Blockchain-based games want to go mainstream, but the million-dollar question is: What’s the best way to do it?
According to some web3 game developers, there might not be just one right answer.
To win Web 2.0 audiences over, it appears the industry will have to meet them where they are. To do that, web3 game devs should move web3 components to the back end and avoid promoting games as being based on web3, according to Sumeet Patel, founder of NFT-based algorithmic prediction game Exiled Racers.
That makes sense to me. When using applications, people don’t really care about what’s going on behind the scenes. They just want something that’s easy to use and does what they want it to. While some people may want to understand the technology and dive deep, the majority don’t really care.
“It doesn’t sound good, but gaming doesn’t need blockchain today, but blockchain does need gaming,” said Nicholas Douzinas, business development and growth lead at decentralized gaming platform Ajuna Network.
The global gaming industry is expected to grow from $282 billion in 2023 to $666 billion by 2030, as more people increasingly choose video games as their primary form of entertainment, and 4G-enabled smartphones enable people everywhere to indulge in mobile games, according to a report by Fortune Business Insights.
But blockchain gaming wasn’t even mentioned as a trend or driving factor for gaming growth. I think that’s fair because it’s such a small fraction of the market and has a long way to go before it can even make a dent in the industry.
“NFTs mean nothing to gaming; some people don’t care about ownership,” said Douzinas. But on the other side of the spectrum, some people want to engage deeply with web3 technology, he noted.
Ajuna Network aims to attract people who are interested in web3 technology and blockchains but are comfortable with owning a token and the possibilities that come with it, Douzinas said.
Not all gaming companies are taking that route.
Some studios like Mythical Games are tucking away the web3 components and only introducing them to gamers when needed, while other startups are “completely the opposite, leaning into the technology with limitations, blocktimes and tokens,” from the beginning, Douzinas told me. Both models may be able to coexist, he believes.
Some people come into the web3 gaming space and are crypto-focused, hoping to triple or quadruple their funds. “It’s about profits to them,” John Linden, CEO of Mythical Games, told TechCrunch+. “But that’s not what we’re building for.”
That’s not to say there aren’t people interested in web3 games and the art that usually accompanies it. “It’s new people interested in the space who are picking up these games not for financial reasons, but are curious and want to explore,” Patel said.
That tracks. Sometimes people want to just pick up a game and play it, while other times people want to do that and, as they become more invested, dive deeper into the functionality. However, if someone tossed a million instructions, definitions and terms at me right from the beginning, I’d probably close that game and find something less involved.
For people new to web3, it’s important that the user experience is good and intuitive. “If it’s not easy to understand or use, no one is going to use it regardless if it’s Web 2.0 or web3,” Patel said.
The avalanche of information you’re buried with when entering the world of web3 games can be overwhelming for a lot of people, regardless of how well-intentioned that flood of information is. And it doesn’t help that NFTs generally carry a negative connotation in the mainstream, Patel said. “People don’t mind buying digital assets as in-game currencies, skins or other elements, but they don’t like that it’s associated with an NFT. So as that sentiment and term fades away, more people will adopt.”
Last week, Mythical Games raised $37 million in funding as part of its Series C1 round. “The full round is expected to close later this year with an additional $20 million to $30 million raise,” the company said.
As the company grows, it’s also seeing growth with “big strategic partners in sports and gaming looking to make investments,” as well as traditional players eyeing the space, Linden said.
Mythical Games in late April launched NFL Rivals, a digital collectible card game. Within the first 45 days, it had over 1.1 million players, he added.
But the key to success, he believes, is slowly introducing web3 technology to gamers and making it optional. “We aren’t using industry jargon anymore; we’re just putting out games. It’s about functionality,” he said.
That approach reminds me of when someone’s trying to explain a new board game to me — they usually lose my attention before we even begin playing. I’d imagine that’s what happens with gamers new to crypto who are trying out a web3 game that highlights web3 terms.
“We don’t force them to have it all at once,” Linden said. “Some people say this isn’t true web3, but we just educate people on the way that the assets [in the game] are tradable, sellable. We think that works better with consumers [as they get to] explore on their own and see how to play with those parts of the system.”
In a similar vein, the vast majority of Exiled Racers’ target audience are Web 2.0 “lightweight gamers,” not web3 or traditional gamers, Patel said. The project hides its web3-related infrastructure to lend a Web 2.0 experience to the game. “Once a user needs a wallet or wins a reward, we slowly get them interested in web3.”
So far, this approach seems to have paid off for Mythical Games: About 10% to 15% of its revenue comes from secondary market sales, Linden said. And it seems the people who like it, really want more. On average, gamers play for about two hours per day spread across 18-minute sessions, Linden said. “The most important thing is people are playing it, coming back and playing often.”
If web3’s secondary market revenue grows to 30% to 40%, it’s going to be “hard to avoid” this industry, Linden said. Right now, big gaming companies in Asia and Europe are still watching the industry, and “we’ll see more and more groups come in — big companies are waiting for that breakout,” he added
Douzina compared web3 gaming to the early days of mobile gaming, which started off with simple games like Snake.
In the near term, Linden expects there will be three or four games that bring in over 10 million players this year. Once web3 gaming hits the 50 million gamer threshold, the wider industry will be involved “in some fashion,” he said.
All in all, the majority of the web3 gaming business in the long-term “will look more like gaming than crypto,” Linden predicts. “That’s naturally where it’s going to go.”