Home Analysis What happened in 2022 and where is the industry heading?

What happened in 2022 and where is the industry heading?

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This annual report examines cross-chain data from the blockchain industry to outline the most important metrics and trends in GameFi for 2022.

By looking at last year through the lens of on-chain analytics, we can chart the trajectory of the GameFi industry and make smarter investment decisions and analysis in 2023.

By the numbers, 2022 was a devastating year. Investors, GameFi participants, and NFT holders have witnessed a sharp decline in the value of their holdings after hitting record highs. Those who were more unlucky lost all their assets because they were involved in the collapse of Terra, BlockFi, Celcius, FTX or other smaller projects that failed or were hacked.

Despite this, well-known game studios continued to invest heavily in GameFi. Analysts predict that if blockchain games become more playable, they will become one of the primary means of driving mainstream crypto adoption.

But until then, most GameFi projects still fail. That means those in the blockchain industry need to go beyond headlines and whitepapers to determine what is happening within the protocol and judge its sustainability.

When does on-chain analytics come into play?

For Players and Private Investors: Gaming still struggles to get out of its death spiral, and GameFi investments still resemble Ponzi schemes, aimed at getting in early in a project and exiting before it goes down. . If you’re playing games primarily for fun, you should be very careful for on-chain signals that indicate an impending decline.

For developers: Developers should carefully track cross-chain trends as the choice of launch or expansion platform can greatly affect the success of a project. Considerations include ecosystem support, user base, and performance. The GameFi project evaluation takes these factors into account.

finally, If you are a VC or media outlet researcher, your job depends on generating accurate insights about the GameFi industry. This report examines the underlying data.

Answer the following three questions:

  1. What’s the most important statistic for 2022 and how will it affect the outlook for the GameFi industry?
  2. What were your most important projects last year and how did they impact blockchain gaming?
  3. Which networks are attracting GameFi development and why?

Main findings

whole market

  • GameFi token dropper market cap jumps from $27 billion at the beginning of the year to $3.3 billion by the end of the year
  • GameFi’s monthly transaction volume dropped significantly, from $3.1 billion in January to $80 million in December, a 97% decrease.
  • However, the number of transactions in blockchain games remains relatively constant, bouncing within the 130-185 million band.
  • In total, BNB attracted the largest number of new projects, at 296
  • However, Polygon, Wax, and Solana grew in relative numbers, doubling and tripling the number of projects compared to 2021.

Financing and investment

  • GameFi fundraising increased 83% compared to 2021, with $5.4 billion invested against $2.9 billion
  • Despite the bear market, major studios continued or started to enter GameFi.
  • The biggest funding event happened in April, when Epic Games, the studio behind Fortnite, raised $2 billion led by Sony for its Metaverse project.
  • Animoca cemented its position as GameFi’s most active leader, closing 61 rounds, more than double the second most active investor.
  • Animoca also received the second highest funding after Epic Games at $434 million.

GameFi user

  • More users don’t correlate with more volume or more transactions on GameFi, making it difficult to form a complete picture of activity on the chain.
  • However, Wax has the highest average daily active users, followed by Hive and BNB.
  • Depending on your outlook, this could indicate the strength of Alien Worlds and Splinterlands, or the prevalence of bots in these games.
  • Among the top 5 chains by active users, Polygon grew the most with a 381% increase

project overview

  • GMT will have the highest average GameFi token volume in 2022 at $541 million.
  • Solana has become the go-to chain for Move-to-Earn projects on both STEPN and Walken
  • Of the top 5 games by average GameFi token volume, MANA saw the biggest year-over-year decline, at -55.6%.
  • Splinterlands and Alien Worlds were the most actively played games in 2022, with an average of 383K and 228K active users respectively.
  • There are no long-awaited so-called AAA blockchain games such as Illuvium or Phantom Galaxies launching in 2022.

whole market

The overall market in 2022 was tough. Judging by the price of GameFi tokens or his NFTs, the whole industry seemed to have stalled.

But looking beyond the most superficial numbers, despite the loss of value, there were some very optimistic signals in the industry. However, other ecosystems have attracted developers and created more innovation.

  • GameFi token market cap drops by 87%

From $27 billion at the beginning of the year to $3.3 billion at the end of the year, market capitalization occurred when the price of all crypto altcoins collapsed amid tightening macroeconomic conditions. Perhaps an optimistic indicator of the future, he was also one of the highest performing assets during the 2021 bubble. This shows that investors see blockchain gaming as a high-risk yet incredibly high-growth opportunity.

  • 97% decrease in monthly GameFi transaction volume

The monthly volume decline was perhaps the most disturbing statistic from last year. However, it is important to note that this does not reflect overall activity. As the price of the GameFi token has fallen, so has the amount of volume calculated on the amount of USD value exchanged within the protocol.

  • The number of transactions hovered between 130 million and 185 million.

The number of transactions has had its ups and downs, but has remained relatively constant, unlike the sharp declines tracked by the overall volume metric. It means that most of the activity was maintained. (Or perhaps that bot.)

Weekly GameFi Transactions
Weekly GameFi Transactions
  • In total, BNB attracted the largest number of new projects, at 296

BNB has attracted many light games and small projects due to its ease of development and low network fees. Few of these titles have been hits, and BNB has yet to join a game on the scale of The Sandbox, Illuvium, or Axie Infinity.

Number of GameFi protocols per chain
Number of GameFi protocols per chain
  • Polygon, Wax, and Solana more than doubled the number of projects

Polygon has doubled the number of GameFi protocols from 153 to 306. Wax increased 158% from 53 to 137 games. Solana is only two games away from him in 2021, but in 2022 he broke through with 19 new titles.

GameFi Funding in 2022

  • GameFi fundraising increased 83% compared to 2021

$5.4 billion in investment was paid into the GameFi sector, compared to $2.9 billion in 2021. In 2021, institutional investors were still being swept away by the novelty of so-called “blockchain games” as Axie Infinity, The Sandbox, and Decentraland made headlines. first time.

In 2022, GameFi could become a truly disruptive force if massive amounts of VC cash were used to build ambitious projects by traditional game studios and established blockchain companies. It was the year that people realized something.

GameFi investment in 2021 and 2022
GameFi investment in 2021 and 2022
  • Major studio invests in GameFi

The most notable examples are Sony, Epic Games, Ubisoft and Nintendo.

Epic Games, the studio behind Fortnite, has raised $2 billion to build its Metaverse, led by Sony. Details are still unknown as of early 2023, but plans are including legoThis was the most significant fundraising milestone of the year.

GameFi Project Funding Amount and Timing in 2022
GameFi Project Funding Amount and Timing in 2022
  • Animoca has become Gamefi’s most influential agency

The studio and investor cemented its position as GameFi’s most active leader, completing 61 rounds, more than double the second most active investor. At $434 million, he was also the second highest funding recipient after Epic Games.

Animoca is the company behind The Sandbox, Benji Bananas, Arc8 and Phantom Galaxies.

Number of GameFi projects by investor
Number of GameFi projects by investor

GameFi users in 2022

  • Wax had the highest average daily active users, followed by Hive and BNB.

Throughout 2022, Splinterlands (Hive’s main title) and Alien Worlds (Wax’s) were evenly matched in terms of active users. Depending on your outlook, this could indicate the strength of Alien Worlds and Splinterlands, or the prevalence of bots in these games.

Average daily active users per chain in 2022 compared to 2011 growth
Average daily active users per chain in 2022 compared to 2011 growth
  • Polygon grew the most, with a 381% increase in active users for the top 5 chains.

Polygon is an EVM L2 built to scale up Ethereum. The project dates back to 2017 and its token, his MATIC, went live in 2019, but the network had its breakout year in 2022, showing span performance across DeFi, NFT, and GameFi. Polygon’s games with the highest average monthly DAU in 2022 were Planet IX (70K) and Benji Bananas (25K).

project overview

  • GMT will have the highest average GameFi token volume in 2022 at $541 million.

STEPN was the last big hit in the bull market and one of the only game-changing titles to make headlines by introducing mobile app-based “Move-to-Earn” gameplay. But a month after his NFT asset sneakers and tokens ballooned into the sky, the game entered a death spiral and prices crashed. The game is still Solana’s second most played game.

Average GameFi Token Volume (2022 vs 2021)
Average GameFi Token Volume (2022 vs 2021)
  • Solana struggled in the aftermath of FTX’s collapse, but became the go-to chain for Move-to-Earn projects

Apart from STEPN, the “Walk-to-Earn” title Walken is also built on Solana.

walken - user
Walken – User

  • MANA is -55.6% of the top five GameFi tokens, showing the steepest year-on-year decline

This reflects a loss of confidence in the company’s game, Decentraland. Decentraland was one of his big three titles on GameFi and the Metaverse, along with The Sandbox and Axie Infinity, and was widely recognized for its exorbitant prices for in-game assets.

  • Splinterlands and Alien Worlds had an average active user count of 383K and 228K respectively.

These were the most actively played games in 2022. As previously mentionedSplinterlands and Alien Worlds, are both card and text-based games without 3D worlds, making them surprisingly primitive for market leaders.

Weekly/Monthly GameFi Stats
Weekly/Monthly GameFi Stats
  • There are no long-awaited so-called AAA blockchain games such as Illuvium or Phantom Galaxies launching in 2022.

As of early 2023, Illuvium is already in beta, with a full version expected in mid-2023.

This work, footprint analysis

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