In 2024, the Web3 game industry will present a complex situation, making significant progress while also facing many challenges. Although the number of daily active users has surged by more than 300%, and traditional game companies have begun to make specific arrangements in this field, judging from market performance, the market value of this sector only increased by 60.5%, significantly lagging behind the Meme currency and AI sectors. As Bitcoin hits new all-time highs and various crypto sectors thrive, a key question emerges: "Have Web3 games missed the best opportunity to develop in this bull market?"

Behind these superficial figures, however, 2024 marks an important period of transformation for the industry. The industry has moved from a purely speculative stage to maturity. This report will analyze how Web3 games will evolve through the 2024 market cycle, exploring the sector’s key metrics, technological advancements, and strategic shifts. From infrastructure development to user engagement models, we'll explore how the industry can build sustainable growth while addressing mainstream adoption challenges.

Note: Unless otherwise stated, all data in this report are as of December 15, 2024. Data sources are Footprint Analytics and CoinMarketCap.

Overview of annual key indicators

Market capitalization: reached US$31.8 billion, an increase of 60.5%;

Transaction volume: $5.2 billion, up 18.5%

Number of transactions: 5.3 billion, down 30.3%

Daily active users: 6.6 million at the end of the year , an increase of 308.6% compared to the beginning of the year;

Active games: 1,361 out of 3,602 games funds remain active (37.8%);

Annual financing: 220 financing events, totaling US$910 million;

Leading public chains:

Transaction volume proportion: BNB chain (23.1%), Ethereum (17.6 %), Blast (9.2%);

Proportion of transactions: WAX (33.6%), Aptos (11.6%), Ronin (6.1%);

Daily active users: opBNB (2.2 million), Ronin (1.10 million), Nebula (458,000) (December daily average)

Market performance analysis market capitalization performance

Web3 gaming sector will achieve strong performance in 2024. growth, but underperformed other crypto sectors. According to Footprint Analytics, the market value of gaming tokens reached US$31.8 billion at the end of the year, an increase of 60.5% from the previous year. Although the sector hit a record high in March. A year-to-date high of $47.4 billion, but still significantly below the record high of $114.1 billion set in November 2021

While the overall crypto market performed strongly in the second half of 2024, especially the last two months of the year led by Bitcoin, gaming tokens lagged other sectors. CoinMarketCap Data shows that Web3 games rank eighth among the top ten sectors in terms of market value growth, significantly lagging behind the leading sectors: Meme Coin (421.1%), AI and Big Data (168.0%) and Solana Ecosystem (124.1%). p>

This is poor performanceIt also extends to community attention. Among the most watched sections on CoinMarketCap, Web3 games accounted for only 6.7% of the views in the top ten sections, ranking ninth, because the focus throughout the year was mainly on Meme coin-related projects.

Transaction volume analysis

Key indicators of the Web3 game sector in 2024 Performance was mixed, with transaction volume growing but the number of transactions continuing to decline.

Transaction volume trends

The total transaction volume of Web3 games in 2024 will reach $5.2 billion, an increase of 18.5% from 2023. While reversing the downward trend from 2021, trading volumes remain significantly below previous cycle highs. The 2024 figure is only 6.2% of the 2021 peak ($84.1 billion) and 15.1% of the 2022 volume ($34.5 billion).

Transaction number trend

The total number of transactions in 2024 will reach 53 billion, down 30.3% from the previous year. This level, while comparable to 2021's 5.1 billion transactions, failed to reverse the downward trend that began in 2022.

User Engagement

Daily Active Users (DAU) in 2024 Significant growth was achieved throughout the year, from a daily average of 1.6 million in January to 6.6 million in December, an increase of 308.6% during the year. This growth surpasses the previous cycle peak of 1.8 million DAU created in November 2021. While this data may include some bot activity, this increase still demonstrates significant user engagement in this industry.

Ecosystem Development Public Chain Competition and Evolution Analysis of Main Public Chain Performance

In 2024, there will be significant changes in the dominance of different public chains in Web3 games, with each chain showing different advantages in terms of transaction volume, number of transactions, and user participation.

Transaction volume distribution of each chain

BNB chain maintained its dominance in terms of transaction volume, achieving $1.2 billion in transaction volume (23.1% market share), followed by Ethereum with $920 million (17.6%). Blast and Ronin accounted for 9.2% and 9.0% market share

Number of transactions per chain

Although the overall number of transactions in the industry fell by 30.3%, some public chains showed strong performance. WAX led the way with 1.8 billion transactions (accounting for 33.6% of the total). Aptos relied on its "tap- Tapos, a Telegram game with the "to-earn") model, suddenly emerged, reaching 620 million transactions (11.6%), of which 540 million were generated in August alone. Ronin and opBNB maintain 321 million and 318 million transactions respectively

Number of users of each chain

User activity on each chain has shown significant growth, especially in the second half of 2024. opBNB has suddenly emerged in terms of user engagement, with average daily active users reaching 220 in December million, surpassing the long-term leader Ronin (1.1 million). Nebula, a SKALE Layer 2, ranked third with an average DAU of 458,000, ranking among the top ten in DAU, demonstrating the expansion of the competitive landscape of the ecosystem and the Users’ willingness to try new platforms

The trend of diversification in the use of various chains shows that the ecosystem is becoming increasingly mature, and different public chains are finding their own positioning for various gaming experiences and user preferences. Major networks no longer just provide basic blockchain facilities, but develop Become a comprehensive platform for game developers. Arbitrum Foundation’s 2 billion ARB game catalyst program, Starknet Foundation’s 50 million STRK token distribution program, and important Grants from Sui and Xai plans, all demonstrate how each chain can attract and retain high-quality game projects through strategic incentives

Technical infrastructure improvements and capacity improvements

Blockchain processing capabilities have improved significantly. The current transaction processing volume per second of the network has increased by more than 50 times compared with four years ago. This growth is due to the rise of the Ethereum Layer 2 and Layer 3 networks. , including Immutable zkEVM, game chains based on Avalanche L1, Oasys, SKALE, Arbitrum Orbit, and other high-throughput blockchains such as Solana, Sui and Aptos.

The game-specific chain has also made significant progress. Ronin announced its Layer 2 plan Ronin zkEVM in June 2024, allowing Ronin developers to create their own zkEVM Layer 2. Immutable zkEVM takes a strategic step towards greater accessibility by removing deployment whitelisting and enabling permissionless deployment. Additionally, Avalanche completed its first deployment in 2020. The most important "Avalanche9000" upgrade since the launch of the mainnet in 2017 focuses on solving the obstacles of customized L1 construction and improving interoperability

Gas cost reduction

Ethereum's "Cancun" upgrade in March 2024 (also known as "Proto-Danksharding" or "EIP-4844") is an important milestone that significantly reduces L2 Network fees. The impact is significant, with gas fees dropping from a few dollars to a few cents or even less, eliminating one of the biggest friction points faced by blockchain game developers and players

Improved cross-chain interoperability.

Chainlink Cross-Chain Interoperability Protocol (CCIP) in 2024

The adoption of standardized formats for digital assets, particularly ERC-721 and ERC-1155, has become more widespread. These standards ensure that in-game NFTs can be recognized and used across a variety of games and platforms, simplifying asset transfers and interact.

2024 will also see the significant rise of decentralized platforms that support cross-chain gaming.Platforms such as al, Fractal ID, and Web3Games provide the necessary infrastructure for seamless asset transfer and interaction between different blockchain ecosystems.

Project Development

2024 is an important year for the development of Web3 games. In addition to the entry of traditional gaming companies, the ecosystem has also witnessed several major game launches. Highly anticipated games like Off The Grid and MapleStory Universe enter early access, while Illuvium is finally officially live. Pirate Nation successfully completed its Token Generation Event (TGE) and launched its successful “play-to-airdrop” campaign.

Active game analysis

As of November 30, 2024, the total number of blockchain games reached 3,602, an increase from 2,997 in January increase. However, the active games indicator shows some challenging trends. Among the total number of games, only 1,361 (37.8%) remain active on the chain, that is, 2,241 (62.2%) are inactive. Additionally, while the total number of games grew, the number of active games fell from 1,387 in January.

In-depth analysis of user engagement indicators shows further market concentration. The number of games with more than 100 monthly active users (MAU) fell from 586 in June 2022 to 522 at the end of 2024. In November 2024, 161 games (4.5% of the total) achieved more than 10,000 MAU, and 96 games (2.7% of the total) exceeded 100,000 MAU.

This user concentration trend shows that the market is maturing. Successful games are reaching larger audiences. This phenomenon is affected by multiple factors, including fierce competition, rapid iteration strategies, and the "head effect" formed by top games in the ecosystem.

Innovative Landscape Cross-Platform Game Trend

Mobile games emphasize accessibility and seamless user experience. In the 20th24 years establishing itself as the premier platform for Web3 games. A mobile-first approach has influenced the way developers design blockchain games, focusing on intuitive interfaces and streamlined onboarding processes. Mobile games will account for 29.4% of new Web3 games released in 2024.

Social platforms, especially Telegram, have become powerful catalysts for Web3 game adoption, accounting for 20.9% of newly released Web3 games. Telegram's success stems from its large user base, streamlined in-app experience, and ability to bypass traditional app store restrictions. The platform's influence peaked in the third quarter of 2024, with 11 games surpassing 10 million MAUs. It is worth noting that TON has successfully transformed this huge user base into on-chain participants, creating spillover effects in Web3 games, Meme coins and the DeFi sector. This success has prompted multiple blockchain networks outside of TON to compete for Telegram traffic. Aptos, Sui, Core, etc. have launched or supported games based on Telegram.

Similarly, Line announced the launch of 20 The plan for a mini-dApps marks the growing interest of mainstream messaging platforms in integrating blockchain games.

The console gaming space remains relatively untapped when it comes to Web3 games, with major manufacturers Microsoft and Sony maintaining a cautious stance. However, new approaches are beginning to emerge to bridge this gap. Some developers, like Gunzilla Games' Off The Grid, choose to separate core gameplay from blockchain functionality in line with traditional console game expectations. At the same time, blockchain platforms have begun to develop their own Web3 game consoles, such as Sui's SuiPlay0X1 and Solana's Play Solana Gen1 (PSG1), potentially creating a new category of dedicated Web3 game devices.

The entry of traditional game companies

2024 marks a major change in the attitude of traditional game companies towards blockchain games. Major game studios have shifted from experimentation to Sexual action turns to strategic development.

Ubisoft released Champions Tactics: Grimoria Chronicles on Oasys Layer 2 HOME Verse in October. This tactical RPG implements a series of NFT-based features while maintaining traditional game elements.

< p dir="ltr" style="text-align: left;">Square Enix strengthens the development of its blockchain sector through strategic investments and cooperation in addition to investing in game platforms Elixir Games and HyperPlay. In addition, the company also announced that it will bring its Symbiogenesis game to HyperPlay

Sony Group's participation marks a major push into blockchain gaming. , both through investment and infrastructure development, while supporting double jump.tokyo Inc.’s $10 million Series D round, Sony also announced the launch of Soneium, a platform designed to bring Web3 innovation to consumption in gaming and entertainment. Layer 2 connected to the application Web.

AI integrated into game development

As artificial intelligence revolutionizes various industries in 2024, the Web3 gaming sector becomes an important beneficiary of AI innovation. , opening up new opportunities for game development and player experience

AI has revolutionized in-game interaction and content generation that game studios are taking advantage of. AI Create more complex non-player characters (NPCs) that adapt to player behavior and generate personalized quests based on individual gaming history and preferences. This personalization enhances player engagement by making the gaming experience more relevant and personal. p>

In terms of development, AI has significantly simplified the creative process. Developers are taking advantage of AI. Tools automatically generate game environments and assets, significantly reducing production time and costs. This gives small teams the opportunity to create high-quality games that can compete with large studios.

AI also enhances the operational aspects of Web3 games. The technology is used to automate the game testing process and monitor on-chain transactions to guard against potential fraud or cheating, which is especially important in games with complex economic systems . Additionally, AI algorithms are helping to optimize game economies and generation.Coin model, solving one of the major challenges in Web3 game design.

Investment Landscape Annual Funding Event Overview

Web3 Games raised $910 million in 2024 across 220 funding events. While the amount of financing is down 7.3% from 2023 and significantly lower than the 2021-2022 boom ($3.2 billion and $2.7 billion respectively), the number of financing events is up 48.7% from 2023, indicating continued investor interest despite The size of a single transaction decreases.

This year there is a clear trend towards early-stage investment, 76 early-stage deals (34.6% of total events) compared with just 20 Series A or later rounds (9.1%). This trend suggests that while new projects continue to attract initial funding, many projects in the 2021-2022 boom are facing challenges in securing follow-on financing.

Animoca Brands maintains leadership among investors, completes 38 investments, an increase of 192.3% compared to 2023, and participated in 17.3% of all financing events in 2024. Spartan Group and Big Brain Holdings followed with 22 and 15 investments respectively, and the top ten investors completed a total of 152 investments.

Major Financing Events

Seven projects raised more than $20 million in single events in 2024. Azra Games led the way with $42.7 million in Series A funding and is focused on bringing console-level gaming experiences to mobile platforms.

From the perspective of cumulative financing, Monkey Tilt has passed two rounds of financing Raising $51 million, they are a platform for a "game-entertainment-gambling" hybrid model. Gunzilla Games from companies including VanEck, Coinbase Ventures, Delphi Ventures, and Avalanche's BFour rounds of funding were secured from well-known investors including lizzard Fund, demonstrating strong investor confidence.

Strategic Investment Trends

As the industry matures from the frenzy of 2021-2022, the focus has shifted to fewer but higher quality projects , investors have become more selective in their approach.

Financing is increasingly targeting game infrastructure and development tools, not just the games themselves. Notable examples include NPC Labs’ $18 million seed round for building Web3 games on Base, and Alliance Games’ $5 million Series A for AI-driven decentralized infrastructure. The trend reflects growing investor interest in underlying technology capable of supporting multiple games and platforms.

Platform and multi-chain development have attracted a lot of attention, especially projects to build a cross-chain gaming ecosystem. Seeds Labs raised $12 million for Bladerite, its flagship product on Solana, while B3 launched Open Gaming Layer, demonstrating investor interest in expanding cross-chain gaming capabilities.

In addition, new game categories will gain significant investor attention in 2024, especially Telegram-based games and gambling game projects, despite facing Regulatory challenges.

Industry evolution and future prospects

The Web3 game industry has experienced significant evolution in game models in 2024. The "play-to-earn" model that dominated the previous cycle gave way to a more sustainable approach. Telegram-based "tap-to-earn" games demonstrate unprecedented user acquisition capabilities, while Pirate Nation and Pixels' "play-to-airdrop" strategies provide new user acquisition methods. At the same time, mature projects are turning to a "play-and-earn" model that puts gameplay over financial incentives.

However, the field still facesOngoing challenges. Technical barriers remain significant, especially in achieving seamless blockchain integration without compromising the gaming experience. Regulatory uncertainty, particularly around gambling features and token classification, continues to impact development decisions.

The most critical thing is that maintaining on-chain participation has become a fundamental issue. This is particularly evident in the performance of Telegram games: Hamster Kombat’s monthly active users dropped from more than 100 million in September to 22.9 million in mid-December, with only 0.0004% of users participating in on-chain gaming activities. While other Telegram games show higher conversion rates, most are still below 1%. It’s worth noting that these metrics specifically reflect on-chain gaming activity, as the core gameplay of most Telegram games remains off-chain and users may be more active in other sectors such as Meme coins or DeFi. This highlights the ongoing challenge of converting platform users into active blockchain gamers.

2025 Outlook: Reinventing Relevance

When Web3 Games Seek As it reasserts its place in the crypto landscape, several key trends emerge as potential catalysts for transformation:

Social platform integration stands in the way of on the most promising path toward mainstream relevance. The astonishing success of the Telegram game demonstrates the power of meeting users where they are, and platforms like Line and TikTok are poised to take off. This approach may ultimately solve the user acquisition challenges in this space, by leveraging existing social networks rather than building communities from scratch.

AI integration will evolve from a marketing feature to a fundamental driver of innovation. In addition to enhancing game development and NPC interaction, AI may solve the field's core challenges in economic design and user retention. These are areas where Web3 games have traditionally struggled to compete with traditional gaming experiences.

Achieving sustainable growth through consolidation may ultimately determine the field's relevance. Success may not come from competing with traditional gaming or other crypto sectors, but integrating seamlessly with them. This means focusing on how blockchain can enhance rather than define gaming experiences, developing more complex token economics, and prioritizing user experience over crypto-native features.

To sum up, the role of Web3 games in the crypto ecosystem may not be about dominance, but about integration. By cleverly connecting traditional games, social platforms and blockchain technology, Web3 games are expected to create True innovative value. This evolution will not only help the industry break through the current limitations of "another crypto vertical", but may also become a key force in reshaping the future of the game industry.

This report is a collaboration between Footprint Analytics and Annual report produced in association with CoinMarketCap Research