How GameFi is now beyond fun and games
2021 was most certainly the year memecoins, thanks to Dogecoin and other dog-meme currencies, but it was also the year of crypto gamification.
The concept of GameFi or Game Finance is popular among many crypto enthusiasts who are avid gamers too. It’s not surprising that both these sectors have now come together.
Crypto tracker dApp radar found that 49% of people with active crypto wallets used their wallets to play games last year. This is probably because, in DeFi-like fashion, gamers can earn returns, lend their virtual assets, and stake tokens they earn in games.
But a regular investor might be wondering - what is the significance of GameFi. Well, one recent example of this was when land on play-to-earn gaming platform Axie Infinity sold for over $2.3 million. As of October, 2021, Axie Infinity was valued at $30 billion:
Decentraland followed suit with its $2.43 million sale of virtual real estate. Most of these gaming platforms, with their eye-catchy visuals and ease of use, make investing and trading crypto tokens as easy as a pastime. This phenomenon which could drive mass adoption could usher millions into the crypto economy.
Although DeFi is where much of the money is, with 254 billion in total value locked, blockchain gaming sector secured $4 billion in investments in 2021. DAppradar predicts that this gaming industry will see "reasonable growth" in 2022. As a matter of fact, a record amount of venture capital flowed into blockchain gaming projects. For instance, Justin Sun, CEO of BitTorrent and founder of Tron launched a $300 million fund focusing on play-to-earn and GameFi. Andreessen Horowitz, valuing Sky Mavis at $3 billion, led a Series B funding round of $150 million.
Online gaming or e-sports had already been on the rise in the Middle East, especially in UAE and KSA. With that in mind some companies like Zone have introduced a gamefi - play-to earn- ecosystem in the region.
Governments investing in gamefi projects is not a new concept, with the nation of Barbados opening a diplomatic embassy in the Decentraland's virtual land. Moreover, UAE is keen on supporting crypto companies. Abu Dhabi State Fund Mubadala, which has $243 billion in assets, started investing an unspecified amount in cryptocurrencies recently, making it interesting to watch how the regional government bodies could get involved in the gamefi sector too.
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