Global Blockchain Game Popularity Fades... Domestic Companies Entering Market Feel Uneasy

Transaction Volume Declines Since November Last Year
Money-Making Game Gains Buzz
But Focused Only on Item Exchange, Faces Neglect

[Asia Economy Reporter Seungjin Lee] While domestic game companies are rushing to enter the market for "play-to-earn (P2E)" games utilizing blockchain and NFT (non-fungible tokens), the popularity of blockchain-based games is actually fading. This is attributed to most games being simple and the recent sharp decline in cryptocurrency prices.

According to DappRadar, a virtual asset market analysis firm, the transaction volume within blockchain games has been steadily decreasing since November last year. The average daily transaction volume dropped from $160 million in November to $104 million in December. In January, the average daily transaction volume fell to $89 million, nearly half of November's figure, and plummeted further to $66 million in February.

Blockchain games gained popularity as so-called "play-to-earn" (P2E) games. There was great expectation that players could earn money by exchanging items obtained in the game directly for cryptocurrencies or by turning items into NFTs and then exchanging them for cryptocurrencies.

However, most blockchain games have focused more on the NFT exchange of in-game items rather than on entertainment value, leading to user neglect. Except for some top-ranking games, the number of active users has rapidly decreased every month. The daily active users, which reached 1.2 million in November last year, dropped to 1.1 million this month.

The fluctuating value of cryptocurrencies is also cited as a reason for the decline in popularity of blockchain games. Ethereum, which is widely used as cryptocurrency in blockchain games, plunged from $4,750 on December 1 last year to $2,580 on the 22nd of this month. As cryptocurrency prices fell, the transaction volume within blockchain games also sharply decreased to less than half.

Domestic game companies are unable to hide their uneasy expressions. Wemade plans to service 100 games on its blockchain platform "Wemix" within the year, Netmarble acquired Bonotech, a blockchain app wallet service provider, and Com2uS is fostering a blockchain game platform through its game distribution platform "Hive." Since blockchain games are classified as illegal domestically, companies are targeting overseas markets, but the global popularity of blockchain games is rapidly cooling down.

An industry insider explained, "The blockchain game market is in its early formation stage, so it seems too early to evaluate the market. Most of the games released so far have lacked completeness, but high-quality games to be released by domestic game companies in the future could lead the blockchain game market."