2022 was a big year for the play-to-earn (P2E) gaming industry. The market is still reeling from the influx of capital users and users and a sharp decline in token prices and players. The prospects for play-to-earn seem grim, considering the FTX catastrophe’s impact on every industry sector. However, looking deeper into the numbers, you will see hope for significant “building” in 2023.
A steady stream of strong raises from Web3 gaming studios has flooded the market with funds for months. UnCaged studios raised $ 24 million in August. That month, this contributed to $750 million in funding for Web3 gaming studios. Revolving Games raised $25m in September, while Odyssey Interactive and SkyWeaver brought in $19, $30, and $40 million, respectively. Thirdverse raised $15M for Web3 and virtual reality (VR) games in November.
These numbers directly contradict the plummeting asset prices and the player’s enthusiasm for the Web3 gaming area. Even though tokens and gamers are struggling, venture capitalists have big hopes for blockchain gaming’s future. What studios will be victorious in the coming year? Why?
Instead of betting on speculation, VCs bet on experience
One thing that has stood out in the recent raises is the fact that most studios that have been funded are not participating in seed or pre-seed rounds. They are instead holding Series As.
There are exceptions to the rule. Some studios have been successful in pre-seed or seed rounds. Even then, the founding teams are seasoned bitcoin gambling. Ruckus Games is an example of a game studio founded by former Riot Games and Gearbox developers. This is a departure from early Web3 gaming days when VCs tended to focus on games-related studios.
Many Web3 gaming projects were funded early without a clear plan or founding teams. The YOLO days in late 2021 and early twenty22 are gone. The studios receiving funding today have already demonstrated success in building Web3 games. VCs now look further into the future, sometimes even five to ten decades.
Related: Play-to-earn Gaming will die in 2023
This timeframe might seem like a lifetime in crypto, but it is normal for traditional gaming studios. Studio owners realize that games can be rebuilt over time and are looking for more long-term investment options.
What will the future look like for crypto gaming?
When paired with the long-term trends in Web3 Gaming, these raises show that certain patterns are starting to shape the industry’s future.
What will the effect of all these raises in a few years?
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Mobile gaming will be a major focus. DappRadar reported in September that mobile gaming with a hyper-casual approach to blockchain technology brought more than 1.7 million users from Web2 to Web3 gaming within a week.
These changes are likely to make Web3 gaming more mainstream. Within five years, there will be a global index of the top 100 gaming studios with strong blockchain elements.
Here’s to the long-term game
The large-scale raises in Web3 gaming have continued for months, and we probably won’t see them end. The Web3 gaming hype has officially ended, and the industry is now in “build”. Investors are now interested in studios playing long games (pun intended).
This shift in focus and the large fluctuations in the wider blockchain technology industry will create new opportunities for builders in P2E in 2023. Both players and funders have high expectations. This will help to separate the wheat from the chaff. In 2023 and beyond, the priority will be quality rather than quantity. The ultimate winner will be those who create outstanding games. Let’s get to it.