The previous cycle marked the most speculative era in blockchain gaming history. Axie Infinity transformed what CryptoKitties and similar early iterations had conceptualized in the years prior. After Axie, the market diverged into two distinct paths:
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Web2.5 Games: Projects explicitly attempting to “onboard the masses” with light crypto integrations
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GameFi: A new category where speculation itself became the product
This second category is characterized by simple game loops that create an environment for participants to compete for advantages in high-risk environments. Some argue that the trustlessness of transparent smart contracts enables users to take on significantly higher risk profiles than traditional speculation platforms. Others may say that’s too idealistic and instead argue for essentially bottomless spending possibilities (compared to conventional gaming). A lot of idle capital is ready to gamble at all times in crypto. Regardless of the school of thought one subscribes to, we undoubtedly had quite a few moments of mania last cycle’s notable examples included DeFi Kingdoms (peak $1.3B market cap), Wolf Game (peak ~$18M daily volume), and Raid Party (raised approximately $60M during mint before the team slowly abandoned the project).
The GameFi Thesis
In our year-ahead podcast, we chose two distinct game types positioned for success in the remaining cycle, particularly in light of the broader crypto market’s fatigue from the onslaught of pre-product, pre-PMF tokens with increasingly high fully diluted valuations (FDVs).
The fundamental rationale: retail buyers who typically drive alt-coin markets
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