Blockchain gaming activity remained mostly stable this month outside of big bursts of activity in projects like Yuga Labs’ Otherside and the return of Sunflower Lands (formerly Sunflower Farms). Unique active wallets (UAWs) didn’t move much in either direction other than shuffling around among (mostly) the same games. Network distribution of NFT activity saw a big shift this month due to heavy Ethereum activity from a few projects, plus Solana showing an increasing foothold. There were numerous alphas and updates released this month, but few new games created much of an impact. There was a huge drop in fundraising for games, but hopefully this is just a hangover from a big March. As more games get released over the next couple quarters, we should experience an acceleration in activity.
We dive into these trends and their drivers in more detail below.
Unique Active Wallets
- Per DappRadar, blockchain gaming UAWs increased a very small amount — only 1% — month-over-month to 1.22 million. Of course, if you look longer-term, this number has been more or less flat since September. As we’ll see below, it’s also worth noting that the activity of many of the most popular games actually saw small increases.
- Axie Infinity saw a large decrease at least partially due to the shift over to Origin, and many other lagging games are struggling to build and pivot toward sustainable economies that are requisite for longer-term growth. Overall, the blockchain gaming space is in a brief waiting period as many new games are recently dropping closed or open alpha releases, indicating a likelihood of higher game activity by the end of summer. May might be too early to see any big changes in UAWs, but the summer months should likely see some uptick (or at least notable new entrants).
- As a reminder, UAWs are not a perfect indicator of users. A user can have more than one wallet - potentially overestimating actual user activity. Conversely, a user can play a game but not transact with a blockchain over a period of time - potentially underestimating actual user activity.
Top Games by Unique Active Wallets
- Splinterlands not only reclaimed the top spot in April but experienced 30% growth in UAWs despite no big changes to the game this month. The only significant development the game saw in April was the announcement of SPS validator nodes, but this is unlikely to be responsible for the uptick in wallets. It is worth noting that in stark contrast to the many other collapsing game economies out there, Splinterlands has managed to maintain a fairly stable economy, with a token value hovering above the $0.001 soft-peg price for over 6 months.
- The two games that managed to drop hard out of the top 10 to the 15th and 16th spots are Axie Infinity and Crazy Defense Heroes, respectively. Crazy Defense Heroes previously experienced a major bump due to promotional activity, which has now ended, so it’s not surprising to see it decline in active wallets. However, there’s plenty of potential for reinvigoration, since it’s a successful game even without the blockchain features. Axie Infinity “classic,” on the other hand, is basically in a death spiral and is slowly being replaced by Axie Infinity: Origin. Earnings from the game are currently too low for most traditional play-to-earn players to justify playing it, and many scholar-types have likely moved on to the alpha of Origin, other blockchain games, or have left the blockchain gaming ecosystem altogether.
- Pegaxy and Sunflower Land (the relaunch of Sunflower Farmers) made their way back into the top 10 in April. Obviously, the 10,131% growth of Sunflower Land is representative of the game’s relaunch after being shut down because of bot-driven and bad design-driven network congestion problems. It’s not a true indicator of the game’s growth. The revamped game introduces some anti-bot features and majorly reduces the amount of on-chain transactions, which will reduce gas fees and prevent it from causing problems on Polygon again. It remains to be seen if the game can maintain growth, since its economy design makes earnings significantly lower for late joiners, which decreases the incentives that will help drive user growth. We’ll take a deeper look another time.
- Speaking of farming games, Farmers World also saw decent 29% growth and moved up a spot over the still decaying Bomb Crypto player base. Galaxy Blocks also managed to hold its spot while other Thundercore games like Jelly Squish (44% growth) and the recent Color Craze (93k UAWs in just over a week) threaten to join the top 10. SecondLive (45% growth) and Arc8 (49% growth) also saw some decent traction in the 11th and 12th spots, respectively.
- Transaction volume recovered well this month, but a large part of it was driven by Yuga Labs’ Otherdeeds land sale on the last day of the month. Yuga Labs’ other NFTs like BAYC/MAYC also continued to see significant trading, and all the Yuga Labs NFTs being part of the Otherside metaverse project helps with that. The other huge NFT push in April was the debut of Moonbirds ($502M in transactions), which sat as the #2 transacting collection of the month. As we’ll see below, the activity of these projects alone was enough to give Ethereum 90% of NFT trading activity this month. In fact — and to the chagrin of many buyers — Ethereum gas fees during the Otherdeeds sale hit record-breaking highs.
- Solana also saw some growing traction (7% of NFT volume) as projects — like the hit move-to-earn game StepN and future 2022 releases like Aurory — started ramping up on the blockchain. The market share of networks like Solana, Polygon, and Avalanche will likely increase as more games get released. In the aftermath of the Otherdeeds sale, even Yuga Labs mentioned that it would consider building its own chain for future releases to avoid Ethereum’s bottlenecking. That being said, Ethereum is still considered the primary network for NFTs, especially for non-game NFTs. Of course, with OpenSea onboarding Solana NFTs, moves like this will also help grow multi-network trading, as not everyone wants to use multiple marketplaces. It’s also worth keeping an eye on growing gaming-focused Layer 2 chains like Immutable X, which looks to expand beyond Gods Unchained, with Illuvium and Guild of Guardians forthcoming (among many other projects).
- Overall, the NFT market has managed to show some resiliency in the face of reduced hype as speculative assets (along with the stock market in general) have taken a hit. However, given the enormous capital and talent flows into blockchain games, the usage of NFTs in games should grow (in fits and starts) for the foreseeable future.
- As a reminder, Cryptoslam only accounts for NFT volumes in the secondary market. It also only includes data on the following blockchains: Ethereum, Solana, Avalanche, Ronin, Flow, WAX, Polygon, Panini, Tezos, BSC, and Theta.
Top Games by Transaction Volume
- The obvious standout this month is Otherdeed NFTs, which made a big splash on April 30th. While it takes the top spot by an order of magnitude this month, it may drift down or off the list as hype cools. Below that, however, Crabada essentially still manages to hold its own at the top despite a sharp 47% drop in month-over-month transaction volume. Axie Infinity also managed to hold the #3 spot despite yet another month of major decline.
- WebbLand is actually the only top 10 holdover from the previous month that managed to see positive growth, although it only moved up one position from 7 to 6 as a result. Metroverse City Block took a pretty big hit, moving down 2 spots with a 62% drop, and it wouldn’t be surprising to see it hit the bottom or drop off if some other soon-to-release games present compelling NFTs.
- This month, there are 3 newcomers to the list besides Otherdeeds: Apeiron, Aurory, and Blockchain Brawlers. Blockchain Brawlers is the only one of the three that’s currently playable, and it’s the first Wax-based game to make the list since Farmers World dropped off. Like many blockchain games, it is still a work in progress, with new content and features still to be released (like the recently announced PvP mode designed by the famed Richard Garfield). The game is likely to drop off the top 10 list next month, but it remains one of the stronger Wax games alongside Alien Worlds and Farmers World.
- Aurory has yet to release, but an actual usage for its NFTs in the form of “expeditions” drove the spike in trading volume, which may wane until the game is released. Apeiron is still a ways off from its targeted closed beta release in July, but its NFTs seemed to attract a good amount of early adopters, which bodes well for when they release Star NFT Land in June.
- This month, we saw a notable month-over-month dip down in fundraising activity, as a big share of funding went towards non-games. Keep in mind, March saw a few outsized funding events. Also, there is still a lot of fund-based capital yet to be deployed, as well as capital accumulated by networks like Polygon, Immutable, Solana, and Avalanche that will eventually support games on their respective networks. Given the major issues of leading P2E games like Axie Infinity, as well as a broader decline in valuations, many investors are likely rethinking their approaches and being more disciplined and methodical in what they choose to fund. Even though nobody likes to see reduced activity, this increase in discipline is ultimately healthy for the space.
- Foonie Magus saw a notable $10M funding round, which pairs well with its NFT sale for Apeiron, as we covered above. Civitas also received a decent $10M round for what may be the first (but not the last) 4X blockchain game, a successful mobile genre. It was good to see some smaller games like Goons of Balatroon and First Light Games’ Blast Royale get funding, even if it wasn’t a large amount. With so many games getting funded last month, there were fewer new games needing seed funding this month; of course, this is a trend that may reverse again in the months to come.
Big thanks to Devin Becker for writing this essay! If Naavik can be of help as you build or fund games, please reach out.