The Rise and Fall of Web3 Gaming: A CoinGecko Report. ๐ฎ๐ฏ๐ฐ
GameFi sector thrives in the crypto industry, attracting investments and user engagement. Despite success, CoinGecko's report hints at a concerning outlook for Web3 gaming.
Web3 Gaming Overview:
Web3 gaming emerged as a promising use case, allowing users to earn rewards and tangible value. Historically, substantial funding (over $2 billion in 2023) fueled growth and attention.
The Grim Reality:
CoinGecko's report reveals a troubling statistic - three in four gaming projects fail. Over 2,800 Web3 games launched in the past five years, but 2,100 have shut down. Annual failure rate averages at 80.8% from 2018 to 2023, spiking to 95% during bear markets.
Yearly Trends:
2021 experienced a lower failure rate at 45%, suggesting some stability. 2022, however, marked the worst year, with a failure rate of 107.1% and over 500 game closures. 2023 shows signs of improvement, with a lower failure rate and potential industry stabilization.
Positive Indicators:
DappRadar reports Blockchain gaming reaching 1 million daily unique active wallets in October. Despite challenges, 33% of the industry's activity is still commanded by Web3 gaming.
Industry Concerns:
CoinGecko categorizes projects as inactive when 14-day active users drop by 99% from peak. Recent market downturn raises concerns about investor confidence in the Web3 gaming sector.
Key Takeaways:
Web3 Gaming remains pivotal but faces challenges in sustaining projects. Industry trends show resilience, especially during market recoveries and bullish trends.
