September Web3 Game Report: Growth in Numbers, Entry of Giants, Challenges in User Acquisition and Retention Remain
With the expansion of the Web3 gaming market and the entry of major players, the challenges in user acquisition and retention remain severe.Author: stella@footprint.network
In September, Bitcoin's price fluctuated narrowly, with a slight increase of 3.7%. The Web3 gaming industry is growing, but there are still fewer than 10 games with over 1,000 monthly active users. The distribution of games across different public chains remains relatively stable, with BNB leading with a 30.9% share.
As the Web3 gaming market expands and giants enter the space, challenges in user acquisition and retention remain severe. The industry needs to address these issues to ensure sustainable growth and mass adoption.
Moreover, the release of games on different public chains has heightened the demand for interoperability, as well as the emergence of new public chains with the potential to disrupt the dominance of currently leading chains. The future of Web3 gaming presents both opportunities and challenges, and we will watch closely how the industry evolves to meet the needs of players and investors.
The data in 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 gaming industry, updated in real-time. You can click here for the latest information on prices, projects, funding, and more.
Key Overview
Cryptocurrency Market Overview
- In September, Bitcoin's price fluctuated slightly, ranging between a low of $25,158 and a high of $27,210.
Web3 Gaming Market Overview
- The Web3 gaming industry continues to grow, with a total of 2,607 games, an increase of 2.6% from August and a significant increase of 15.0% from April.
- Major companies in the gaming industry are increasingly venturing into the Web3 gaming space.
- User acquisition, retention, and survival during market downturns are critical issues.
Web3 Gaming Public Chain Data
- On Polygon, there are 39 games attracting over 1,000 active users, accounting for 8.6% of its total on-chain games, while BNB has a ratio of 5.3% and Ethereum 1.5%.
- On September 28, Sui announced the launch of the Web3 gaming portal Play Beyond, which has launched 18 different types of games.
Web3 Gaming Project Overview
- In September, 13 gaming projects saw their token prices significantly surge, with increases exceeding 20%.
Web3 Gaming Investment and Financing Situation
- The investment and financing heat in the Web3 gaming sector remains stable, with eight rounds of financing this month attracting substantial investment amounts.
- Notable investment firms like a16z have shown signs of participating in "bottom-fishing" strategies.
Market Dynamics This Month
- zkSync Era is about to launch the latest work of the well-known chain game project Honor World------"Dream Island".
- Sui launched the Web3 gaming portal Play Beyond.
- Binance NFT will stop The Sandbox NFT staking program on September 26 and will no longer support the Polygon network.
- Crypto gaming company Proof of Play completed a $33 million seed round financing, co-led by a16z and Greenoaks.
- Web3 gaming studio GamePhilos completed an $8 million seed round financing, led by Animoca Ventures, Xterio, and others.
Cryptocurrency Market Overview
In September, Bitcoin's price fluctuated slightly, ranging between a low of $25,158 and a high of $27,210. The initial price at the beginning of the month was $25,940, with a slight increase of 3.7% during the month, closing at $26,899.
Data Source: Market Cap: GameFi Tokens vs BTC
Compared to last month, Bitcoin's value and on-chain activity increased in September. The increase in on-chain activity may be due to investors entering the market in preparation for the potential approval of a spot Bitcoin ETF by regulators. The spot Bitcoin ETF made some progress in late August.
Additionally, the trustee of the cryptocurrency exchange Mt Gox will postpone repayments to creditors until October 2024. They currently hold approximately 138,000 Bitcoins, valued at $3.7 billion, and this decision may reduce market sell pressure expectations, positively impacting Bitcoin's performance in September.
Web3 Gaming Market Overview
The Web3 gaming industry continues to grow, with a total of 2,607 games, an increase of 2.6% from August and 15.0% from April. Despite the upward trend in the total number of games, there are still relatively few games with over 1,000 monthly active users, accounting for less than 10%. In September, this ratio was 8.7%. These statistics highlight the ongoing challenges Web3 gaming faces in user acquisition.
Data Source: Monthly Active Games
Throughout the month, the daily active user count for Web3 games remained around 1 million, an increase of about 15% compared to August.
Data Source: Active Users & Growth Rate DoD
Major companies in the gaming industry are increasingly venturing into the Web3 gaming space. South Korea, known for its enthusiasm for esports and blockchain games, has a massive fan base, and consumers have a strong interest in diverse gaming cultures. South Korean listed game publisher Neowiz recently revealed plans to develop games on Avalanche through its Web3 subsidiary Intella X. South Korean entertainment group NHN Corporation announced a partnership with Sui, planning to launch an on-chain game in 2024.
These industry giants are expected to accelerate the mass adoption of blockchain games with their expertise and capabilities in delivering high-quality games and managing in-game economies.
However, user acquisition, retention, and survival during market downturns remain critical issues for all participants in the Web3 gaming industry.
Web3 Gaming Public Chain Data
In September, the distribution of games across various public chains remained relatively stable, with BNB leading with a distribution rate of 30.9%; Ethereum followed closely with 24.7%; and Polygon accounted for 14.9%. In contrast, the second tier, including Wax, EOS, and Avalanche, each accounted for less than 5.5%, highlighting the gap between them and the first tier.
Data Source: Games Shared by Chain
Since 2022, the distribution of games across different public chains has shown a consistent trend. With the booming Web3 gaming market, there are expectations for more new public chains to emerge to challenge the long-standing dominance of the top three public chains.
Data Source: Monthly Games by Chain
In September, the total number of games with over 1,000 active users on BNB, Polygon, and Ethereum was 228. Among them, BNB had the largest share at 21.0%; followed by Polygon at 17.1%; and then Ethereum at 4.8%. On Polygon, 39 games attracted over 1,000 active users, accounting for 8.6% of its total on-chain games, while BNB's ratio was 5.3% and Ethereum's was 1.5%.
On September 28, Sui announced the launch of the Web3 gaming portal Play Beyond, which has launched 18 different types of games. This portal provides users with the opportunity to delve into their favorite games while also offering resources to learn about Sui blockchain technology for game development and iteration. The portal focuses on providing a seamless gaming experience without requiring users to understand cryptocurrency knowledge. This aligns with the trend of 2023—emphasizing immersive and enjoyable gaming experiences rather than complex underlying technologies.
Web3 Gaming Project Overview
In September, 13 gaming projects saw their token prices significantly surge, with increases exceeding 20%. This sustained growth rate demonstrates the potential of these projects and their ability to attract investor attention and interest in the vibrant GameFi space.
Data Source: Game Token Price Changes in September
Nakamoto Games is a gaming platform built on the Polygon chain that offers various on-chain games through a "play-to-earn" model. The platform's native token has garnered significant attention in the GameFi space, rising by 80.4% just this month. Since the beginning of this year, the token's value has surged by 661.0%, which is impressive.
Nakamoto Games
Web3 Gaming Investment and Financing Situation
The investment and financing heat in the Web3 gaming sector remains stable, with eight rounds of financing this month attracting substantial investment amounts. These financings include significant investments in various types of companies and projects, including GAM3S.GG ($2 million), BulletChain ($2 million), BlockGames (undisclosed), GamePhilos ($8 million), Podium (€200,000), Salvo Games ($150,000), Fableborne ($780,000), and Proof of Play ($33 million).
Fableborne
Notable investment firms like a16z have shown signs of participating in "bottom-fishing" strategies. It is worth noting that from June to August 2023, a16z's investment activity was relatively low, with only one investment per month. However, their recent resurgence is evident, as they made four investments in September, including a notable investment in Proof of Play.
Proof of Play, a crypto gaming company led by FarmVille co-creator Amitt Mahajan, successfully raised $33 million in seed funding. This round was co-led by a16z and Greenoaks. FarmVille is the most popular game in Facebook's history, with over 300 million players. Proof of Play's first game is a social role-playing game called Pirate Nation.
Pirate Nation
This article is contributed by the Footprint Analytics community.
