The revival of blockchain games: How are the former two giants Axie and STEPN positioning themselves?

Author: flowie, ChainCatcher

With the recovery of the blockchain gaming market, the former two giants of blockchain games, Axie and STEPN, have recently been quite active.

Axie has showcased three major strategies: on one hand, it is focusing on the game sidechain Ronin Network; on the other hand, it is upgrading the classic game Axie Classic and attempting to open new growth channels in Web2 through IP merchandise sales. Meanwhile, STEPN is more focused on launching its second blockchain game, Gas Hero, using GMT as the game token. During this market uptrend, the monthly increase in AXS and GMT tokens has also reached around 20%.

Axie Showcases Three Major Strategies, Strong Growth of Game Sidechain Ronin

Since the blockchain gaming market began to recover in October, Axie has actively capitalized on the trend, focusing primarily on three areas.

First, the game sidechain Ronin Network, developed by Axie's team Sky Mavis, has shone brightly. According to CMC data, its token RON is currently priced at $1.56, with an increase of nearly 100% in the past month and over 30% in the past week.

In addition to the token growth, Ronin's on-chain data has also seen a good increase. According to a post by Jef Zirlin, co-founder of Ronin and Axie Infinity, on December 9 on platform X, the number of monthly active addresses on the Ronin network has reached 572,000, with daily active addresses at 144,000.

Ronin was originally launched as an Ethereum sidechain by Axie Infinity in February 2021, created due to Ethereum's insufficient performance and high gas fees, which could not support the phenomenon that is Axie Infinity. In May 2021, Axie migrated to Ronin. As the largest application on Ronin, Axie Infinity has long been mutually dependent on Ronin; when one thrives, so does the other, and vice versa. However, as Axie fell into a death spiral at the end of 2021, Ronin's on-chain data also began to decline. The large-scale attack in March last year, which resulted in a loss of over $600 million, not only caused a crash in Ronin's TVL and token but also led to a severe trust crisis for both Ronin and Axie.

After encountering this black swan event, Ronin did not "give up." With the recent recovery of the blockchain gaming market, Ronin's significant growth can be attributed to its continuous efforts in network and ecosystem development.

On one hand, the Ronin network has been continuously upgraded to improve performance. In October, Ronin announced the launch of the Lucas (v2.6.2) upgrade and the Shillin hard fork on its mainnet. The Lucas version implemented several protocol improvements, including Optimistic Fast Finality (REP-0003) and REP-0002. Among them, REP-0003 proposed a new fast finality mechanism that significantly enhances the transaction confirmation speed on Ronin.

On the other hand, Ronin has actively collaborated with well-known game studios, with many popular games migrating to the Ronin ecosystem this year. At the end of October, the P2E blockchain game Pixels migrated from the Polygon network to Ronin.

This has brought a large number of new users to Ronin. According to Footprint Analytics data, the number of active addresses on Ronin exceeded 70,000 on November 7, a 238% increase compared to a week earlier; the number of on-chain transactions reached 196,000, setting a new high since late March. (Recently, Ronin's data has shown explosive growth, with the number of active user addresses at the beginning of November increasing sixfold compared to the previous month.)

According to Ronin Daily statistics, the Ronin network has now integrated at least 10 games, whereas a year ago, there was only Axie on the network.

In addition, Ronin has partnered with several well-known game studios. For example, at the beginning of November, Sky Mavis announced a partnership with South Korean game production company ACT Games, which plans to migrate all its games to the Ronin network. Among them, ACT Games' trading card game (TCG) Zoids Wild Arena has already migrated from Polygon to Ronin. Shortly after, in early December, Sky Mavis announced a collaboration with Singapore game developer Foonie Magus, which plans to bring its new game "Apeiron" to the Ronin blockchain. The demo of Apeiron is available for download on the Epic Games Store. Additionally, Sky Mavis has collaborated with game studios such as Directive Games, Bali Games, Tribes Studio, and Bowled.io, which will utilize the Ronin network to develop games.

With the frequent onboarding of games on the Ronin blockchain, many of them have migrated from Polygon. Recently, the community speculated that The Sandbox plans to migrate to the Ronin chain based on SAND token transfer information from the Ronin testnet.

In addition to expanding its gaming business, Ronin is also actively expanding into domain services and wallets. For instance, in mid-November, Ronin Domain Service (RNS) opened for public sale. On December 1, Ronin Wallet partnered with Binance Pay, allowing users to exchange assets held on Binance, such as BTC and ETH, for Ronin chain assets like AXS, SLP, and USDC. On December 6, the DeFi protocol Impossible Finance will also deploy its Launchpad on the Ronin network, enabling developers and game studios on Ronin to launch their own ERC-20 tokens. Additionally, products released on this Launchpad may require staking RON, AXS, and IDIA tokens for distribution.

In addition to its efforts on the Ronin Network, Axie Infinity has recently followed the example of blue-chip NFTs like Pudgy Penguin and Doodles by selling IP merchandise. At the end of November, Axie announced the launch of its online store, Merch Store, and official merchandise, which includes Squishmallow-style plush toys, $300 statues, branded hoodies, t-shirts, and baseball caps. Besides selling official products, Sky Mavis is also attempting to take the UGC route, encouraging specific Axie NFT owners to create and sell their products. Axie owners can now utilize their NFT characters as mascots to run various businesses, including Axie-themed cafes, comics, restaurants, or toy series.

To reach more Web2 users, Axie Infinity has also announced a partnership with Philippine ride-hailing giant Grab to launch a user rewards program. Users can access the Merch Store through the Grab app to purchase merchandise. According to Sky Mavis, 20% of the net profits from merchandise sales will be allocated to the Axie treasury.

However, it is worth noting that according to Axie market data, currently, out of 11.9 million Axie Monster NFTs, fewer than 5,000 have lifted commercial restrictions, accounting for only 0.04% of all Axie Infinity NFTs. Since the launch of the online store, there has been no significant effect on either the discussion heat or community growth.

In addition to focusing on the sidechain Ronin and IP merchandise sales, Axie has also embraced nostalgia with the return of its classic series Axie Classic after an upgrade. Axie Classic has added a new game mode, "Cursed Arena," attracting players to pursue rewards.

According to Axie, within just four days of the return of its flagship game Axie Classic, the platform's weekly active user count has exceeded 100,000. Meanwhile, AXS has also risen by 10%.

Currently, Axie's efforts on the game sidechain Ronin appear to be the most robust. With the potential arrival of a blockchain gaming summer and more well-known games onboarding, Ronin may see new growth. Recently, OKX has launched perpetual contracts for RON, and many users in the crypto community are looking forward to its listing on Binance and other exchanges.

STEPN Focuses on New Game Gas Hero, Is It Effective for GMT?

Compared to Axie's multi-faceted layout, STEPN seems to be concentrating its efforts on its second self-developed game, Gas Hero.

In July this year, the STEPN development team Find Satoshi Lab first announced plans to launch the large-scale multiplayer online (MMO) game "Gas Hero." Gas Hero is deployed on Polygon and stated that it will not introduce a new game token but will use STEPN's token GMT as the game token. Furthermore, STEPN's generous support for Gas Hero reflects its importance. When the game was looking for creators for character art, the STEPN development team Find Satoshi Lab rewarded approximately 2 million GMT tokens and promised to pay 2% in royalties.

The game setting and development speed of Gas Hero also highlight its ambition. It is reported that the initial player capacity of the game is about 130,000, but the gameplay and technical framework can be expanded to over 6 million. Less than half a year after the official announcement, on November 27, Gas Hero officially launched community testing. This round of testing opened up testing qualifications to 3,000 community users, including holders of Gas Hero NFT badges, Find Satoshi Lab ambassadors, partners, and other groups. It is expected that once the closed beta test is successfully completed, the official version will be launched in December.

As a new work from the once phenomenon game STEPN, Gas Hero has naturally attracted considerable attention. Currently, its Twitter follower count has surpassed 50,000. What are the characteristics of Gas Hero? The project leader Johnny (@johnnyL37020770) revealed in an AMA in July that the Gas Hero game model attempts to address three major challenges that Web3 game design needs to overcome: how to achieve a Web3-native social approach; how to ensure comfortable output and recovery methods for various assets; and how to handle the impact of economic cycles.

Specifically, the characteristics of Gas Hero are as follows: first, the game's architecture needs to place all players within a shared world social system. Each settlement has 9 players, each guild has 9 settlements, and each district has 9 guilds. Gas Hero hopes to reach at least several million users across the game, so when designing cities, districts, guilds, settlements, and bases, this scale needs to be considered.

Moreover, the game has established a tree-like world structure, where each unit has its corresponding manager, who considers issues such as the benefits and obligations of power, power design, and the combination of power and fame from the base level to the highest level. For example, the map structure above the guild level also involves some governance-related buildings, such as management departments, town halls, and the United Nations. Players need to continuously enhance their status through various means.

Additionally, the core design of the game revolves around the supply and demand of resources. "Gas Hero features a wide variety of resources, each with specific consumption demands; capturing the cycles and changes of individual items will become an important aspect of the market economy."

According to feedback from participants in the internal test, compared to STEPN, Gas Hero's game story setting and play-to-earn model are richer. The entire game background narrates the story of surviving humans fighting underground to revive humanity on the surface after a nuclear war in a future world with limited resources. Players, as survivors, need to join cities, guilds, and tribes to connect with other players collectively and earn rewards through personal adventures and collective battles in guild wars and tribal wars. Currently, many game items are also performing well in the Mooar market.

The analysis from Snap Research Institute indicates that Gas Hero's game model is quite similar to the mobile game "Princess Connect Re:Dive" from the well-known Japanese mobile game company Cygames, which is known for its generous benefits. Whether Gas Hero will inherit Cygames' legacy remains to be seen.

Compared to Gas Hero's game model, users may be more concerned about the impact of Gas Hero on the growth of GMT.

After experiencing a death spiral, STEPN has made several attempts to activate the GMT ecosystem, including launching the decentralized exchange Dooar and the NFT market MOOAR, but none have achieved significant results in the deep bear market. Currently, after the market recovery, Dooar's TVL is around $7.5 million, but there hasn't been much recent activity, and MOOAR has not seen much movement since its launch at the end of last year, until recently when MOOAR and STEPN announced a joint launch of a genesis sneaker, which has already surpassed a total transaction volume of $75 million.

In addition, similar to Axie, STEPN is attempting to acquire new users by onboarding Web2 channels like Apple Pay and Apple Music, but the results so far have not been significant.

Gas Hero's current efforts coincide with the overall recovery of the crypto market and the warming of blockchain games. In the game setting of Gas Hero, whether it is enhancing game characters or in the play-to-earn model, a large amount of GMT is required, which initially seems to be a positive factor for GMT, with the token price having risen nearly 50% in the past two months.

However, in the current blockchain gaming market, there have yet to be more breakthrough and validated economic models to address the sustainability issues of blockchain games. Whether Gas Hero can attract a large number of players to empower GMT like the former STEPN remains to be observed.

Conclusion

For the two phenomenon games, Axie and STEPN, the massive user base accumulated in the previous cycle is their greatest advantage. In the deep bear market, both Axie and STEPN have attempted various self-rescue models to maintain their ecosystems, but the results have been unsatisfactory. With the rise of new blockchain games like Big Time and Fusionist, the landscape of the blockchain gaming market is being rewritten, and Axie and STEPN need more immediate measures to solidify their positions in the industry.