Krafton Partners With Solana Labs
Last week, Krafton — the publisher of the popular PUBG franchise — announced a partnership with Solana Labs. According to the press release, “The two companies will cooperate in the marketing and design of blockchain games and various blockchain technologies, as well as jointly cooperate on investment opportunities.” Like most big publishers, Krafton is looking to wade into the web3 waters methodically. It has already made small investments in a handful of web3-based companies (mostly related to art / avatar NFTs), but this is its first commitment into blockchain games, specifically.
It’s too early to know what type of blockchain-based games Krafton is looking to develop. The vast majority of Krafton’s $1.6 billion in revenue (in fiscal 2021) came from its PUBG games, and even though it’s unlikely that Krafton will put blockchain functionality into the core battle royale games anytime soon, it wouldn’t be surprising to see Krafton pursue blockchain games within that IP universe. There’s also motivation for the company to diversify beyond PUBG and find new growth opportunities (as evidenced by last years acquisition of Unknown Worlds, the developers of Subnautica and more), which may be a factor at play here, too. Even though we don’t know the exact terms of the relationship, it’s likely that partnering with Solana Labs reduces the cost/risk of development for Krafton. It should also lead to strong deal flow for ongoing investments opportunities. It will be interesting to see what type of game Krafton wants to build on Solana first.
As for Solana, this is clearly a high profile win. As we broke down previously, Solana has already done a good job attracting emerging game developers, but this announcement is a testament to Solana’s usefulness to companies with large, existing player bases, too. Previously, Ubisoft announced its partnership with Tezos (which struck us as somewhat random), and many large companies have yet to partner with specific platforms yet. We expect more companies to follow in Krafton’s footsteps, and we think Solana, Immutable, and Polygon are generally the top three L1/L2s to partner with right now, although competition is still, of course, heating up.
- In connection to the mega-launch of ApeCoin, Animoca Brands is adding ApeCoin-driven P2E elements to its existing mobile game, Benji Bananas. Link
- Guild of Guardians, a mobile RPG published by Immutable, launched its closed alpha. Link
- GMoney launched Brick Breaker, a game stored that’s entirely on-chain. Everyone can play but only holders of the 2.5k NFTs can record their high scores. Link
- Chicken Derby, a chicken racing game, launched its open beta. Link
- Get a sneak peek of Axie Infinity: Origin’s upcoming ear cards. Link
- MetalCore, an open world MMO space combat game powered by Immutable, dropped its reveal trailer. Link
- Yuga Labs raised an additional $450 million at a $4 billion valuation led by Andreessen Horowitz. Between recent acquisitions, the launch of ApeCoin, and fundraising, Yuga Labs is experiencing serious momentum. Link
- Joyride, a mobile web3 game development platform, raised $14 million in seed and follow-on financing led by BITKRAFT Ventures and SuperLayer. Link
- Another blockchain gaming platform, C2X raised $25 million in a private token sale at a valuation of $500 million; the round was led by FTX Ventures, Jump Crypto, and Animoca Brands. Link
- Haun Ventures, a newly created fund from Katie Haun who was mostly recently a GP at Andreessen Horowitz, raised $1.5 billion in capital for web3 platforms: a $500 million early stage fund and a $1 billion acceleration fund. Link
- Trailerblazer Games, which is building fantasy game Eternal Dragons, raised $8.2 led by Makers Fund. Link
- Block Tackle, which is making a skateboard NFT game called SkateX, raised $5 million in a seed round led by Play Ventures and Cadenza Ventures. Link
- Third Time raised $3.5 million for an NFT-based horse-racing game led by London Venture Partners. Link
- KlayCity, a Klaytn Blockchain based metaverse project, raised $3.75 million in a seed and private round funding led by Krust and Animoca Brands. Link
- Big Time, a multiplayer action RPG, conducted its Exalted SPACE token sale on Friday. Link
- FTX acquired Good Luck Games, the makers of card-based game Storybook Brawl with plans to introduce NFT elements. There’s also a Twitter thread with some of FTX’s rationale. Link
- Heroes of Mavia partnered with Tribe Gaming, an esports organization, to better establish the game’s esports potential. Link
- Enjin is partnering with CryptoBlades, which will bring many players over to Efinity (Enjin’s new blockchain built on Polkadot). CryptoBlades is one of the first games to be available cross-chain including on Avalanche, Polygon, and more. Link
- Yunit Guild announced a partnership with CyBall to onboard and educate more players. Link
- Nakamoto Games is adding the easy creation of in-game tokens to its SDK alongside a unique staking/burning system for 3rd parties. Link
- Stripe, in collaboration with FTX and Blockchain.com, will begin using Stripe Connect to provide fiat on and off ramps. Link
Notable Market Moves
- Due to GDC activity, our tracking cut off a couple days early this week. Next week we’ll provide a fuller picture of price movements, including notable jumps experienced at the end of the week.
- The big, new entrant is Yuga Labs’ (makers of Bored Ape Yacht Club) ApeCoin, which jumped straight to the number 3 spot and knocked Illuvium out of the top 10. While it’s hard to say whether it will retain its high value and the hype will stick, it’s massive funding will definitely lead to new Ape-related games (see the Benji Bananas item further up) and experiences over time.
- Axie Infinity is still creeping towards the alpha of its huge Origin update, so the AXS token will be an important asset to keep an eye on in the coming month or so.As always, who knows what will happen over the next week, but all of the building going on points to clear long-term growth and inevitable churn in the top 10 list.
Content Worth Consuming
- Move & Earn: Why STEPN is paying people as much as $100+ per day to go for a short walk (Decrypting Crypto): “In this episode we interview Yawn Rong, one of the co-founders of STEPN. STEPN is one of our favorite new play & earn apps that is probably best described as a version of Strava or MapMyRun on the blockchain. New players are earning ~$25 each day for doing 10 minutes of walking, whereas some power users are earning as much as $400+ each day! Don't miss this one.” Link
- Justin Hulog: Chief Studio Officer at Immutable (Guardians United): “Justin, Time at Riot, South-East Asia, Traditional gaming companies compared to crypto, NFTs, Chief Studio Officer, Aspirations, Favourite games.”
- The Future of Play to Earn Gaming (Empire): “Jason and Santiago are joined by Gabby Dizon (co-founder YGG) and Felix Sim (co-founder Salad Venture) for a deep dive into crypto-gaming guilds. We discuss the future of play-to-earn (P2E) and how guilds provide the core infrastructure necessary for gaming's exponential growth. This is a must-listen if you're curious about how P2E economies work, how guilds add value to the gaming ecosystem, or where P2E gaming is headed in the next 5 to 10 years.” Link
- Predicting the rise of intentionally unsustainable Ponzi games in web 3 (Evolution of Web3 and NFT Gaming): “The slow pace of traditional game development, the gambling & money-focused mindset of the crypto audience, and the vast amounts of investment that could be deployed for the chance of a return, suggests that there could be an increase in Ponzi “games” that have intentionally unsustainable economies.” Link
- NFTs as the top of the funnel (Vance Spencer, @pythianism Twitter thread): “NFTs are top of funnel; they are inherently visual and leg off of an established collectible culture that can reach a market of billions. Fungible tokens are middle of funnel; they can be issued to users programmatically to bootstrap usage, retention and monetization of a product.” Link
- Why we closed our Sandbox position (Rendezvous Equity, @RendezvousEq Twitter thread): “Per our initial investment thesis for Sandbox, we argued if they could cannibalize 1% of Roblox and Minecraft MAUs (350m players) this would bring 3.5m players. While this may still be attainable, there have been recent market developments which act as a further roadblock.”