October 2024 Blockchain Game Research Report: Interpretation of the Latest Trends in Active Users and On-Chain Game Ecosystem

Author: Stella L (stella@footprint.network)

Data Source: Footprint Analytics Games Research Page

In October 2024, the Web3 gaming market showed steady performance, contrasting with the broader growth trend in the crypto market. Bitcoin rose by 15.9% during the month, nearing its historical price peak, while the market capitalization of gaming tokens remained at $21.15 billion, close to last month’s level. Daily active users reached 5.3 million, primarily driven by Telegram-based games, particularly with significant user growth achieved by blockchains such as Matchain, Sui, and Core through the introduction of Telegram games.

Several important developments occurred this month: traditional gaming giant Ubisoft launched its first blockchain game on Oasys, and crypto fund VanEck invested in Gunzilla Games. Meanwhile, funding continues to flow into the industry, with Azra Games raising $42.7 million.

Macroeconomic Market Review

In October, the crypto market exhibited mixed performance, with Bitcoin showing significant strength while other sectors saw more moderate gains. Bitcoin rose from $60,764 to $70,398, an increase of 15.9%. Notably, Bitcoin reached $72,751 on October 29, close to the historical high of $73,104 set on March 14, 2024. In contrast, Ethereum's performance was relatively flat, rising from $2,453 to $2,519, only a 2.7% increase.

Data Source: Bitcoin and Ethereum Price Trends

The crypto market in October was significantly influenced by the macro environment. The dollar strengthened while the yuan weakened, exacerbating concerns over trade tensions and tariff risks. This currency volatility accompanied rising bond yields and increasing gold prices, indicating a complex shift in global risk perception and investment flows.

As the U.S. elections approach, political factors increasingly influence market sentiment. Investors are positioning themselves ahead of potential policy changes, accelerating Bitcoin's gains as the market weighs the implications of different election outcomes on digital asset regulation and financial policy.

Institutional activity remained strong this month, with Bitcoin exchange-traded products (ETPs) recording substantial net inflows. This sustained institutional interest, coupled with Bitcoin's performance diverging significantly from other crypto sectors, indicates that large investors are becoming increasingly selective in their allocations.

Regulatory developments continue to impact the market landscape. The FBI's investigation into NexFundAI tokens through "sting operations" marked a significant milestone, leading to market manipulation charges against three cryptocurrency companies and 15 individuals. Meanwhile, Crypto.com's legal battle with the SEC highlights the ongoing tension between industry participants and regulators.

Blockchain Gaming Market Overview

In October, the blockchain gaming industry showed mixed signals, with token market capitalization stable but user metrics exhibiting notable changes. The market capitalization of blockchain gaming tokens slightly increased from $21.07 billion to $21.15 billion.

Data Source: Blockchain Gaming Token Market Capitalization and Bitcoin Market Capitalization

User engagement metrics showed greater variation, with daily active users (DAU) reaching a new high of 5.3 million in October, an increase of 11.3% from September. This growth was primarily influenced by a peak in user metrics for Matchain during October 10-13, when it launched four games within the Telegram ecosystem. The surge in Telegram gaming-related activity continues to reshape user acquisition patterns.

Data Source: Daily Active Users in Blockchain Gaming

The number of transactions showed moderate growth, with an average daily transaction volume of 9.3 million, a slight increase of 2.1% from September. However, this growth rate remains lower than that of DAU, with the transaction volume per user remaining flat compared to September.

Data Source: Daily Transaction Counts in Blockchain Gaming

Transaction amounts showed a slight contraction, with average daily transaction value decreasing by 1.9% to $7.5 million.

Data Source: Daily Transaction Amounts in Blockchain Gaming

These metrics hold particular significance in the broader context of cryptocurrency adoption. a16z released the report titled "State of Crypto 2024", estimating that the current active crypto users range from 30 million to 60 million, accounting for 5-10% of the total global crypto user base of 617 million reported by Crypto.com in June 2024. This significant gap highlights an important opportunity: converting existing cryptocurrency holders into active users. Although Web3 gaming has long been viewed as a crucial catalyst for the widespread adoption of blockchain, its performance in the current market cycle indicates that challenges remain in realizing this potential.

How are builders in blockchain gaming adjusting their strategies to bridge this engagement gap? We will explore this further below.

Overview of Blockchain Gaming Public Chains

The number of active blockchain games reached 1,606 in October, a slight increase of 1.6% from September. BNB Chain, Polygon, and Ethereum led the market with shares of 22.5%, 18.4%, and 13.6%, respectively.

Data Source: Proportion of Active Game Projects on Each Public Chain

The DAU metrics indicate a shift in the competitive landscape, with opBNB, Ronin, and the emerging Matchain being the top-performing chains. The average DAU for these chains was 1.2 million, 886,000, and 548,000, respectively, capturing 25.6%, 13.1%, and 11.2% of the DAU market share by the end of October.

Data Source: Daily Active Users on Each Public Chain

opBNB showed strong growth momentum, with average DAU increasing by 10.5% from September, primarily driven by GombleGames and Alliance Games, which saw user growth of over 100% and 78%, respectively. Interestingly, this growth reflects the BNB Chain's shift towards developing blockchain games on opBNB, while the BNB Chain itself experienced a 43.8% decline in average DAU.

Matchain, a decentralized AI blockchain focused on data and identity sovereignty, launched its mainnet in August. The daily average users on this chain surged from 78 in September to 548,000 in October, driven mainly by Telegram-based games such as LOL, Jumper, and Digiverse. During the peak period from October 9 to 13, Matchain's performance reached a high of 2 million average DAU, peaking at 3.3 million DAU on October 12. Although the user count significantly declined afterward, it stabilized at around 615,000 in the last week of October. The increase from 78 to 548,000 DAU demonstrates the potential and challenges of user acquisition within the Telegram ecosystem. This is a common challenge faced by the Web3 gaming industry, where projects struggle to maintain the momentum of initial user growth and achieve sustained organic growth.

Data Source: Daily Active Users on Matchain

Sui performed strongly, with average DAU increasing by 105.1% to 186,000. Several Telegram-based projects drove this growth, including BIRDS (a Memecoin and game mini-app) and MemeFi. Notably, MemeFi shifted its token issuance from Ethereum L2 Linea to Sui a few weeks before its airdrop event. This strategy of combining Memecoins with gaming appears to be Sui's approach to maintaining user engagement.

Core saw its average DAU increase by 75.7% to 109,000, driven by traditional Web3 games like World of Dypians and Pixudi, as well as new Telegram-based games. The "Talk-to-Earn" and "Tap-to-Earn" game TomTalk achieved significant success, accumulating over 1 million users on Core within a month. Core's strategy seems to focus on long-term ecosystem development through strong partnerships, such as collaborations with TomTalk and Pixudi.

The average DAU for TON decreased by 27.7% to 195,000, reflecting a decline in activity for several games following their token generation events (TGE). However, TON's success in user acquisition within the Telegram ecosystem has prompted imitation across the industry. Besides TON, several chains are now actively targeting the Telegram user base. Matchain, Sui, and Core have achieved notable success in this regard, while emerging chains like Sei, Ancient8, and Viction are also implementing similar strategies.

Meanwhile, other chains face their own challenges and opportunities. The Arbitrum community proposed a plan around the "Game Catalyst Program" (GCP) involving a $220 million initiative, suggesting the return of 220 million ARB tokens allocated by the foundation to the treasury, highlighting the demand for financial and operational transparency regarding the GCP.

In contrast, Immutable zkEVM has taken a strategic step towards decentralization by removing its deployment whitelist and enabling permissionless deployment. Since launching its testnet in March 2024, Immutable zkEVM claims to have achieved significant growth, with over 2.5 million monthly active users on-chain in the first quarter.

Immutable

Overview of Blockchain Games

By the end of October, the blockchain gaming ecosystem comprised 3,503 games, of which 1,336 remained active. There were 283 games attracting over 1,000 monthly active users (MAU), accounting for 8.1% of the total number of games and 21.2% of active games.

Data Source: Monthly Active Blockchain Games Count

The phenomenon of Telegram games continues to shape the industry landscape, but it also faces sustainability challenges. Hamster Kombat topped the October Telegram games mini-apps with 51.9 million MAU. However, the claimed user numbers (close to 300 million in August and September) contrasted sharply with the latest retention figures, and the token price dropped by 70% from its historical peak after the TGE, indicating that the project still faces opportunities and challenges in converting initial user interest into sustained engagement.

Data Source: Popular Telegram Mini Apps Ranking

On another front, Ubisoft entered the blockchain gaming space with Champions Tactics: Grimoria Chronicles, a tactical RPG launched on October 23 on Oasys's Layer 2 Home Verse, focusing on PvP combat and team-building mechanics.

A notable investment event this month was VanEck's crypto fund announcing its investment in Gunzilla Games. VanEck had previously invested in Parallel. Gunzilla launched its highly anticipated game Off the Grid on PlayStation 5 and Epic Games this month. Off the Grid is built on its blockchain Gunzilla (recently upgraded from an Avalanche subnet to L1), but explicitly positions the game in its official Q&A as "not an NFT game", rather a battle royale game with "optional NFT elements." This reflects a trend of integrating blockchain features as auxiliary mechanisms rather than core components of the game.

Off The Grid

This evolving approach to blockchain integration, particularly driven by established gaming companies, indicates market maturation, where technology is used to enhance rather than define the gaming experience. This subtle shift may bridge the gap between traditional and Web3 gaming.

Blockchain Gaming Investment and Financing Situation

In October, the Web3 gaming industry exhibited strong growth in investment activity, raising a total of $94.6 million across 13 financing events, a significant increase of 44.2% compared to September. Four of these activities did not disclose their funding amounts.

October 2024 Blockchain Gaming Investment and Financing Events (Source: crypto-fundraising.info)

A highlight of this month was Azra Games raising $42.7 million in Series A funding, led by Pantera Capital, with support from industry giants like a16z crypto, A16Z GAMES, and NFX, indicating confidence in advanced mobile gaming experiences. Azra's vision for a "fourth-generation mobile RPG" marks a significant evolution in mobile gaming, offering a console-level gaming experience with open worlds, complex camera systems, real-time combat, and extensive PvE activities. An increasing number of investors are betting on the fusion of console-level gaming experiences with mobile platforms, suggesting a potential shift in how Web3 gaming is consumed.

The infrastructure sector also showed activity, with Alliance Games securing $5 million in Series A funding led by Animoca Brands and Asymm Ventures. Alliance Games focuses on AI-driven decentralized infrastructure, addressing key needs within the ecosystem.

The data in this report is sourced from Footprint Analytics' Games Research page, a real-time data dashboard providing comprehensive and reliable statistics on Web3 gaming. If you find any chains or games that are not included and wish to have them added to the dataset, please contact us. You can also submit contracts through this link.