According to a recent report from DappRadar in collaboration with the Blockchain Game Alliance, the crypto gaming industry has experienced a booming phase. Reportedly, the gaming industry comprising of games utilizing blockchain-based tokens or NFTs, experienced a remarkable influx of investment last month, securing a collective total of $297 million.
Sources reveal that the collection in the past month marks a significant increase from the previous months. Data suggests that out of it, a significant 63% of the funding is directed towards the sector in the past month was sent for infrastructure development.
This allocation reflects the industry’s nascent stage of growth thus the large requirement for infrastructure. Simultaneously, it is important to note that the pouring investments mark investors interest on tools and platforms that will facilitate the emergence of crypto and NFT-driven games.
Additionally, the investments in July marks an increase from June, which witnessed a comparably modest $68 million injected into the crypto gaming space. To this, the report lists the regulatory uncertainties as one of the affecting factors. The report cited the examples of U.S. Securities and Exchange Commission’s (SEC) lawsuits against two major crypto players- Binance and Coinbase from early June.
However, some experts including Carlos Pereira, a Partner at Bitkraft Ventures, warns against grasping too much into the monthly fluctuations. He suggests that variations in investment levels might simply be a consequence of sample size and timing, with several major deals possibly spanning both months.
Additionally, it is important to note that the trend of hefty investments in the crypto gaming space is reinforced by the fact that the sector received over $400 million in funding for each of the preceding three months—March through May 2023. The report claims that insights monthly analyses are often tenuous given that many funding deals remain unannounced or face delays in public disclosure.
Alok Vasudev, co-founder of Standard Crypto, a venture capital firm, reveals that the gaming landscape is complex considering the extended development timelines of games. Despite this, he counts gaming as a prime use case for crypto, anticipating a continued uptick in investments within the sector.
Furthermore, the report states that although certain metaverse-focused companies continue to raise funds, the existing landscape experienced a downturn in NFT prices and overall trading volume. According to the report, virtual world games also recorded a yearly low of just $5.6 million in traded volume across 10,796 sales in July, as outlined and the average sale price per NFT stood at $523.
As the crypto gaming industry continues to attract substantial investments despite witnessing fluctuations, it shows the growing relevance of blockchain technology and NFTs within the broader gaming landscape. However, considering the traded volumes, the sector’s trajectory remains uncertain, despite the trend of continuous funding suggesting ongoing interest in the innovative fusion of cryptocurrencies and gaming.
Nonetheless, the sector has marked its presence in the wider technical landscape and has received attention from giants. The recent introduction of in-game non-fungible tokens (NFTs) by e-commerce giant Amazon for its prime subscribers offers an exciting glance into the future of gaming and digital ownership.
This aligns with Amazon’s broader technological pursuits and showcases its dedication to shaping innovative experiences for users. In a similar move, last year, Sony Interactive Entertainment had filed a patent for an NFT framework aimed at revolutionizing the gaming industry.