Assessing Blockchain Gaming Resilience in Q2 Amid Crypto Winter
Blockchain gaming market was resilient in Q2 and Data from Blockchain Game Alliance (BGA) and the blockchain data research platform DappRadar has shed light on an unexpectedly bullish blockchain gaming market in the middle of the crypto winter. While the value of cryptocurrencies plummeted dramatically in the second quarter, the gaming industry continued to thrive. DeFi, NFTs, and the crypto token market were all in the red in the second quarter of 2022.
Gaming has defied the odds, and venture capitalists continue to pour money into the industry. Already, the amount invested in blockchain games this year is 33% higher than the amount invested in the previous year. Also, by the end of this calendar year, the market is expected to bring in more than $12 billion. The second quarter saw the same amount of venture capital investment as the first three months of the year. It also surpassed the $4 billion in capital raised in 2021 as a whole in terms of total dollars.
Even more encouraging, game and metaverse-related ventures have received a significant amount of funding. Furthermore, there has been a notable outflow of talent from major traditional gaming companies to web3 game startups. Also, a t the end of the quarter VC company Andreesen Horowitz unveiled a $4.5 billion fund to invest in blockchain games, the metaverse, and other crypto economy categories.
Blockchain gaming increases share of UAW
Reduced market activity has also allowed the blockchain gaming segment to boost its percentage of Unique Active Wallets (UAW). In the second quarter, gaming Dapps accounted for 52% of all blockchain activity. However, the overall volume of UAW for games decreased by 7% in Q2 compared to the same period last year. Nonetheless, this was less than the 17% decline in DeFi activity and the 24% decline in NFT activity. To top it all off, blockchain gaming activity is up by a staggering 233% from the same quarter in 2021.
The sharp decline in the overall NFT activity was evident in the gaming industry as well. In comparison to the previous quarter, gaming NFT organic revenues decreased by 29%. Having said that, blockchain gaming NFTs fared better than most, despite the overall decline in NFT sales volumes of 82% compared to the previous quarter. In addition, the value of in-game assets was also significantly impacted by the decline in the value of numerous game-related cryptocurrency tokens.
As of the end of the third quarter, the most popular blockchain game is still Splinterlands, which had 283,729 UAW in use. On the flipside, the user base of Axie Infinity, a well-known blockchain game, has decreased 83% since the end of Q1. This is the result of a recent hack that resulted in the theft of native tokens valued over $600 million.