Thread by @PlayToEarnGames

Web3 Gaming Industry Overview 2022

🧵In this thread, we've compiled everything you need to know about #Web3Gaming's past, present, and future, so you don't have to!

- Looking at 2021 & 2022
- The limitations of the current Web3 gaming industry
- The future of Web3 gaming
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The year 2021 is fantastic for the GameFi sector. The crypto market is in a bull run phase with the persistence of the global pandemic.
Some Southeast Asian nations have very high unemployment rates, making the idea of "play to earn" a lifeline for many people.
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In such circumstances, #AxieInfinity was born and quickly became a global phenomenon.
A number of play-to-earn games also started to appear from this point on, just like mushrooms after rain.
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GameFi investors also increased rapidly in number, according to a Chainplay statistic, ¾ investors worldwide joined cryptocurrency because of Web3 games.
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Why is GameFi so popular in 2021?

▪️ The play-to-earn model emphasizes the earning factor, with players able to profit from both in-game assets and specific types of cryptocurrencies.
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▪️ During this time, the vast majority of Web3 game players were crypto-native users while as anticipated, their biggest motivation when joining is for profit.
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A Chainplay study found that 68% of investors have short- and medium-term (< 6 months) investments in Web3 games.
71% of investors put into GameFi more than 25% of their whole net worth.
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These facts back up the argument that the majority of people who participate in GameFi are for profit, they do not want to stick with a game for a long time; Instead, they just roam from game to game looking for short-term speculative opportunities.
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Bitcoin's price collapsed in late 2021 and early 2022, causing the market into a downtrend, the web3 gaming sector was no exception.

The price of Axie Infinity's $AXS token falls, and many other Play-to-earn projects suffer a similar fate.
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Why do Play-to-earn games crash so much in late 2021 and early 2022?

▪️ The majority of projects raise funds and use them to launch massive marketing campaigns instead of focusing on gameplay development.
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▪️ Many projects do not have enough traction and don't provide multiple utilities for the token, players quickly lose interest
▪️ There are too many crypto-native users who will leave the game once the profits are gone.
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*pause*

We're a third of the way through this thread, so let's discuss Web3 gaming's limitations.

✅Looking at 2021 & 2022
▶️The limitations of the current Web3 gaming industry
▶️The future of Web3 gaming
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💹In-game Economy Design
According to Chainplay statistics, 58% of investors worldwide stated that "Poor In-game Economy Design" is the main reason for declining GameFi profits. This is also a major reason why investors are hesitant to make long-term investments in projects
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For a game to be successful, its economy must be viable.
This is especially important in blockchain games, as real money is involved. This means that the economy must be stable, self-sustaining, and provide a profitable investment opportunity for gamers/investors.
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Tokenomics must be mentioned while discussing the in-game economy. The foundation for a long-term sustainable in-game economy will be a solid tokenomics design.
However, it seems that Web3 games currently have not really done well in this aspect.
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🕵️‍♀️Rug Pulls & Ponzi schemes
According to Chainplay findings, 73% of investors shy away from Web3 games investments because they are afraid of rug pulls, Ponzi schemes, and pyramid schemes projects.
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This finding indicates numerous insights about the present state of Web3 games. The effort to make these games as decentralized as possible has led to a lack of oversight, which allows fraudsters to profit from the scams they design in the name of GameFi projects.
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🤑Irrational expectations
The major issue in the blockchain gaming space is that players enter all of the games believing that they should always come out net positive on whatever they spend in the games.
You can't always expect to spend 10$ in the game to earn 11$.
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*pause*

Let's come to the final part, the future of the Web3 gaming industry

✅Looking at 2021 & 2022
✅The limitations of the current Web3 gaming industry
▶️The future of Web3 gaming
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According to Chainplay data, 81% of GameFi investors prioritize the fun factor when it comes to future GameFi projects.
This is understandable given the failing profit-priority model.
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Web3 games will still need an Earn factor, but future games should focus more on improving game quality. The whole point behind video gaming, be it Web3 games or traditional games, is to create positive experiences first. Earning ought to be a secondary, not a primary goal
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In a Chainplay survey, what factors do investors want to see in future Web3 games?
The results are not too surprising. 71% of investors say that “Interesting Gameplay” will keep them hooked to the industry.
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Another important question is what factors will be key drivers for Web3 games' growth in the future. 44% of investors believe that the entry of traditional gaming companies into the Web3 space is the key driver for Web3 game growth. We seem to have envisioned the future.
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It's done, we successfully covered:

✅Looking at 2021 & 2022
✅The limitations of the current Web3 gaming industry
✅The future of Web3 gaming
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