BGA Blockchain Game Report for the Second Quarter of 2021

In the second quarter of 2021, driven by the success of gamification finance, Wax blockchain and Axie Infinity, blockchain-driven games have attracted a wider audience. As the multi-chain paradigm gradually enters the game field, the game industry now provides developers with more options for releasing products on different blockchain platforms. As a business model, Play to earn has not only attracted the attention of industry insiders, but also the mainstream media. The most important thing is that consumers can interact with game dapps without worrying about transaction costs.

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Important points

Game users increased by 7 times

Ronin’s powerful game value

High activity of Wax blockchain

The strongest game in the second quarter of 2021

The demand for virtual land in the virtual world is strong

Collectors spend a lot of money on virtual character NFTs

Changes in the popularity of the NFT market

The rise of GameFi

Concluding remarks

Important points

In the second quarter of 2021, compared with the previous quarter, the number of active wallets interacting with blockchain games increased by 599%.

The Wax blockchain has become the market leader, with the number of daily active wallets interacting with blockchain games increasing by 1,082% every quarter to 306,707.

Axie Infinity has the highest value, trading $124 million in NFT transactions in June alone.  

Alien Worlds, R-Planet, and Upland have the most crypto wallets linked to their games every day. If these three games are combined, 301,000 wallets can be connected every day. 

US$42.6 million was invested in various virtual world land NFTs.

NFT collections such as CryptoPunks, Meebits, VeeFriends and Bored Apes have successfully created communities with a transaction volume of 380.7 million U.S. dollars. 

In the second quarter of 2021, NFT sales in markets that offer cheaper NFTs and do not require any transaction costs have increased.

Game users increased by 7 times 

At the end of March, the number of daily active wallets connected to game-related smart contracts in the blockchain ecosystem exceeded 51,000. In the second quarter, the number of daily active wallets on all blockchains soared to 359,284, an increase of 599%. It should be noted that we are talking about wallets that interact with smart contracts on the blockchain. Depending on the game, this will require multiple interactions in each round of the game, or only one interaction to get rewards.

BGA Blockchain Game Report for the Second Quarter of 2021

In the past three months, the game of earning money has received a lot of attention. This surge in interest is driven by the NFT collection and farming games that are accessible on the Wax blockchain, as well as the combat game Axie Infinity. Currently, the number of daily active wallets for blockchain games is approximately 375,000.

Most game activity occurred on the Wax blockchain, and its daily active wallets increased by 1,082% from the previous month to 306,707. Due to the rise of gamification finance or GameFi, Binance Smart Chain (BSC) increased its daily active wallets related to games by 412% to 8,641 in June. In third place is Ronin, an Ethereum sidechain created for Axie Infinity, with 7,897 active wallets every day.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

Although Ethereum’s transaction fees have fallen, the game field has not made progress. Instead, developers are looking for other solutions that provide cheaper and faster transactions. This is why Sky Mavis built the Ronin sidechain for Axie Infinity, but it is also one of the reasons why Wax blockchain games are so popular. Creating an account on Wax is as simple as connecting a social media account, thus creating a very accessible ecosystem. 

Although Polygon achieved initial growth in the first quarter, it did not increase its presence in the gaming ecosystem. Compared with the first quarter, the number of game users on Polygon only increased by 2% in the second quarter. However, Polygon has always attracted a variety of projects, including Decentraland, Ember Sword, F1 Delta Time and The Sandbox. As these projects integrate Polygon’s services, the situation in the second half of 2021 may be different. In July of this year, Polygon has announced the establishment of Polygon Studio, focusing on games. 

Ronin’s powerful game value

Although Ethereum still has the most total lock-up value (TVL) in the DeFi field, in terms of game value, the leading blockchain position is being surpassed. When Axie Infinity transferred the entire economy to the Ronin sidechain, NFT transactions generated incredible value. In June 2021, what we know is 124.2 million U.S. dollars, while the game NFT on Ethereum is only 16 million U.S. dollars.

Throughout the quarter, Axie Infinity began migrating to Ronin from the last few days of April, creating more than $162 million in NFT transaction volume. In the absence of Axie Infinity, the entire Ethereum gaming ecosystem adds up, and the NFT transaction volume is $64.4 million.

Ronin is the only blockchain solution in the gaming industry that exceeds Ethereum in terms of NFT transaction volume. In the second quarter, Wax’s transaction volume reached 26.6 million U.S. dollars, while Polygon’s transaction volume was only 3 million U.S. dollars.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

As people’s interest in Axie Infinity continues to grow, the value of Ronin will increase. At the same time, the value of the game’s NFT on Polygon will also increase, which is in line with people’s expectations. Many projects have announced the transition to sidechain solutions, which indicates that there will be an influx of users in the coming months.

High activity of Wax blockchain

As many games move to a low-cost blockchain environment, games will have a chance to flourish. Gamers can now send cheap NFTs to each other without worrying about excessive fuel costs. Axie Infinity’s switch from Ethereum to Ronin may be the best example, as the game’s trading activity increased by 1,409% in the last quarter to 574,653 NFTs.

In addition, Immutable also launched Immutable X, allowing players in the trading card game Gods Unchained to transfer cards for free. Later this year, Immutable X will open more projects, including War Riders and Guild of Guardians. 

However, in terms of data, there is one blockchain that stands out: Wax. The Wax blockchain claims to be the king of NFTs, allowing users to collect various digital assets from well-known brands, artists or games. Alien Worlds and R-Planet two games stand out, and Colonize Mars and many other games have also begun to emerge.

In the last quarter, players transferred more than 2 million NFTs in the Alien Worlds ecosystem. During the same period, R-Planet had 43,000 NFT transfers. In recent weeks, with the opening of new game features, activity around R-Planet has continued to increase. Due to its cheaper NFT and no transaction fees, it is not surprising that the Wax blockchain has the most NFT transactions.

In the last quarter, Wax’s NFT sales reached 2.3 million, easily surpassing the total NFT sales of Ethereum and Ronin of 779,000. As more game projects adopt side-chain alternatives, second-layer solutions or other blockchains, we expect that game activity on the Ethereum mainnet will further decline in the coming months.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

The strongest game in the second quarter of 2021

The most famous games in the blockchain game ecosystem have witnessed the growth of users. It is worth mentioning that each of these games runs on a blockchain solution that does not require players to pay transaction fees. Wax, Ronin, Hive and EOS all allow users to freely trade NFT without paying for fuel.

Without a doubt, the biggest news this month is Axie Infinity. The developers of Sky Mavis launched their own Ronin sidechain and migrated the entire ecosystem from Ethereum to Ronin. After the migration, activity increased rapidly. In June, Axie Infinity had 7,894 active wallets interacting with smart contracts every day. Compared with March 2021, this is an increase of 848%.

However, we only measure the interaction with the smart contract. Axie Infinity’s user base has soared to more than 300,000 players per day. This means that approximately 2.5% of players receive SLP rewards every day. This is why Axie’s data is lower than Alien Worlds, which is a game that always interacts with smart contracts.

In April of this year, the space mining game Alien Worlds experienced rapid growth. This Wax-based game increased from 18,922 daily active users in March to 258,728 independent daily active wallets (DUAW) in June. With game earning mechanisms, simple gameplay and easy entry, Alien Worlds users have increased by 1,267% in the past three months. It should be noted that one player can easily open multiple accounts in Alien Worlds. Therefore, players may have two, three, four, or even dozens of accounts.

Following Alien Worlds is another NFT-based farming game R-Planet. The number of users of this game has increased by 340%, reaching 13,151 active wallets per day. At the same time, Upland also performed strongly, with its user base increasing by 77% in June to 29,386 daily wallets. Among the most popular game dapps, Splinterlands achieved the least success, with an increase of only 13%, and the number of daily active wallets reached 8,614.

BGA Blockchain Game Report for the Second Quarter of 2021

The virtual land in the meta universe is in high demand

In the past quarter, we have seen an increase in Metaverse’s demand for real estate. Meta universe is a network where users can freely exchange value and data. There are various virtual worlds in Metaverse, and users can log in to these virtual worlds using encrypted wallets. In these virtual worlds, they can obtain a piece of virtual land. In the past quarter, the demand for this kind of virtual real estate has been increasing, and we have seen that this business has generated USD 426 million in transactions.

However, it is not appropriate to simply classify this type of transaction as a virtual world. In fact, other game worlds also provide a mechanism for players to obtain land NFTs. Such as VulcanVerse, Ember Sword, My Neighbor Alice and other games. However, for now we only focus on Cryptovoxels, Decentraland, Somnium Space and The Sandbox. These virtual worlds allow users to freely construct without being restricted by game mechanics or stories.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

The total amount of NFT transactions in these four virtual worlds exceeds 42.6 million U.S. dollars. Compared with the first quarter of 2021, this is an increase of approximately 63%, when the total value of NFT transactions in these virtual worlds was US$25.6 million.

At the beginning of this quarter, mainstream attention to the virtual world reached its peak, and CNBC called this innovation “fake land.” However, various high-profile transactions of $500,000 or more show that demand in this area has been growing. In Decentraland and The Sandbox, we can see some large plots being purchased. At the same time, as developers and communities add new features, the utility of these virtual plots is also increasing. Somnium Space now allows users to drive cars in a virtual world, while Decentraland allows users to buy physical products directly from the game world.

As mentioned earlier, the demand for virtual land is not limited to these four virtual worlds. In the last quarter, My Neighbor Alice and Ember Sword also sold their own virtual land. They sold virtual land worth millions of dollars to enthusiastic players and community members. Aavegotchi will also launch its own game virtual world; trading card game Dark Country is also involved in this field; not to mention Upland, it has been selling virtual real estate for some time.

Collectors spend a lot of money on virtual character NFTs

In the first quarter of this year, NFT collectors spent $229.5 million on NFTs such as Hashmasks and CryptoPunks. These digital artworks depict an avatar, which is often used by users as an avatar on social media. These types of NFTs are increasingly appearing in the meta universe, which is an extension of their owners, but their true identity has not been revealed. In the second quarter, user demand for such NFTs increased, and people spent $380.7 million on these virtual character NFTs.

It can be said that CryptoPunks opened the trend of NFT series. Although CryptoPunks is not the first NFT, it is a groundbreaking NFT series. As a result, these pixelated punks have become very valuable. For example, Sotheby’s auction house sold Alien covidpunk for $11.8 million. After that, other series came into being.

After the launch of Hashmasks in February 2021, a new trend emerged. Similar to CryptoPunks and Hashmasks, there are now a variety of NFT series based on personal avatars, which have become the latest publicity in the NFT field. In the second quarter of this year, Artvatar, Meebits, VeeFriends and Bored Ape Yacht Club released and created communities. If you own the NFT, it means that you are also a member of this community.

In these cases, the value of NFT depends not only on its appearance or rarity, but also on the content it unlocks. Meebits NFT can become a 3D avatar, Bored Apes can get exclusive merchandise, and RTFKT studio makes unique physical shoes for cryptopunk owners. VeeFriends NFTs even provide owners with the right to participate in exclusive physical activities. The result of these different NFTs is that they create fans, supporters, and builders, each of whom creates value for their particular ecosystem.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

The volume of transactions doesn’t tell everything. The launch of Meebits was a huge success, but over time, its sales began to decline. On the same weekend, Bored Ape Yacht Club was also released, and the number of transactions is also increasing. This trend paints a different picture.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

Here we can see the amazing trading volume of Meebits on the first day of release. After that, the transaction volume declined, but there was a slight increase in the last few days of June. However, at Bored Ape Yacht Club we saw a different trend, with low-value initial sales and transaction volumes increasing over time. Two weeks after the sale, the hype surrounding Bored Apes increased, and the value flowing into the NFT series rose.

Changes in the popularity of the NFT market

All NFT sales are conducted through the NFT market, and we have noticed a trend that more sales are conducted through markets that do not require any fees. Because we will compare the first quarter and the second quarter, we will put the Axie market aside. Note: Axie Marketplace has sold more than $500 million in the past 30 days, which is a force that cannot be underestimated.

In February and March 2021, NBA Top Shot’s NFT collection made its debut on the mainstream market. Basketball collections featuring NBA star players sell for thousands of dollars. Compared with the first quarter, sales in this market fell by 67%, from $467 million to $153 million. We can attribute this to the fact that the initial hype cycle has passed.

During the same period, the sales of OpenSea and Atomic Market increased by 60% and 968%, respectively. Among these markets, OpenSea has the highest actual processing value, valued at US$218 million. Atomic Market processed $12.2 million worth of NFT transactions.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

Comparing the situation in the first quarter and the second quarter of this year, it is interesting to see that the NFT market has begun to shift to offering free transactions. People are willing to buy cheaper NFTs, whether as collectibles or for DeFi or games.

Although the transaction volume of NBA Top Shot has declined, the sales of NFTs on the platform have risen from 3 million to more than 3.8 million. Among them, Atomic Market’s sales are only 12 million U.S. dollars, but its NFT sales are as high as 1.78 million. Compared with the previous quarter, an increase of 806%.

BGA Blockchain Game Report for the Second Quarter of 2021

Source: DappRadar

Buying NFTs is by no means a technological innovation, it is only for those who can afford to spend millions of dollars. Obviously this is an absurd idea. On the contrary, this technology has changed our perception of the ownership and value of digital assets. Whether it’s $1 or $10,000, there are NFTs available for purchase in various price ranges.

For low-value NFTs, it is important that these can be transferred without paying for fuel. When the fuel cost reaches the value of the NFT, the act of selling or buying becomes meaningless. The rise of Atomic Market on the Wax blockchain emphasizes this concept and shows the development direction of a broader market: NFT will be provided at a wider range of prices, across different platforms, and has the ability to transfer freely.

The rise of GameFi

For consumers, income from banking business in traditional finance is a passive job. However, on the blockchain, yield farming breaks this situation. Here, users can mobilize their funds and optimize their income to enjoy the best return on investment. This is why yield farming is a bit like financial gamification. In particular, Gamified DeFi is abbreviated as GameFi, which adds another layer of gamification.

The development of GameFi can be clearly seen on blockchains such as Polygon and Binance Smart Chain. On these blockchains, projects such as Mobox, Cometh, and Aavegotchi combine games with yield farming. In fact, these dapps on BSC are not very different from Alien Worlds. These projects combine passive game elements with NFTs and yield farming to form a new type of financial entertainment product. Some people believe that the future of financial institutions lies in the realization of gamification elements. In this case, these GameFi projects are the real front-runners.

Mobox exists on the Binance Smart Chain and contains elements such as yield farming, NFT pledge and games. Similar to the release of many DeFi projects, its first release had a huge impact, with transactions exceeding $26 billion in the first month. This includes users adding value to the liquidity pool, reducing that value, or staking tokens. As Mobox became a mature product, its trading volume declined. In June, its trading volume was $55.6 million, which is more similar to Aavegotchi’s performance.

Aavegotchi was released on the Polygon blockchain in March and received $14.6 million in revenue that month. In the second quarter, Aavegotchi proposed many future plans, including the introduction of new Gotchi and the entire MMORPG game world. Based on the above behavior, Aavegotchi’s transaction volume in the second quarter reached $8.7 million.

Mobox and Aavegotchi are just two examples of the megatrend of gamification of financial services. However, we can also change this trend and discuss adding financial services to the game. The mechanism of earning income through games combines entertainment and financial services, so there are many levels. Sometimes we will discuss the play-to-earn model, and sometimes we will discuss GameFi, but in the end these products are part of a larger trend in which gamification is used to entertain, attract and bind users to the product.

Concluding remarks

Blockchain games are at a crossroads. The rise of available technologies makes it easier for developers to integrate blockchain technology into games, while players can also get a better user experience. Cheap and fast transactions are important elements of user experience, such as Wax, Polygon and Immutable X. However, players also want a high-quality gaming experience. In the long run, this requires the participation of traditional gaming companies.

The increasing demand for virtual land and the hype around virtual character NFTs indicate that consumers are already willing to put their eyes on the meta-universe. The meta universe itself slowly emerged and presented itself as an updated version of the Internet. These people own various digital assets from community membership to game props and virtual land. All of these are linked together through cryptocurrency and become a virtual economy that spans the entire industry and empowers every player.

In the next few months, it will be interesting to pay attention to the development of GameFi and the mechanism of earning income through games. These blockchain-driven models will allow consumers to participate in creating value through gamification. The level of interactivity will determine whether we are talking about gamified DeFi or blockchain-driven on-chain games, which have a “play and earn” business model.

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/bga-blockchain-game-report-for-the-second-quarter-of-2021/
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