In 2022, the Web3 gaming sector experienced an influx of investors, with venture-backed startups raising $4.49 billion. However, this influx of capital hasn’t been able to attract and retain users.
A recent study conducted by a Web3 and metaverse information website researched the startups focussed on WEb3 and their earnings. As per the study, 348 startups focused on NFTs, metaverse, gaming, artificial intelligence (AI), virtual reality (VR), and augmented reality (AR) raised a total of $7.1 billion last year.
On the other hand, venture funding across the Web3 space has risen by $4.8 billion since 2021, which marks an approx 48% increase in one year. Sources reveal that the majority of this funding went to Web3 gaming projects. At present, Web3 gaming accounts for 62% of Web3 venture capital funding.
As per figures, in 2022, venture capital investments into gaming startups totaled roughly $4.49 billion, the largest sector by venture funding. However, the investments in the sector are disproportionate to the size of its user base. For example- the metaverse projects were in second place, with $1.8 billion in funding.
This represents the confidence of venture funds in the potential the future of Web3 gaming holds. Reportedly, the majority of Web3 funding comes just from four major venture funds. These are Paradigm ($2.5 billion), a16z ($2.2 billion), HiveMind ($1.5 billion), and Binance Labs ($1 billion).
As per figures, gamers generally don’t share the same confidence given the low user adoption. In addition, the majority of gamers are not either familiar with Web3 or are not in support of it.
Various studies in the past year have suggested the status of the mass adoption of Web3 in the gaming sector. For example, in June last year, a poll by a gaming company surveyed 7,000 gamers from the US, UK, and Japan.
As per the poll, only 3% of the participants own non-fungible tokens (NFTs), the assets that have been hailed as a technology that will transform ownership of in-game assets.
In addition, around 52% of gamers are completely unaware of the Web3 gaming terms, and only 12% of gamers have tried playing a Web3 game. Out of the Web3 gamers’ lot, only 15% opined that they are interested in doing so. The survey also found out that in-large gamers don’t like crypto or NFTs.
The executives of several gaming companies have also opined that the most difficult these days for them is onboarding gamers.
However, the feelings of developers have been a bit different than gamers. A week back, Todayq News reported a survey from Coda Labs, a blockchain entertainment company, wherein most participants—75%—plan to continue working on Web3 projects.
In addition, more than half of study respondents think Web3 will completely change the game business. Some people think that Web3 will affect user enrolment and retention. 40% feel that integrating Web3 will increase the number of new users, while 36% think doing so will improve game user retention.