interoperability feature would allow users to transfer the assets they earned in one game and use it in the other, or even outside the gaming world. A traditional game setup restricts users in a controlled environment.
Current state of the market
Blockchain gaming continued to dominate the decentralized app (dApp) landscape, as per AMBCrypto’s examination of DappRadar data. With 1.16 million unique active users as of this writing, the sector captured 33% of the dApp market.
Source: DappRadar
Furthermore, at about 10.33 million transactions, it was the busiest dApp vertical, edging past even the decentralized finance category.
Failure rate on the higher side
While these were encouraging signs, the ground reality was a bitter pill to swallow. AMBCrypto reported recently how three out of every four on-chain game in the last five years failed. Even in 2023, the failure rate was 70%.