The GameFi sector is planning a perfect comeback in 2024.
2024 could be a milestone year for GameFi, with multiple AAA games expected to be released. Will 2024 be the year blockchain shakes up the traditional gaming market?
GameFi games haven’t always had the best reputation among the general gaming public. Critics of the genre point to mediocre graphics, uninspired game mechanics, and a general lack of fun. Even more irritating is that the tokenized elements of GameFi games often struggle to sustain over the long term.
But if industry experts are to be believed, GameFi may be in for a complete makeover. Mark Long, CEO of Shrapnel, a AAA first-person escape-and-shooter game with an ecosystem for creators, is one of the voices predicting positive developments for the industry. Long is quick to admit that blockchain games currently have a mixed reputation, but he thinks the next wave of games will confound critics.
“One of the biggest things I foresee happening next year is a shift in the narrative around Web3 gaming,” Long told Cointelegraph. “Let’s face it, the perception of the genre is that blockchain games suck. Driven by Ponzi scheme mechanics that require a constant influx of new players to justify any accrued value. They’re not played to make money; they’re played to work.”
While Long is critical of the current crop of GameFi titles, he predicts that there are several "breakthrough" games in the pipeline that will change public perception.
“Two games I really enjoyed playing were Dead Drop and Off The Grid," said Long. "Dead Drop is creatively led by Dr. Disrespect, a man who plays by his own rules whose influence is right up front [...] Off The Grid has one of my favorite film directors, Neil Blomkamp, driving the design, and it looks fire. To me, Blomkamp’s world is a unique, grounded take on science fiction while also being surprising in very specific ways.”
The Shrapnel CEO also named Wildcard as another game he’s looking forward to, citing a development model that includes player ownership.
“GameFi provides an exciting new opportunity for Web2 gamers to do what they’ve always wanted to do: be part of game creation,” said Long.
A simple Ponzi scheme
Not everyone in the decentralized finance (DeFi) space is so excited about GameFi’s prospects for the coming year. Oleg Fomenko, co-founder of mobile money-making platform Sweat Economy, is highly skeptical of the industry.
Fomenko believes that the differentiated GameFi industry will never be able to challenge traditional gaming, and he believes the whole concept is wrong.
“The belief that games that simply incorporate Web3 elements automatically belong to GameFi’s unique category is rapidly fading,” Fomenko told Cointelegraph. “While Axie Infinity and StepN initially led us to believe they had created a whole new world of gaming where players could earn and live off their earnings, this turned out to be a temporary, disappointing phenomenon. These were simply Ponzi schemes that benefited early adopters who also knew when to jump on board early.”
Fomenko said that GameFi tokens would only capture value “if the games themselves generated value,” but “that’s not the case.” Therefore, GameFi itself is flawed.
Even so, the Sweat Economy founder does find some positives in the broader Web3 space. Fomenko continued, “Gaming with Web3 elements will thrive, and I’m excited to see further innovation in this space, especially around the use of non-fungible tokens (NFTs) in gaming.”
GameFi's Redemption Arc
GameFi will need to overcome the negative perception surrounding the industry if it wants to make a significant impact in 2024. That’s the judgment of Les Borsai, co-founder and chief strategy officer of Wave Financial, an investment advisor with more than $1.5 billion in assets under management.
“Looking ahead to 2024, GameFi is at a critical juncture in its development,” said Borsai. “Its current state is frankly underwhelming, and it is often criticized for prioritizing blockchain and DeFi gimmicks over true game quality. This approach has caused a backlash from the gaming community, who feel that the essence of the games is obscured by obvious monetization strategies and unappealing mechanics.”
Borsai believes there are opportunities for the industry if it can capitalize on other new technology trends such as artificial intelligence (AI) and digital twins, which, in Borsai’s view, present “GameFi with a chance to redeem itself.”
“For GameFi to make a real impact and win back gamers in 2024, it will need to fundamentally reevaluate its approach,” said Borsai. “It must go beyond advanced technology; it needs to seamlessly integrate those elements into games that players actually want to spend time playing. If GameFi can achieve this balance, it has the potential to not only mature, but also significantly change the way we think about integrated financial gaming.”
Complex business
Creating AAA games is no easy feat. Cutting-edge games typically take two to five years to develop and bring to market. Some games take even longer. Grand Theft Auto VI, for example, is scheduled to launch in 2025—a full 12 years after its predecessor.
The lengthy development process illustrates how difficult game development is, even without the added complexity of integrating blockchain technology.
Teddy Pender, technical product manager at Mina Protocol, a zero-knowledge (ZK) native blockchain, believes that the implementation of zero-knowledge technology could potentially simplify processes.
“In the past, Web3 gaming applications have been criticized for having sparse user interfaces and poor gaming experiences. However, 2024 will be a turning point when we see the GameFi application start to look and feel like a true competitor to the existing Web2 gaming industry,” Pender told Cointelegraph. “By using a ZK-native blockchain, developers can build games that leverage the zero-knowledge framework, reducing the complexity of the GameFi application.”
Whether ZK-proofs or other technological solutions help propel the industry forward with renewed vigor, some believe the industry still has a long way to go before it can hope to catch up with traditional games.
There's still a little time
Rob Greig and Josh Jones, co-founders of Cornucopias, a multiplayer online video game built on Unreal Engine 5, agree that 2024 will be a landmark year for the industry.
“The potential for 2024 is huge: we’re looking at a scenario where individual ownership of in-game assets, powered by blockchain technology, is not only a novelty, but ultimately the new norm as it continues to evolve,” Jones told Cointelegraph. “This shift promises to unlock unprecedented opportunities and user engagement, making it a pivotal moment for developers and gamers alike.”
Yet, despite this, the duo believes that the industry is not quite ready to mature in the coming year.
“The industry is at a crossroads,” Greg told Cointelegraph. “Looking ahead, 2024 looks like a pivotal year [...] where studios cautiously dip their toes into cryptocurrency-related initiatives and test the waters before fully committing. 2025-2026 is where we’ll likely see mass adoption in gaming.”
Whether or not 2024 is GameFi’s breakout year, advocates like Long are hoping the next wave of games can start to turn the industry around.
"As the years go by, the traditional centralized model seems to be getting tired. I think players are ready for something truly new," Long said.
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