Author: Stella L (stella@footprint.network)

Data Source: Blockchain Game Research Page

In June 2024, the cryptocurrency market experienced a significant pullback, with Bitcoin falling by 7.3% and Ethereum dropping by 9.8%. This fluctuation inevitably affected the blockchain gaming sector, leading to a 28.1% shrinkage in the market value of gaming tokens. Additionally, the daily transaction volume of blockchain games increased by 8.0%, but the daily active users (DAU) decreased by 8.8%, falling to 3 million. Key industry developments included extensive discussions on the future of Web3 games, Ronin's announcement of the upcoming launch of its Layer 2, and significant changes in user engagement in games such as Pixels and Matr1x FIRE. As the blockchain gaming industry continues to evolve, its core focus remains on leveraging blockchain technology to create sustainable and engaging gaming experiences.

The data in this report is from Footprint Analytics' Blockchain Game Research Page. This is an easy-to-use dashboard that includes the most important statistical data and indicators for understanding the blockchain gaming industry, and it is updated in real time.

Macro Market Review

In June, the cryptocurrency market experienced a pullback. The price of Bitcoin slipped from $67,730 at the beginning of the month to $62,795 at the end of the month, a decrease of 7.3%. Similarly, the price of Ethereum also declined from $3,820 at the beginning of the month to $3,444 at the end of the month, a decrease of 9.8%.

Data Source: Bitcoin and Ethereum Price Trends

Sustained selling pressure from multiple sources dealt a heavy blow to Bitcoin. On June 24, the trustee in the Mt. Gox bankruptcy liquidation announced that the repayment work for Bitcoin and Bitcoin Cash (BCH) would commence in July 2024, triggering widespread uncertainty in the market regarding the conversion of assets to fiat currency by creditors and the specific timetable. Meanwhile, the U.S. spot Bitcoin ETF experienced net outflows of funds in the second half of June.

Government actions were also noteworthy. A German government agency began liquidating Bitcoin confiscated in 2013 and transferred nearly 4,000 Bitcoins to exchanges in June. Additionally, the U.S. government transferred 3,940 Bitcoins seized from a convicted drug dealer's wallet to Coinbase.

Although the U.S. spot Ethereum ETF made smooth progress, Bitcoin's weakness seemed to spread across the entire crypto market.

Overview of the Blockchain Gaming Market

In June, the total market value of blockchain gaming tokens decreased from $27.2 billion to $19.6 billion, a significant decline of 28.1%. This sharp decline directly reflected the widespread downward trend in gaming token prices, which was attributed to the lackluster performance of Bitcoin and the entire cryptocurrency market.

Data Source: Market Value of Blockchain Gaming Tokens and Bitcoin

The average daily transaction volume of blockchain games was 8.6 million transactions, an increase of 8.0% compared to the previous period.

Data Source: Daily Transaction Volume of Blockchain Games

The overall industry DAU (calculated by wallet count) decreased to 3 million, a decrease of 8.8% compared to the previous period. This unexpected decline was mainly driven by the Pixels game on the Ronin network, which is one of the largest Web3 games calculated by DAU.

Data Source: Daily Active Users of Blockchain Games

After migrating from Polygon to the Ronin network in the fourth quarter of 2023, Pixels achieved significant growth in its DAU, reaching a peak of 1 million on May 13. However, its DAU sharply decreased from 976,000 on June 11 to 252,000 on June 19, a significant decrease of 74.2%. In comparison, the average DAU in May was 842,000, which decreased to 647,000 in June, a decrease of 23.2%.

Data Source: Daily Active Users of Pixels

Pixels Chapter 2 was officially launched on June 18, bringing not only improvements to the gameplay but also optimizing incentive design and reward distribution strategies to enhance the game's long-term sustainability. The Pixels team stated on social media that they are actively implementing a series of systematic measures to effectively curb bot activities in the game, claiming that "Chapter 2 has broken all bots."

The DAU of Pixels began to recover on June 20, reaching a level of 423,000 DAU by the end of the month. However, it is unknown how many of these users might be evolved bots. Longer observation and data accumulation are needed.

For Pixels and many other Web3 games, ensuring the economic unsustainability of bot activities is crucial.

Public Chains for Blockchain Games

In June, there were a total of 1,580 active games on various chains. Among them, BNB Chain, Polygon, and Ethereum led with market shares of 22.4%, 19.5%, and 16.1% respectively.

Data Source: Proportion of Active Games on Each Public Chain

At the same time, among the 3 million DAU, Ronin, Polygon, and NEAR continued to lead but also faced many challenges. Ronin's DAU share, influenced by Pixels, decreased from 29.8% at the beginning of the month to 18.4% at the end of the month. On the Polygon side, due to a 31.6% decrease in the DAU of its largest game, Matr1x FIRE, its DAU share also decreased from 15.1% to 8.0%.

Oasys' Layer 2 Saakuru Verse experienced significant growth in DAU in the last ten days of June. The three games successfully launched by Web3 game publisher PlayGround, namely Copycat Killer, Panic, and Parkour Battle, greatly boosted the surge in Saakuru Verse's on-chain DAU, rising from 18,000 on June 21 to 464,000 on June 30, with an average DAU of 379,000 in the last week. If this growth momentum continues, Saakuru Verse is expected to quickly rank among the top three blockchain platforms in terms of DAU.

On the other hand, opBNB also performed well in the last week of June, with an average DAU of 285,000, accounting for nearly 10% of all DAU.

Data Source: Daily Active Users on Each Public Chain

Public chains are actively strengthening their game ecosystems, including launching special grant programs for Web3 game developers. At the same time, building more chains has become a popular strategy. Ronin recently announced plans to build a Layer 2 using the Polygon Development Kit (CDK), indicating that popular games like Axie Infinity and Pixels are expected to operate on their dedicated game chains, a move that aligns with the strategies adopted by platforms such as Avalanche, Oasys, and SKALE. Will this strategy and similar approaches be successful? We will continue to keep an eye on it.

Overview of Blockchain Game Projects

In June, the blockchain gaming market had a total of 3,289 games, with 1,319 remaining active. It is worth noting that 257 games successfully attracted over 1,000 monthly on-chain users, accounting for 7.8% of all games and 19.5% of active games.

Data Source: Number of Monthly Active Blockchain Games

Data like this has persisted for some time, sparking discussions about "Are blockchain games dead?" While we do not agree with such exaggerated assertions, understanding the background is crucial. It is important to note that this data only reflects the number of on-chain users. In reality, many games offer gameplay without Web3 integration (such as without connecting a wallet), and their game data is mostly off-chain, making it difficult to accurately track this data at this stage. Therefore, the importance of blockchain technology and on-chain data is becoming increasingly prominent.

We have more chains (Layer 1, Layer 2, Layer 3, subnets, etc.), more games, and more DAU. However, we suggest not only focusing on the growth of DAU but also paying attention to the retention rates of each game. Retention rate, as a core indicator for evaluating the attractiveness and real user stickiness of games, can more accurately reflect the health and long-term development potential of games.

For example, despite a significant decrease in Pixels' DAU in June, its monthly retention rate has shown strong performance since migrating to the Ronin platform, reaching a high level comparable to or even better than Web2 games. Specifically, Pixels' average retention rate in the second month exceeded 40%, and by the sixth month, this number remained above 20%.

Data Source: Pixels Monthly User Retention Rate

In contrast, Matr1x FIRE had a retention rate of less than 10% for the second and third months among the new users it acquired in April and May. The game faces significant challenges in user retention.

Data Source: Matr1x FIRE Monthly User Retention Rate

Blockchain games, with unique elements such as play-to-earn, play-and-earn, and play-to-airdrop, stand in stark contrast to traditional games, but the fundamental fun of the game is always the core driving force. We must be vigilant and not let the excessive pursuit of potential earnings overshadow the pure enjoyment of the game. Building a long-term sustainable ecosystem for blockchain games is crucial for the healthy development of the entire industry. As we emphasized on social media: "Web3 games are not dead, Web3 games are under construction."

Investment and Financing of Blockchain Games

In June, the Web3 gaming sector raised a total of $43.05 million through 12 financing activities, with the specific amounts for 4 of the financing activities not publicly disclosed. This total is not significantly different from the $44.95 million raised last month.

​Investment and Financing Events in the Blockchain Gaming Sector in June 2024 (Source: crypto-fundraising.info)

The Sandbox, with a valuation of $1 billion, successfully raised $20 million through convertible notes, with the financing led by Kingsway Capital and Animoca Brands. Over the past year, The Sandbox team has been focused on improving the quality and quantity of user-generated content (UGC) globally.

On the other hand, Uniswap Labs announced the acquisition of a blockchain survival game called Crypto: The Game. This game quickly gained popularity on social media in its first season. In the game, players need to build tribes and determine the fate of tribe members through various challenges, with only the last survivor able to win. The team behind Crypto: The Game chose to join Uniswap Labs to leverage Uniswap's deep resources and experience in the blockchain and decentralized finance fields to further expand and develop the game.

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