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BLOCKCHAIN GAMING – NEXT BILLION-DOLLAR TREND?
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0:00 Lounge Music
6:00 Intro
11:35 Gaming Industry
17:43 Global Gaming Market Overview
22:14 Market Overview – Players
26:12 Market Overview – Regions
28:28 Market Overview – Platforms
31:31 Blockchain Gaming – Features
38:39 Blockchain Gaming – Business Models
44:31 Blockchain Gaming – Market Overview
45:57 Challenges – Onboard Challenges
49:17 Challenges – Technology
54:01 Challenges – Business Models
56:35 Conclusion
1:08:57 Wrap up
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E [Applause] Ch W woo A Down A La [Applause] a W Oh Oh welcome back welcome back to the financially fit show where I show you how to be financially free be intelligent and be thankful and grateful in life in general hopefully everybody’s doing well out there pretty interesting week looks like Bitcoin is dimin across the $50,000 Mark
We’ll see how that goes and in the meantime I’m pretty sure and if not you haven’t really played this well your portfolio should be looking you know really better really good for now um enjoy the white while it lasts because you know where we stand from that uh
Perspective anyways uh today you know we’ve gotten a lot of requests on the gaming for a long time right A lot of people send me tokens about gaming uh you know to tokens that you know from Mod gaming and there are a lot of stuff that we’ll talk about today in terms of
Different tokens and different cryptocurrencies that are the gaming Zone and stuff like that these were you know really peaking in 2021 um but then they’ve been in a downward spil right from there and it’s like okay is there really anything in blockchain gaming um the you know the
Entire gaming universe and the industry around gaming is is really booming and over the next 5 years will probably have one of its most significant growth years um and this is where an interesting you know explanation or in an interesting uh an interesting thought that occurs here is like with the integration of
Blockchain and the kind of really valuable infrastructure that something like a blockchain can provide for gaming is there a marriage here right is there blockchain gaming going to be you know is is that a phenomenon is that something that will continue for a while is that something it’s a fat that will
Go away or is it something that will grow um in the coming years and this is what we do right we try to as investors we try to understand what’s where the pck is going we know not where it’s been um and we try to understand where the
Next billion doll trend is probably going to emerge so you want to go in get in ahead and try to buy some stuff so when it gets to the billion dollar Mark you make money and this is what we’re going to be talking about today right so we’ll talk about blockchain gaming so
It’s a little different from our regular macroeconomic discussion like I think we we discussed that most of the time but given the interest from the community on some of the tokens that you keep asking me to review right and they fall into gaming Zone and given that the centai
Industry has always fascinated me we’ve been working hard and giving you a very holistic end to end a very thorough research based data based research right on uh what exactly blockchain gaming is all about is this really the next B billion dollar Trend and is blockchain getting ready to revolutionalize gaming
In this industry so let’s talk about that it’s going to be a thorough analysis end to end what I can guarantee you is like after today you will know exactly what’s going to happen um now again it’s not a prediction but you’ll know exactly from the analysis where
This is going you will know what exactly this industry is you’ll probably not have to watch any other video on blockchain gaming or gaming per se like after this so that’s basically what uh you know we’ll guarante we’ll go very deep into this so we’ll have a very deep
Session around blockchain gaming so that’s where our lenses of investors right imagine you are an investor um and somebody’s pitching you a company uh to invest and as a VC fun funer right or or venture capitalist investor you’re listening to the session to make up your mind right so wear those lenses because
That lens is going to help you understand where this industry is going so be critical is what I’m saying right of the data of everything but at the same time try to understand the upside as well and together make your point of view and we’ll help you do that today
Okay so let’s get started you know as you know the expressed you know the opinion expressed here are for general information purposes only and I’m not intending ever to provide you with any Financial advice you should always do your own U you know analysis you should always make up your
Own mind you should always talk to your own certified financial adviser which I’m not uh and always do your own research before investing this is a free Channel we call it as a people’s Channel we don’t take a single dime from anybody that’s why it’s free education all right
Let’s get started okay gaming lot of money put into the gaming industry already this gaming industry is supposed to is actually not supposed to but it’s positioned to really grow and Boom by in the next four or five years and with blockchain and all the unique values that blockchain offers for something
Like online gaming is there a healthy marriage that we look at here especially with all the applications that have already been built what are the problems with this technology today and how that problems are being solved if at all and what’s the future of this industry that’s what’s I’m I’m going to cover
Today so in that we’ll talk about it an overview always like game industry what it is what the big players and stuff like that we’ll give you a quick overview of the market review of the gaming industry right around what how much billion dollar it is who are the
Big players what kind of games people are playing blah blah blah so we’ll go into the details of that after that we’ll talk about the blockchain gaming like what’s the phenomenon wh why blockchain gaming what are the some advantages that this industry offers we’ll talk about some challenges that we
See in the blockchain gaming industry in the end will conclude as to where we see this industry going so like I said exciting session sit back relax enjoy okay let’s get started gaming industry right so if you look at it and I’m sure you’ve heard about this right and I was
Telling this in my intro the gaming industry has actually witnessed a significant growth and transformation over the past decade expanding from consoles to PCS to Encompass every imaginable platform so I don’t know if some of you are Gamers there I am a gamer myself and you know I’ve been
Playing a lot of these console games ever since we were on PS2 uh you know many years ago right and over the last decade the technology has advanced so much um and uh you know the graphics and everything like everything around the infrastructure and the technology has
Advanced so much that now you can actually play a game which is quite realistic um you know and K realistic experience and you get really hooked on to a lot of these experiences right and that’s because uh you know the gaming industry has transformed from a technology standpoint from a
Storytelling Point standpoint and has seen increased significant increase in growth because it attracts so many customers and users now mobile gaming in particular has democratized access to gaming um thanks to the evolution of smartphones making gaming more accessible to the masses I’m sure like me many of you actually play a lot of
The games on mobile devices mobile phones there are many many big companies who make some really really good interesting games for mobile devices only and are making billions of dollars just through inapp purchases that you do within a particular game and that’s a huge industry right mobile apps and mo
Um gaming apps within a mobile device and within any app store are the top sellers um off of the store right and then that’s why they are the top sellers the games are generally given to you for free but a lot of inapp purchases coins gold coins or whatever that you know
That you have that you can buy within the game uh yields a lot of interest right and and continued interest and continued engagement from the user so they have really democratized across the gaming uh because of the smartphones Evolution and the rising development cost necessitate larger audiences for games to achieve
Profitability because there’s just so much invested in games right like a particular game a console game for example takes like a huge company ears to build so we’re talking about thousands and thousands of people working constantly for over a period of like 12 to 18 to 24 months to develop
Like a single game and the the and and because because the technology is so vast and we want the the story lines are so real we want to make sure that the games are really realistic and engaging so the the cost of the development is really really high so it’s an extremely
Capital intensive business and hence you know uh larger audiences are needed for scale for a lot of these companies to survive make giving you the same quality and then live service we have live gaming you can game with friends and stuff like that in live mode in-game monetization models have become
Prevalent unlocking new revenue streams for game developers um however if if you when we looked at the entire industry in terms of like the talent and stuff like that there’s always you know what we realize is there’s a shortage of skilled workers here in this industry and the
Reason for that is you know there there’s only so much of skilled workers that are available I’m talking about really high-end programmers and they are spread too thin across too many Technologies now a lot of the stuff is going into Ai and there is an intersection of AI and gaming as well
Which we’ll talk about later um and there is an intersection of blockchain and gaming and stuff like that so there’s definitely shortage of skilled workers in this industry because you know the world is gifted with a lot of developers but not really lot of really good developers that are needed uh for
Something like gaming um and this is why right blockchain gaming represents a new frontier in the gaming industry it’s only it’s only been around for like two years or so and it’s it’s aiming now how far it has been successful and what’s the future we’ll talk about in a bit but
It’s aiming to revolutionalize how games are built distributed and monetized because blockchain is distributed Ledger right so you have developers that are more distributed across the board that are not really working for like one profit company um are all coming together from different parts of the
World and trying to build in a more democratic way uh a gaming experience right and this is where blockchain gaming becomes really interesting because it’s a high-intensive High Capital business right U and when you democratize that by getting it on the blockchain and getting people across the
Globe develop it’s you know for some gain of course but develop across the board different features of a particular game has the potential to revize how games are built distributed and monetized right and leveraging decentralized Ledger Technologies like I was talking about blockchain gaming offers players transparency true ownership of in-game assets
Decentralization of gaming environment right it off off transparency because it’s all on the blockchain so you see the code you see everything what’s going on it gives you true ownership because if you buy nfds or stuff like that you can actually save it on your wallet so
It’s like you’re truly owning that you can actually use those assets across different games if there is a network of games that allows that it’s a decentralization of the gaming environment and that’s why you know this is such an interesting area for me also that we are looking into from a
Blockchain gaming perspective right it also enables like new economies where players can freely trade it into inter operate items between compatible games like I was telling you like fostering a more Dynamic and interconnected gaming uh ecosystem so you know you can exchange this you can give it you know
Because it’s always wallet to Wallet transaction because you really own the assets it’s not restricted to just you know the platform you can actually or like one game you know if there is a gaming interconnected game gaming ecosystem then you can actually exchange sell right some of these assets to other
Players so really creates a community across this especially the decentralized you know F function and the feature of of a blockchain um so that’s a little bit of like gaming industry and how this actually connects over to to blockchain uh we’ll get more detail into the global
Gaming industry and let’s take a look at the market what are we talking about here right so when you look at the market across the board now currently in 2023 uh the market is almost about $188 billions dollar like the global gaming Market size in terms of revenues is about
$188 billion um you know and this was like this analysis was done in December so the time it was right very close to reaching but right now it’s about $188 billion of market cap now when you look at the cagr which is the compound annual growth rate right if you look at year-
On-ear compound annual growth rate um what you will find is it is estimated that in the next 3 years to 2026 this revenue is going to grow up by 4. 2% it’s going to compound every year on a 4.2% uh you know uh you know compound rate and it will go to
22 almost 212 billion dollars in spite of a lot of stuff that is happening across the board with elections with everything rather the economic downtown stuff like that this industry is expected to continue to grow and outgrow itself right even beyond what happened in 2021 so as we
Get into 2026 compan annual rate growth is about 4. 2% that’s the very conservative estimated uh uh you know growth rate now this indicates a sustained growth rate uh and potential for further expansion in the many coming years and that’s why many major companies like Microsoft and others are
Continuing to invest in this area because this is a big market up for grabs right now the market size of the blockchain gaming let’s just talk about the blockchain gaming sector only the markets of the blockchain G gaming sector exceeded almost $3 billion in 2023 right and these are some of the big
Gaming you know applications and companies or you know um folks who’ve actually made this possible and if you look at the overall globing you know web 3 Studios right like all the blockchain gaming it’s about 15 to 20% of the overall globing Global gaming Market
Size now you may say that you know this was really really big in 2021 and now it doesn’t exist anymore because a lot of the games that Tred to build this model and failed in 2022 2023 um you would actually feel like okay this is uh not a big chunk but it
Is right but you look at the numbers almost 15 to 20% of the global gaming Market size is now with the blockchain gaming industry which is fascinating right and projections from a report by web3 Studios that we were researching um polygon labs and the other blockchain game Alliance anticipate blockchain
Gaming to grow between 65 to 90 billion dollar by 2030 so it’s at 3 billion now and the estimat is to go 20 to 30X from there by 2030 now it’s an estimate and that’s what we will talk about right as to how you know this is even possible what are
The challenges what’s the work being done around it or stuff like that so that is the opportunity right so as an investor when I’m looking at all this this is why we try to get ahead and try to understand where the puck is going because then you can make sound
Investments on you know um on on assets that are are like in the blockchains that are actually trying to solve the problem right and kind of get in early so you know you come out really positive in the next few years now again some of these are going to be very risky
Investments so I’m not really advising you to go in or to go all in or I’m not advising you advising you to go in at all or not go in or anything all I’m trying to show you is the potential of where this could be headed if things are
Developed in the right in the right lens through the right frame of mind okay now the while the blockchain gaming is expected to represent a very small portion of the global gaming Market by 2030 it could experience a significant faster growth rate right because of the adoption as blockchain becomes more and
More viral more like in adopted across the board uh and and you know the key drivers for the growth of blockchain gaming include increased investment and funding in blockchain games adoption of nfts and the development of innovative business models and we’ll cover all that in the blockchain gaming around how the
Investments have increased here what is the funding today what how how the adoption of nfts is going to help our harm and the development of innovative business models right so so this is why um this is the this is the reason why we doing this show so that you can connect
All the Doss and make up your mind on this is this an industry that you like to get into or not okay let’s just talk about the players here today in the in the market right across the board so the total number of video game players the folks who actually play the games
Worldwide reached almost 3.38 billion players in 2023 like reflecting an year onye increase of 6 .3% right so 6.3% so you know if the overall population of this planet is about 8 billion 3.38 billion of them actually play these games now not all of them are playing it on the blockchain of
Course right uh very very small percentage of them actually played on the blockchain but overall if you look at the global gaming number of players and the users it’s fascinatingly more and it’s continuing to grow year on year at 6.3% with such a huge base that
Itself is a very very very very big big number to look at mobile gaming of course is responsible for the majority of new players that are added and this is because of the smartphone technology that’s so evidently available for everybody smartphones have actually brought the cost of mobile using mobile
Devices lower and has also given access to a lot of these users who are on boing to playing these games um you know um on their mobile devices gaming has you know again become an ingrained in our mainstream culture across various generations and of course the younger group show higher engagement levels they
Are the ones who are actually engaged the most which again is a very positive thing or it could be a negative thing the way you look at it right I mean if they are like vient games and stuff like that of course these are responsible for
I I don’t deny that you know gaming can also harm if if not monitored and not played well or whatever right or not created responsibly but a younger generation adopting to any industry um is actually a promise that that industry is going to survive for longer because
Most of the players are still young younger right and they’re going to continue to play as they get into their 30s and 40s and 50s because they’re hooked they hooked to it already so it’s not necessarily a bad thing when you look at it from a business standpoint
And I think that’s a good thing if something is attracting interest from more younger Generations it’s going to be more sustained in the long term and established players um you know there there are many of them they take out videos on YouTube and they let you
Follow their you know how they play the game and and stuff like that all they do is they project their games I don’t know if you’ve seen some of these streams they do live streams they record videos all they do is just they show their gameplay and they have like these
Millions of views on the YouTube video because people are trying to really solve and play the games uh like they do so they try to learn from them right so there are a lot of established players and they remain involved as new demographics enter the gaming sphere contributing to the ongoing expansion of
The player bills like I said one of the ways to do it is by taking out some of the YouTube videos and stuff like that and going from there um and you know major transmedia adaptations of iconic games franchises such as the Super Mario Bros movie if you remember this was
Released in 2023 a lot of the other things around this is actually helping validate gaming as a mainstream Pastime you know a lot of movies are being made on some of the games that you know iconic characters from the games and stuff like that and that give this gives
A lot of validity you know to U you know to the games that are being played and also opens these games and these characters to a wide variety of audiences who may have heard but haven’t played but looking at the movie may get interested and get into gaming so uh
This is going to continue to grow I don’t expect this to stop uh the number of users coming into this uh into this Arena right um now the compound growth rate the cagr right compound annual growth rate of 4.3% is what is recorded what it seems that we is estimated that
Each year on year this base of a huge base of 3.79 a huge base of 3 38 billion is going to go into 3.79 billion because there’s going to be a compound annual growth rate of 4.3% through 2026 now it’s going to be much more when you look
At 2030 but my analysis is just over the next 3 to four years how it’s going to look like okay in terms of regions right we are living in a global economy Global World so in terms of regions uh Asia Pacific regions hold the largest share of global video games players which is
Not fascinating to me that Asia Pacific region also holds the larger number of younger generation people right so this is why a lot of the younger generation folks are actually based out of Asia Pacific region so I’m not necessarily surprised that they are the ones who are actually involved in video game gaming
More than any other region almost 46% of the entire you know um of the of the entire gaming industry almost 46 plus% plus actually lives in and they are you know lives in Asia Pacific and they are growing 1.2% year on year closely followed by North America right 51.6
Billion in Revenue Asia Pacific was 85.8 billion in Revenue North America 51.6 billion but growing much faster year on year 3.8% um right and then you have Europe and you know you have Latin America and followed by Middle East and stuff like that so it’s a it’s a booming industry
Um it’s definitely with you know more younger generation that get of done but not just that right I mean they continue and a lot of gen you know people who are middleaged and stuff like that are also getting into into this because it’s it’s entertaining I’m a gamer myself so I
Know it’s it’s quite entertaining and and a really good experience if you play the right games you know the dominance extends to blockchain gaming you know with Asia Pacific region expected to dominate The Market in the coming years because it’s all about segmentation of the customer the customer segmentation
Is more of younger generation younger age folks right so that’s why the dominance extends to blockchain gaming where blockchain gaming as that gets adapted and scaled a lot of the Asia Pacific users apparently um is estimated to kind of join that cult in a way you know the key vendors in the blockchain
Gaming sector such as Skai Mavis the creator of axi infinity you probably have heard of that right um they have a significant presence in the Asia Pacific region also and that’s probably one of the reasons why a lot of uh you know these Gamers and in the culture of
Gaming and stuff like that is a more prevalent in Asia Pacific as compared to others let’s just take a look at the platform right like if you look at the like like the platforms no surprises here almost 50% of gaming revenues come from mobile platforms right indicating their dominant position in the gaming
Industry right almost you know 49 plus almost it was you know this was rounded up it was like 49.8% or something so overall uh 50% just rounding off it’s from mobile uh mobile games 92.6 billion dollars and growing almost a percent year on year U right and console games
Are the second largest of 56.1 billion but growing 7.4% year on year uh right followed by like the downloaded boxed PC games um I don’t know why some people even play that uh I’ve never found that to be interesting to be honest like this is my personal choice but I know some
People do that PC games and browser PC games also um you know the browser PC games were kind of coming up uh if you look at it I don’t know if you followed this industry but we did uh four four years ago I with zoom the browser PC
Games was going crazy it was there was a lot of growth but then the user experience didn’t sustain on the browser PC games and that’s why a lot of companies who were trying to get in there stepped back because they realized that the user engagement isn’t that
Right I think people you look for convenience mobile games or console games kind of give give you that console games are for real gaming experience so I use console games for playing like real real games like Assassin’s Creed and others um mobile games are more for
For passing the time um you know you sitting in a classroom you board with a lecture you take out your mobile device your mobile phone you probably play a game um or or something like that right you know um so I would expect I expect
These two to continue to grow more uh I do know there are a lot of people who are you know very specific about PC games and they buy you know PCS with you know higher RAM and stuff like that just to play those games and very AC quied
Taste I’ve never I’ve never understood why but there are certain people almost 20% of the game to do that and brows of PC games I’m I’m not sure how long they’ll survive but they still have about a percent of of Market uh you know um right now okay mobile developers and
Publisher encounters challenges related to monetization user acquisition we’ll talk about that in a bit largely due to policies enforced by Major app stores and stuff like that it’s a pretty tough uh you know Marketplace uh for some of these games and they are a lot of challenges for some of the smaller
Mobile developers right as they as the maneuver and try to work through some of these app stores big big big app stores in the mobile the mobile platform is anticipated to retain stat as as the largest component of the total gaming market right this is what we’ve realized
Uh from our research uh in the forceable future but definitely underscores the significant of the industry landscape if you know as they continue to retain if not grow their scope the you know as the mobile industry we saw earlier goes to close closer to 300 billion plus Mark
You know it would be interesting to see which other sectors of the business actually pick up pick up slack okay so hopefully by now right you have kind of you have a good understanding of what the gaming industry is like what’s the market size like where the growth is
Coming from where the growth has come from over the last several years what are the different regions that are involved and and stuff like that so that gives you like a good understanding and background which I think is essential as an investor as you get into making up
Your mind whether you want to invest here or not but let’s just talk about the main thing right now that you understand the gaming industry you know right that it’s a booming industry it’s going to it’s going to be here it’s going to survive it’s going to grow you
Know 4.3% CGR across over the next few years now let’s just talk about blockchain gaming now blockchain gaming is a fascinating concept because blockchain right the creation of blockchain has multi-purpose applications I believe across the board nothing fully realized yet it’s unfortunate because this industry is
Ridden with people who like to scam for folks and scamsters who just like to get their token you know value higher and this industry unfortunately is ridden with a lot of scamsters who would dump on people and pull you know do Ruck pulls and and stuff like that uh unlike
Others because it’s in the financial industry unlike others but blockchain gaming in general has a lot of potential if applied really well we’ll talk about that in challenges but let’s just talk about black G blockchain gaming but let’s just talk about features why am I so excited about blockchain gaming
Because it does give us features that are needed right because if you look at it the blockchain games they offer unique features that distinguish them from any traditional video games you know benefiting both Gamers and developers right because firstly they’re hosted on decentralized networks U they are maintained by global nodes which is
Why they’re not you know necessarily dependent on like you know with one company or like one cloud service or stuff like that so very the very uh self-reliant from that perspective they created on decentralized networks they operate independently uh of any company owned service or stuff like that right
Making them resistant to single points of failure it’s very unique as you know when you look at the gaming industry what blockchain gaming actually has to offer right blockchain technology also enables digital scarcity right because a lot of these stuff can be built on very digitally scarce assets like Bitcoin
Like I would say in the long term something like kadena as well that’s what my belief is right I could be wrong but that’s that’s what I think um is scarcity anything that is limited right ensuring unique and valuable in-game assets through transparent transactions on public blockchains right like Kad
Like so this is where I just feel like when you have a gaming infrastructure created uh on on a really digitally scarce Network and asset everything that happens on top of it right uh you know in terms of transaction stuff like that is recorded in a public lger but more
Importantly the assets that you buy using that token is is really valuable and hence you can use it for different transactions they valuable in-game assets that you can sell trade later on and stuff like that and they’re all transparent because everything is recorded on public blockchain so it
Brings with it certain kind of digital scarcity and certain kind of you know security for having those transactions right true digital ownership is realized only through token tokenization of gameplay and smart contracts right because a lot of the times when you actually allow players to buy in in-game
Assets you can store those assets in your cold wallets so this is true ownership nobody can have that asset but you right like in this would be characters resources stuff right I mean if you’re playing like a video game could be a sword it could be something
It could be the clothing style or whatever this could be very unique created through an nft given the rights to you and then you actually store that asset on a cold wallet right as a form of a token um that can only happen right through a blockchain gaming now I know
There’s a lot of stuff that needs to be built in for that to really function but this kind of technology is only offered on blockchain and that’s why I feel from a features perspective blockchain does provide a lot of innovative um you know uh solutions to the problems that could
Be quite attracting uh right for for blockchain for G gaming developers and and players you know because blockchain gaming also introduces Innovative in-game economies where players are rewarded for their gaming skills and can earn digital assets for in-game achievements creating a more resilient ecosystem now I understand and agree
That a couple of game developers tried and failed in this a Infinity for example right um they haven’t been able to sustain that growth and we’ll talk about some of the challenges as to why that is the case um but it’s still a really good idea in my opinion it’s
Still a really good idea where you play a game on a blockchain uh you know you create your own in-game economy that helps and rewards the players based on their gaming skills and they can earn digital assets for in-game achievements right as they go through different levels and stages and that’s that brings
In some money right that actually helps in creating more resilient economy now this could be abused and in the case of axi infinity and others we’ve seen where like you know this was severely abused and players were asked to play living in really poor countries and they were off
With some money and they couldn’t continue to play Beyond 8 n hours so definitely this has some side effects and this hasn’t been implemented like it should have been an economy requires multiple games to come in uh right and multiple users to come in which I think unfortunately blockchain lacks because
Like I said this industry is ridden with scamsters who who just rock do rock pools and stuff like that because it’s it’s a more financial uh kind of industry but if some of that is sorted and some of the technology s like I said we’ll talk about that in challenges this
Can be a good future for the games right because this feature is only offered uh through blockchain gaming it’s not offered in any other gaming right any other gaming environment and last but not the least interoperability is a prominent feature of blockchain gaming right this is faciliated by cross chain
Communication enabling players to move in-game assets and Status between games and networks through crypto wallets thereby expanding the gaming ecosystem and connecting more players right interoperability will always be there I’ve always said this the world will not be living on just one network there will always be multiple networks that you
Will interact with and given that blockchain through blockchain it’s really easy to go through interoperability right and go through different um different uh networks uh for different purposes right you could actually move your in-game assets into different networks right and and and you’ve seen that happen across across different blockchains already so
Interoperability is also a feature that is um you know prominent and can only happen on a blockchain okay let’s just talk about business models right and as we were thinking about this there are significant business models and really good models that have been you know established but not necessarily
Sustained not done in the right way or could be done in the right way when you talk about blockchain gaming and why this is really really sign significant and makes the blockchain gaming stand out as the rest of the gaming features right if you look at it most of the
Games can be offered free to play players access the game for free with the option to purchase in-game items or currencies to enhance their gaming experience this is very typical to any gaming application that you get from a store right this is what you can do you
Can do that on the blockchain as well you could also go to pay to play right players pay an upfront fee to access the game you could go for subscription based model players pay a regular fee typically monthly or annually to access the game continuously right and they get
A reward every time you know they’re Crossing one level and stuff like that right so that is another model that has been established before I haven’t sustained but this is something that can be established if put it the right way advertisements is another way right like game games display in-game ads to
Monetize often offering additional in-game rewards for players who watch ads and stuff like that microtransactions is another way the economy could you know the business model could work here because players make small purchases within the game to unlock additional content or cosmetic features right like the color of the car
Or the dress or this or that right so they can do a lot of this microtransactions within the game to kind of get this so the different business models that have kind of been depl deployed some some of them successfully many of them unsuccessfully but they could actually be deployed in a
Similar manner as it’s been done across the gaming industry but it can be run effectively using the blockchain and the reason for that is the unique digital assets that are bought sold and traded on a blockchain representing say items like weapons equipment and characters and blockchain gaming right these are
Unique digital assets which can never be the case in any traditional gaming right the unique digital assets because it’s very hard to monitor who has it very hard to trade them and stuff like that this feature is only available and can only be available through a blockchain
And that’s that that’s what I think is is really a game Cher here right players can earn like cryptocurrency or even valuable in-game assets such as nfts if that has value by playing the game focusing on earning income through gaml right now again like I said axi infinity
And others they tried it they failed it because they couldn’t sustain the engagement levels of the user especially as crypto goes through bull or bare Cycles but if there is a market created around it if the games are interesting if there’s a market created this is something that can actually
Be beneficial for growing this industry right players also generate distinct digital assets within the blockchain gaming possessing tradable value in an open market allowing them to convert in-game assets to real world worth right so you know they they could actually say hey they so for example if they if
Somebody gets some side of a weapon for example in a game right I’m talking in a game and that gets unlocked when you go to like the 10th stage and somebody is really good with this gameplay and stuff like that unlocks it gets that right that’s a variable valuable asset now he
Could actually use that store that in his gold wallet uh you know through an NFD and then sell that in an open market for somebody who may be in a level two or level three to kind of get that benefit and get that asset so that that
This person can progress further in the level so I’m just giving you one example there could be a lot of others but the point I’m trying to make is the way this whole infrastructure is created for blockchain and the way the business models can and have worked in the past
Creates this unique differentiator for some of these players to actually get involved and play this game uh because there is a there is a there’s some sort of like a um you know there’s some sort of like incentive added for them to get to that particular level because then
They can use it and you can sell that asset and stuff like that in an open market right you could do it on an open C or something you know give the rights through an nft as ownership and then transfer that asset to that wallet so this person can actually use it so
There’s just a lot of lot of stuff that you can actually think of when you look at blockchain as a way for you know developing and and and playing games developers can integrate elements from both traditional blockchain games to capitalize on the advantages offered by each approach right in in-game tokens
Known as the soft currencies uh have been interviewed in the past right so they are introduced to address challenges associated with the token inflation these tokens cannot be traded externally but are used within the games economy um so for example a soft currency for the games like some sort of
Coins or stuff like that uh that they could use right and they and they’ve been introduced in the past to it was challenges associated with the token inflation because you cannot get more of that you get it only when you cross certain levels or stuff like that so this is where inflation remains
Constrained the value goes up but these are very these are soft currencies used to be only in the game you can’t really sell them outside so this way you can control that and and that’s actually a really good way of ensuring that in-game tokens are valuable and people play the
Game right you know nonf fungible tokens nfts um in the past have been Incorporated right into the games as purchasable uh in-game Cosmetics for players it’s not sustained it hasn’t been sustained because nfts have lost like 99% of their values now but these nfts actually represent a unique digital
Asset right that players can own and trade again like I said if it’s done in the right way and we’ll talk about that in the conclusion of how we feel developers can actually and and content makers can actually do the right way but nfts can be used here in terms of
Ownership rights for a lot of these assets that come about right um let’s just take a look at the market overview right from a blockchain gaming perspective right if you look at the blockchain gaming perspective data indicates that you know the p2e games have dominated the blockchain gaming
Market across the board right the play to earn model basically that’s what P2 means with significant trading volumes exceeding $17 million so this is where I was saying a lot of the stuff that I’ve talked about some of them have somehow kind of created this you know uh they’ve
Tried to deploy it not on the right way but some some of them have been successful in deploying that business model and that’s why the the the play to own games have dominated the blockchain uh gaming Market as comped to a lot of the others across the board um right and
If you look at Q3 of 2023 this was data we got from crypto.com research uh you know the the blockchain gaming sector recorded an average of 787 th000 unique active wallets engaged in Daily activities and that is pretty significant that was pretty significant back in Q3 2023 that’s the last data
That we could find but it’s pretty significant if you look at it right uh 787 th000 unique wallet active addresses which means that these are unique I mean mostly unique players not everybody will be onetoone mapping but most of them are unique players so the daily active users
Uh on the network for play to own gaming uh within the blockchain gaming is pretty significant seems like now you’ve seen the potential right that’s that was my point from blockchain gaming there’s a lot of potential a lot of business models a lot of other things that like that that you can incorporate
To get the audience engaged here uh because blockchain does offer very unique uh features that none of the other providers or game providers you know or game creators do offer but however there are a lot of challenges here right and this is where um you got
To take a step back and look at this holistically and understand what is the challenge and what are the things that we need to do to work on those challenges to move this industry forward so for example let’s just talk about some of the onboarding challenges right
This is some of the things that we found if you look at the onboarding challenges here onboarding and accessibility are the biggest challenges they are the primary blockers followed by constrain game play lack of understanding of blockchain gaming Concepts among participants because there is some learning for onboarding it’s not that
Easy it’s not just picking up you know the joystick of your console and playing a game onboarding onto a blockchain gaming infrastructure does require some level of technical Fitness you’ll need to understand how wallets work you need to understand how you can connect some of those wallets you need to understand
What are the different currencies soft currencies hard currencies that exist here you need to understand how to play the game how to deposit stuff in your wallet how to take it to coold wallet it does require a little bit of technical you know Nuance to be Comfort it does
Require a little bit of comfortness to technical Nuance because the onboarding has been so restrictive right because the games are extremely premature if you look at some of the you know Graphics of the games and stuff like that they’re not at all engaging so far and that is
Why right onboarding is such a hard thing because you have you know we haven’t really solved the onboarding problem for somebody who’s playing a console game to come completely onboard here and that’s why accessibility onboarding are the biggest drivers right now constrained gameplay and we’ll talk
About that in a bit in a you know we’ll talk about that in a bit but constrained gameplay right because the features aren’t necessarily there the graphics is unnecessarily up to the Mark it’s very constrained and very limited very restricted right and a lack of understanding of blockchain gaming
Concepts like amount participants that’s probably the reason why this requires a little bit of learning curve for somebody to switch and they can only switch if the games are absolutely great but that really needs to happen before people start to get into this just to earn a quick bu and that’s the problem
Here that’s one of the biggest challenges right like I said difficulty on winning new players and ensure accessibility are significant challenges faced by these platforms participants highlight constraint gameplay experiences as a barrier to adoption indicating a need for more engaging and immersive gaming experience we really need to focus on developing these games
Really really really well before you try to make a quick buck and try to like have all these nfts and stuff like that companies whove invested in this so far have been greedy for the shortterm and stupid in the long term because they’ve lost all sorts of credibility by going
In in all places at once without really creating a good and sustainable product in terms of the gaming experience right the other challenge right here is technology if you look at technology blockchain Network face scalability issues because they’re not really selecting the right platforms to build these games on unfortunately majority of
These games have been built using ethereum and that was one of the biggest mistakes anybody could do because what happened was as the gaming scale and the industry boomed in 2021 so did the high transaction volumes and hence because ethereum cannot scale in lay on layer
One and some of these games were don’t on Layer Two this impacted a lot of transaction fees this impacted a lot of trading fees this this impacted a lot of network congestion and the entire gaming experience went to docks people really didn’t select the right layer one and
That’s why it’s really really really important for a lot of these developers to look at what layer ones are out there in my opinion kadena for example is one of those layer ones that have had a zero down time ever since it’s launched it can scale infinitely right and if there
Are de blockchain gaming developers out there who are able to listen to this I would plead you to take a look at Cadena for example as one of the layer one blockchain and maybe there are others but k for example is what in my opinion is very scalable and I think building
Games on top of kadena and using that Network and building really really good engaging games is the way to go because your block you know you need to have scale scalability issues is going to be the number one thing because it requires games are so complex it requires a lot
Of data to be transferred and transitioned from one note to another it requires the network to scale at any given point in time right and this is why slow transaction times thanks to ethereum and others High transaction fees again thanks to ethereum and others poor user experience results from the
Inability to scale effectively which is a put off right people won’t play games if the transaction fees are so high if the transaction timelines are so high if it’s congested the network is congested so if you don’t have the sound and properly layer one you are doomed to
Fail and that’s why it’s really really important to develop your games select your layer one protocol the right one because you’re creating a game as an application on top of it it really needs to scale right game developers must balance onchain and offchain components in design choices to ensure cost
Effectiveness right onchain transactions are costly in terms of transaction fees and data storage and this has led developers to optimize data storage and processing between onchain and offchain solutions and this is where a lot of the stuff like Cadena right which require which uses chain web and other
Technologies to bring a lot of the offchain to onchain right a lot of transactions are dealt in multiple chains all parall linked together is one of the technologies that can actually scale and a lot of the games develop on top of these Technologies are doomed to
Succeed uh you know or are positioned to succeed they’re doomed to fail and position to succeed uh if they use a prop layer one which they haven’t and that’s why the gaming industry on the blockchain gaming have had many challenges right public blockchains store every transaction in piece of
Information publicly right so this also raised concerns about privacy and data protection of the customers right and and that is something that has always been uh one of the rais know issues with blockchain gaming now moving along in terms of Investments right where did blockchain games Investments go in 2022
So if you look at 2022 over a third of the blockchain gaming Investments were directed towards infrastructure Builders which is actually a good news right which is actually good I’m glad that people are focusing more on building the right infrastructure right followed by the game um you know quality of the game
And the meta and stuff like that because that is what it would take for a lot of these games to sustain over a long period of time to keep the users engaged over a long period of times right the Investments were made with the expectations of developing purpose built
Solutions to address the acute constraints faced by blockchain Gaming Technologies right infrastructure Builders are actually aiming to create specialized tools platforms and technologies that are tailored to the unique requirements of blockchain gaming most importantly scalability interoperability and security right scalability interoperability and security and this is why I’m a big Kina
Fan as you guys know and this is why one of the reasons why I’m a big Kar fan is because of this as well because Karina does offer scalability it offers a lot of inter relity with other you know blockchains and of course it’s a proof of work it’s extremely highly secure now
Play to earn for example uh games experienced significant growth in 2021 and this is a chart from axi infinti right active wallets just look at November of 2021 October 21 they peaked right over 700,000 active daily active users were on axis Infinity in terms of
Daily active users right U aw and a huge transaction volume but right and these games allow players to earn cryptocurrency or in-game assets by you know by participating in-game activities however just look at where they are today look at where they were when the screenshot was taken in October 2023
Despite their initial success the P2 model faces sustainable challenges and it failed miserably because axi Infinity developed on the wrong layer one axi infinti really didn’t create a great cons consumer gaming experience at the end of the day so it wasn’t engaging it was a fad they did not have the right
Business model right it resulted in a lot of abuse with PE for you know for people because a lot of folks in poor countries were employed to play like the game 8 10 15 18 hours U and there was a big you know s big research done on this
And stuff like that that was really really wrong by some of the players here so there was a lot of abuse and they didn’t do anything to kind of catch this so and and then you know the token the token escalated the the token was listed
The axi tokens right on the network uh you know it was listed separately as a token that people bought lost money on so it was a good business idea but extremely in my opinion implemented in the wrong way that’s why it didn’t sustain that is why it’s really really
Important to first focus on your quality of your user select the right platform to build this on select the quality ensure that the games that you’re creating are scalable games with a high quality that can engage people and sustain them over a long period of time not a fast like any other cryptocurrency
Or any other meem coin out there right and that’s one of the challenges of this industry that infrastructure needs to kind of keep up with the requirement of of the games um and they’re heavily relied on P3 models only right um and attracted all I would say wrong users um
And uh it was very hard for them to retain any sufficient resources to reward existing mons uh making their longetivity very very uncertain so it’s a great use case and a great study of how some somebody tried to do this but failed miserably and now hopefully
People can use that data point and kind of focus on building a more quality product that can help sustain this industry right now hopefully by now you’ve understood what the gaming industry is all about what is the potential you’ve understood in detail about blockchain gaming youve understood
You know what the issues and the challenges that industry had right let’s just take spend a few minutes on conclusion right what what does it all mean when you put all these pieces together as an investor what do we what do we mean by that so let’s kind of take
A look at what do we diagnose from a lot of this uh you know information that that we have right what it is clear is blockchain gaming is evolving in gaining users in investment right we’ve seen the you active users and stuff like that across the industry I’m not talking
About like one particular game and we’ve shown you some data that there has been a lot of Investments that have been made in this area especially around the infrastructure and stuff like that U you know so that is good to see that you know blockchain gaming is evolving it’s
Not there yet there definitely a lot of challenges but it’s evolving in its gaining trans you know traction the blockchain gaming industry which was valued at 4.6 billion in 2022 U is projected to exceed like this is based on the report if like again I would say big caveat that if everything
Goes right is supposed to exceed by $65 billion in market capitalization by 2027 provided they solve the underlying issue so there’s a lot of potential here right right the way to look at this metric is not by getting to certainty that that’s going to happen but more around the
Potential right and looks like the the Investments have been in the right line of infrast so I’m looking forward to a lot of these gaming projects launching and stuff like that especially as the bull market is coming together in 2025 not now this year it’s going to be very
Bearish like I’ve said but in 2025 and above and we’ll have to see how the gameing industry in in in in here does because there is potential for this to really scale big uh from a $65 billion market capitalization perspective that’s just a number but the the point here is it’s
Position it’s getting it’s it’s gaining uh it’s evolving it’s gaining traction its position to scale up gaming contributes significantly to the growth of crypto industry just like any other industry right representing nearly half of the total onchain activity in 2022 that’s where it was still higher right
And the onchain activity almost half of that was gaming so this is a sector that is here to stay despite industry down Trends in 2022 onchain game transactions reached 7.4 billion marking a 37% increase from the previous year right that’s what our research found which is a staggering 3,260 increase from 2020 so
Of course I mean leave alone 2020 that was a big sham 2021 was a big you know gassy year a lot of gas and stuff like that not necessarily any fluff lot of fluff but no no me but 37% increase year on year still from 2021 to going window to so seems
You know is significant from from that perspective right um blockchain you know from a monthly funds raise perspective right blockchain gaming competes fiercely to get all the dollars across web three sectors and you know and I think blockchain gaming probably is one of the closest application closest to the application
Dream in my opinion as compared to blockchain because it is fascinating the kind of features that a blockchain provides from a gaming standpoint is really fascinating as compared to others right but it competes fiercely sometimes gets something sometimes it doesn’t um but the gaming industry competes fiercely across all the other
Applications to get the funding needed and this is why not to all those people who Fund in these areas put your funds behind blockchain gaming ensuring that the infrastructure is created really well in the business model that can sustain right and that is going to be critical especially as we continue to
Kind of look through this so if you look at the chart game five is what you got to look at and you’ll see game five still gets like the least in terms of the Investments and it’s not necessarily a great thing the potential opportunity here is really really big so for me I
Would actually take off a lot of the stuff from defi you know which is and CI and social right and put it into gamey to be honest because at least or even nfy right put put it into gamey because I feel that to me is more potential industry that can actually create some
Really good use cases and applications for blockchain as a whole and for the community to rise right so that’s what I would do right gamey like I said ranks among the highest funded sectors following blockchain service centralized Finance C5 and D5 like all that I would actually Channel all that money into
Gamei because you know that is where I feel there is immense potential because the uni qualities that um blockchain has uh from a gaming standpoint is invaluable and probably game changer for the entire gaming industry right you know game has raised over 793 million year to date uh I’m talking about 2023
Comprising 9% of the total uh investment for the sector and by 2030 right games are anticipated to dominate the blockchain gaming Market constituting the largest vertical across the board right so if you look at blockchain gaming verticals and this is again estimated so take it with a grain of
Solve uh quality games is where majority of the money is going to live by liveing 38 billion uh according to one survey done you know blockchain gaming leverages revolutionary technology like I’ve said right it offers decentralization digital scarcity true ownership Innovative economies and interoperability you can never find all
These features in any of your traditional gaming system that’s why there is an immense opportunity here for blockchain to not mess this up and get this done right these features benefit Gamers and developers because they provide resistance to control they provide the ability to create valuable assets they provide true ownership like
I’ve said to these assets they provide multiple monetization methods to make money uh and they provide a really good way for the economy uh and you know for the economy to grow the gaming economy to grow uh by cross game asset transfer and interoperability these are very unique features that you
Can’t really find in my opinion in on any other platform on a traditional gaming perspective you know and in my opinion blockchain gaming does have the potential to shift the traditional gaming Paradigm by altering asset ownership and gain development distribution and monetization methods and decentralizing it all so it’s an
Immense potential opportunity hundreds of billions to be made here if the developers Focus or you know the on the right thing don’t just create a very bad experience game just to make a quick bar and just to have a seasonal of of a high game engagement and then just like axi
Infinti unintentionally I hope so did but focus more on the long term create a really good gaming experience make the onboarding experience Flawless make it extremely easy for customers to on board and move from their traditional platform to this and experiment here and you know create really high engaging games and
You’ll fine you know when you have any business you not you got to focus the first few years you focus on a user base or customer base the next few years you focus on Revenue if you want to build a long-term company you don’t focus on
Revenue on day one because then you make decisions that are not necessarily adequate for a long-term success of company look at all the big Tech compan companies that have been built over the many years right look at you know Google for example or look at Facebook for example right Facebook did was not
Monetizable they didn’t have ads or stuff like that for many years before they started to bring in Revenue right because they wanted to focus on creating a really good and a sound you know infrastructure for social networking right YouTube for example did not make money for many years right and then
Eventually was able to to crack the code of how to monetize it but became like the world’s second largest search engine right before like the whole Revenue thing started so there are big companies who make sound decisions to create a product get the users on sustain it
Through user funding but at some point Crack the Code of making money right that’s what we need we need a long-term company here who can look at some of these features build some really high experience high quality experience Gam teams using infrastructures that are scalable like Kaden like I always say
Build something that is of value stay in the ground right create good user experience and create a community and stuff like that Focus that on the first few years and then Revenue will follow there is no doubt about it Revenue will follow we need a company like that in
Here that can really use all these features to its benefit not a company who creates a shitty game and launches it within a few few months um and somehow creates an unlimited pool of tokens list sits and dumps on the user right we don’t want that that’s what we
Have we don’t want that if you want this to sustain right and like I said issues need to be addressed on boarding accessibility scalability unsustainable business models complexity for developers Etc right so we need to address this there is immense potential here right the shift from play to ear to
Play to own models focuses on longetivity and joyment considered more sustainable but that can only happen if the gaming experience is really really good look at an example of Bitcoin right now Bitcoin is not a game but just saying right A lot of the times you see
These numbers 70% of volume unmoved 75% of volume unmoved a lot of people just buy Bitcoin and they store it and they forget about it and the reason for that is they want to own Bitcoin they don’t you know they don’t want to just trade Bitcoin and there are certain people who
Do that but majority of the folks don’t want and that creates a market that creates a market that can last for many years right and that’s what I think game developers and these companies should focus on right onine gaming I all again say can revolutionize the blockchain gaming landscape with advancements
Driven by rapid development even in Technologies like AI imagine introducing AI around some of the onchain gaming really high highend games and stuff like that so technology is there it’s it’s growing you just need the right investor mindset to focus focus on investment to build infrastructure to build uh you
Know to give money for for certain things and you really need like a really good entrepreneurs here who can actually come in and focus on building a great user experience because money will follow after that right Next Generation blockchain games are anticipated to offer improve user experience viable
In-game economies right that’s what you know a lot of development is focused on we’ll see how that goes uh continuous Investments are needed increased activity is needed and a robust blockchain development landscape is needed needed and if it’s done right that would position this industry for
Future growth so I do believe right in my conclusion that there is a billion dollar industry emerging here provided that we do the right things at the basic level we we make games that will last we make games for user experience we make games for making onboarding accessibility really simple we make
Games on scalable layer ones that will help customers right when it comes to high traffic you know high traffic season sustainable business models that will help establish a good pay to own rather than pay to earn right models and and remove complexity for developers and make them engage to develop I think
Those are the things that you know these entrepreneurs who are trying to build the company out of this need to focus on and there is a 100 plus billion dollar industry right in your grasp in the next 4 4 to 5 years if you were to do
That all right that’s all I had hopefully you guys get a really really good you know view of the gaming industry the potential of that as we look at blockchain on the whole you know do your own research around the tokens right you know I we didn’t want to get
Into which tokens are doing this which tokens are not because again we do not recommend like different tokens or stuff like that but I’ve given you the basic education I believe that is needed for you to make a decision now go ahead make your own decision on which assets you
Feel are the ones who are actually hitting the right themes like we discussed and invest in them because that’s what’s going to change this business trajectory uh if you like the content please hit a like And subscribe to the channel you can follow us at the
Arinal you can follow it as ar. Xyz right uh at Aral is is our Twitter or X handle uh you can join a group on telegram that’s where we take some suggestions on what to make and also on Instagram hope you had a good learning session about the whole gaming industry
Um if you know go ahead and send your feedback and suggestions as comments on the video uh have a great rest of the weekend and I will see you guys next week all right take it easy guys bye
3 Comments
Thanks alot for the video❤
Thank you! What blockchain gaming platforms are you looking at from an investment perspective that you feel can have substantial growth over the next 5 years?
Again, excellent video !!!