Author: flowie , ChainCatcher
Editor: Marco, ChainCatcher
Web3 games seem to be entering a strong recovery phase.
Recently, with the social game Notcoin (NOT), which has 900 million active Telegram users, being launched on Binance and OKX exchanges at the same time, Web3 games have once again attracted massive attention from the crypto market.
According to Jack Booth, marketing director of the TON Foundation, compared to the 2 million daily active users of the first-generation Web3 game king Axie Infinity at its peak, Notcoin achieved 6 million daily active users during the mining stage. In almost 3 months, the number of users increased to 35 million.
On May 16, Notcoin official data showed that NOT’s market value exceeded US$820 million just one hour after it was launched on various exchanges.
In addition to Notcoin's astonishing growth, the April blockchain game report released by DappRadar and the Blockchain Game Alliance shows that the entire blockchain game market has a clear growth trend, with an average of 2.9 million independent active wallets (dUAW) per day in April, an increase of 17% from March.
Data from Footprint Analytics shows that the average daily active users (wallets/players) of blockchain games exceeded 3 million in April.
In addition, the DappRadar report stated that investment in the blockchain gaming sector reached US$988 million in April, a new high since January 2021.
Two major venture capital firms raised nearly $900 million in total to save ammunition for Web3 games
The total investment in Web3 games in the first quarter of 2024 was around 288 million, while the total investment in April suddenly increased by more than 2 times, mainly due to the completion of a new round of fundraising by two major venture capital firms, a16z and Bitkraft Ventures.
On April 17, a16z announced that it had successfully raised a huge new fund of US$7.2 billion, of which US$600 million would be allocated to the gaming industry, including companies developing new games, gaming platforms, gaming-related technologies or other gaming industry innovations.
Regarding the use of the $600 million game industry investment funds, Andrew Chen, general partner of a16z and head of a16z Games Fund One, revealed that it will be used to create a second game fund, covering more diverse fields: from AI, Web3 games, VR/AR, 3D tools, game apps to studios, etc.
Earlier, Andrew Chen had announced that he would invest a total of US$30 million in multiple game companies, including Web3 games, through the a16z Speedrun program before May 19, and each startup joining the Speedrun program would receive US$750,000.
RootData data shows that Web3 games are the second largest investment area in a16z's crypto investment after infrastructure, and it has invested in at least 25 Web3 games.
Since the beginning of this year, a16z has participated in two Web3 game investments, one is the $13 million Series A financing of the doomsday NFT shooting game MadWorld, and the other is the $8 million financing of MyPrize, a developer of the GambleFi ecosystem.
In addition to a16z, another venture capital firm Bitkraft Ventures also announced the launch of its third gaming fund in April. The fund has raised $275 million and will focus on game studios, technologies and platforms at the seed and Series A stages.
Bitkraft Ventures also recently announced the introduction of two new executives to expand the Asian Web3 game market, namely Jin Oh, former president of Riot Games and CEO of Garena, and Jonathan Huang, former vice director of Temasek.
Bitkraft Ventures has been very active in investing in Web3 games. In 2021, Bitkraft Ventures raised $75 million and launched its first token fund to invest in blockchain games and digital entertainment. At the end of March 2023, Bitkraft Ventures raised another $220 million for its second "token fund."
To date, Bitkraft Ventures has publicly announced nearly 50 investments, most of which are in the Web3 gaming sector, with representative cases including YGG and Immutable.
From the beginning of this year to date, Bitkraft Ventures has participated in the investment of four game projects: Metalcore, MadWorld, Avalon, and My PetHooligan. Among them, MadWorld was invested in together with a16z.
Daily active users hit a new high. Which Web3 games are leading the pack?
Amid the overall downturn in the crypto market, the number of active users of Web3 games is on the rise.
Robin Guo, a16z gaming investor, quoted Footprint Analytics on the social platform and exclaimed: "The MAU (monthly active users) of Web3 games is 3.3 million, which is far higher than the peak previously created by Axie. If the data is not cleaned, I am sure that many of them are robots, but the recent growth led by Pixels is still impressive. It feels like this is really overlooked."
According to a report by DappRadar, the number of dUAW (daily unique active wallets) for Web3 games reached 2.9 million in April, a record high.
Among them, the top ten Web3 game applications ranked by UAW (unique wallet address) all have UAW exceeding 1.5 million. Pixels still occupies a strong dominant position, with UAW exceeding 20 million, followed by Sweat Economy and StarryNift, with UAW exceeding 5 million.
Most of these 10 games were launched around 2020 and 2021.
Pixels is a pixel-based farming game launched in 2021. It migrated from Polygon to the Ronin network at the end of last year. Ronin is the Ethereum Virtual Machine (EVM) chain developed by Sky Mavis, the developer of Axie Infinity. The growth of Pixels also makes Ronin the most active game chain at present.
In February this year, Pixels was listed on Binance. As of May 21, its fully diluted market value was about $1.9 billion. Recommended reading: "Pixels' Second Anniversary: The Metaverse Pixel Farm Chain Game Carrying the Ronin Ecosystem"
Sweat Economy is a fitness-themed move-to-earn game. It is a small game modified from a traditional fitness application chain with 100 million users. Sweatcoin is built on the Near chain.
StarryNift is an AI-enhanced co-creation metaverse platform that provides an immersive 3D virtual experience for gaming, creation, and socializing. The founder of StarryNift was a founding partner of Matrix and a co-founder of DEx.top. StarryNift has completed three rounds of financing, with investors including OKX Ventures, SIG Asia Ventures, Binance Labs, GBV Capital, BNB Chain Fund, Alameda Research, LD Capital, Coingecko Ventures, etc.
Founded in 2021, Another World is a Korean Web3 metaverse project built on the Klaytn chain. Formerly known as Terra World, it has just completed public beta. According to public reports, Another World is supported by South Korea's Kakao Group and LG Group, and has a huge global user community of 200,000 and a powerful blockchain token system.
Alien Worlds is a relatively old space exploration game that integrates DeFi, NFT and DAO. In 2021, it received $2 million in financing from Animoca Brands, LD Capital and others. As of May 22, the fully diluted market value of its token TLM exceeded $100 million.
MotoDex is a motorcycle racing game built on the Ethereum sidechain SKALE. According to DappRadar data, its UAW in the past 30 days has exceeded that of Pixels.
Nine Chronicles is a long-established decentralized RPG (role-playing game) that has received two rounds of financing, with Binance Labs and Animoca both participating in the investment. As of May 22, the fully diluted circulating market value of Nine Chronicles' token WNCG was around US$70 million.
Apeiron is a card duel and god simulation game. In December last year, Apeiron announced its migration to the Ronin network. It completed a $10 million seed round of financing led by Hashed in 2022. On February 28, the public beta of Apeiron Arena was released on the Epic Game store. Players can earn ANIMA airdrop points by downloading and participating in the competition. Its token APRS is launched on Bybit, the decentralized exchange Katana of the Ronin blockchain. As of May 22, the fully diluted market value is US$580 million. Recommended reading: "Explore Apeiron: A blockchain game that subverts tradition, integrating mythology and modern gameplay."
Ultiverse is an AI gaming platform with a strong lineup of investors behind it. It has completed three rounds of financing, with a total of $1350 million. Binance Labs participated in two of the rounds, and IDG Capital, Animoca Brands, DWF Labs and many other well-known investment institutions also participated in the investment. On May 3, the 24-hour transaction volume of Ultiverse Gold Chip NFT exceeded 1100ETH, ranking first on the BLUR transaction list.
World of Defish is a decentralized NFT game world running on the BNB chain, incubated by the decentralized IDO platform Poolz and invested by Poolz ventures.
In addition to these 10 Web3 games with higher UAW, the monthly active users of the shooting mobile game Matr1x in the past 30 days are also outstanding. Matr1x received strategic financing from Animoca in February. In the previous three rounds of financing, well-known institutions such as OKX Ventures, SevenXVentures, Folius Ventures, ABCDE, and Hashkey Capital have participated.
Conclusion
Although there are popular games such as Pixels and Notcoin in this bull market, there seems to be some gap compared to the phenomenal games such as Axie and STEPN that led the new paradigm of Web3 games at the time.
After the P2E period, venture capital's investment hotspots in Web3 games are, first, 3A masterpieces that attempt to create Web2 game experience, and second, full-chain games that are committed to putting all content such as game logic and game assets on the chain.
At present, 3A blockchain games are also facing doubts about whether they are just capital speculation because they are expensive to produce and have a long implementation cycle. On the contrary, short, fast and lightweight games such as Notcoin have attracted a lot of traffic. Will the next phenomenal Web3 game be born in social games?
