Home » news » play to earn games under pressure amid bear market and growing criticism

Play-to-earn games under pressure amid bear market and growing criticism

The play-to-earn blockchain gaming sector is currently under pressure. P2E gaming exploded in popularity in 2021, but the trend reversed in 2022 amid an intense bear market whose effects spread across the entire crypto industry.

Play-to-earn gaming industry is under pressure

The popularity of P2E gaming exploded at around the same time as the popularity of cryptocurrencies. The rise of NFTs further ignited more interest in the P2E gaming space as they allowed the players to generate passive income.

However, some of the largest players in the P2E gaming sector have felt the pinch of the changing climate. Axie Infinity, which dominated the P2E gaming space in 2023, has recorded a notable decline in player numbers. In the past month, Axie Infinity has recorded around 430,000 players. AXS, the game’s native token, has plunged by more than 90% from its all-time highs.

Besides the effects of the bear market challenge, the other main challenge facing the P2E gaming industry is the criticism from traditional gamers and gaming developers. The traditional gaming space has criticized P2E because of its focus on monetary benefits and not on the game itself.

The drop in the number of players on P2E gaming platforms such as Axie Infinity could be attributed to the dropping likelihood of making good returns. Without the earning feature, many P2E games are abandoned by the players, which is a challenge that these platforms need to address.

Some P2E gaming companies plan to solve this problem by bridging the gap between Web2 and Web3 gaming. The Team Lead at W3E, Damian Bartlett, believes blockchain games should offer the same gaming experience as Web2 games. W3E is the first Web3 LAN gaming tournament globally.

Bartlett noted that players wanted fun games and the ability to be part of the ecosystem. However, the majority of P2E games were focused on speculative assets rather than the game itself. Moreover, most of these games were controlled by decentralized autonomous organizations (DAOs) that made decisions on behalf of the players.

“A good Web3 game will simply be a fun game that people are playing regardless of assets, some NFT assets they can buy if they choose to and the ability to buy in and sell out without the complications of unstable game currencies devaluing everything,” Bartlett added.

P2E games need to adopt a sustainable model

The community believes P2E games need to evolve and adopt more sustainable models. Most of these games have been likened to Ponzi schemes, where the contributions of new investors are used to pay off the old investors.

One of the proposed ways of achieving sustainability is providing the players access to in-game items and rewards that can be traded on a blockchain-based marketplace. The majority of Web3 games also lack a friendly user interface, with the solution being working together with Web2 studios and IPs.

Despite the effects of last year’s bear market, blockchain gaming comprised nearly half of the entire on-chain activity. However, the sector’s growth will depend on whether Web3 games can outperform Web2 games.

 

Ali Raza

Leave a Reply

Your email address will not be published. Required fields are marked *