Crypto gaming’s shrinking market cap hasn’t scared off investors

Blockchain games have had a very bad year. On average, crypto gaming tokens have lost three-quarters of their market capitalization year-to-date.

Even the largest crypto gaming tokens have fallen out of favor. The native tokens of DecentraLand (MANA) and The Sandbox (SAND) have dropped in value by -78% and -85% year-to-date, respectively.

It seems to get worse every month. The market capitalization for SAND declined by 8% in the past 30 days. Axie Infinity’s AXE token price decreased by 10% and its token SLP by 15% in the same period. WAX blockchain’s WAX dropped 12%.

According to a DappRadar report, 40% of Axie Infinity players have quit since the Ronin bridge hack in March.

Protos has covered the decline in recent weeks. We previously reported on the implosion of play-to-earn games, virtual land, and the metaverse. Nevertheless, investors continue to deploy capital into crypto gaming. After all, the industry is nascent with forecasted growth into the trillions of dollars by 2030.

Read more: Helium insiders owned majority of crypto tokens, Forbes reveals

Investors continue to fund crypto gaming infrastructure

Despite the bear market, in the second quarter of 2022, venture capitalists invested another $2.5 billion into blockchain gaming. A16z created another $4.5 billion “Crypto Fund 4″ to focus on blockchain gaming investments, creator monetization, and digital asset infrastructure development.

VCs seemingly remain confident in the industry’s prospects, with $748 million invested in blockchain gaming and metaverse properties in August 2022.

• Solana-based gaming platform Fractal launched Fractal Developers to support those building blockchain-based games. It includes APIs for adding a sign-in tool for non-custodial wallets and in-game marketplace creation.
• Mythical Games is building a chain that will be compatible with Ethereum Virtual Machines. CEO John Linden said the firm had been working on a testnet version, but Ethereum fees were too high to justify releasing it until the Merge occurred.
• NVIDIA chief Jensen Huang announced Omniverse Cloud Services, its first software-as-a-service. Huang called it a platform for artists, developers, and enterprises interested in creating metaverse properties.

Some crypto games are doing well

• BNB-based gaming platform MOBOX claims to operate six games with 3.5 million registered players. It reported growth in August, launched a digital asset marketplace, gave away in-game loot to Coinbase Wallet users, and signed a small sponsorship deal with Polkastarter Gaming.
• Benji Bananas recently reported a 15X increase in monthly active users and a more than 100X increase in monthly transactions in September.
• SplinterLands completed three billion battles and reached 168,000 daily unique active wallets since its brand refresh in June. It announced that the Major League Soccer Players Association planned to use SplinterLands for a play-to-earn virtual soccer game.

Although the positive news in crypto gaming is sparse, for context, the industry is larger than DeFi. Active users of blockchain games outnumber users of DeFi apps. 885,431 on-chain users interacted with games in September; DeFi apps earned 402,965 active users in the same month.

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