Skill Tree #13 - April 02
🔥 Insight of the week
The mobile gaming market in 2023 [🔗 Link]
Hypercasual games downloads are -24% YoY while hybrid-casual is up 13%. Hybrid casual games hit $1.4B in revenue in 2022, with downloads reaching 5.1B.
Hypercasual games have it difficult to monetize while hybrid casual games bring additional game mechanics that help improve activity and retention (see graphic below). Progression systems offer monetization opportunities as well. That being said, hypercasual games are still the most downloaded games. However, that also is an indicator that players quickly jump from title to title.
All genres show difficulties with monetization. RPG and strategy as the top grossing genres saw revenue fall -14% and -7%. Shooters have been hit the hardest (-22%). Only action games saw a revenue increase (+9%).
Mobile web3 games reached 46m downloads in H1 2022, and 29m downloads in H2.
On the monization side, Live Ops are used by 91% of mobile games, underlining the trend of games-as-a-service. Heroes collection is an important revenue driver and can be found in 7 of the top 10 titles by revenue.
Social features increase user engagement.
🧵 Twitter threads
Analysis of the game logic of two new skills in Zelda: Tears of the Kingdom [🔗 Link]
Fuse (weapon composability)
Players can combine resources to forge new weapons
motivates exploration and experimentation, providing players with multiple options to experience the game
all resources have diverse values to them as they can be combined in different mixes (vs having a clear value structure based on stats)
less anxiety when weapons break as it allows for more experimentation
Ultrahand (vehicle composability)
Players can modify vehicles, opening up different possibilities of moving around the world. For example, fans can be placed to allow for movement on land, in water or in the air
inspires experimentation and increases player agency
as fans are consumables, vehicles get a consumable component to them, requiring continous “investment”, aka demand for fans
How Mighty Bear Games is using AI in game development [🔗 Link]
Questioning ‘WL to future paid mints’ as a utility for free mints [🔗 Link]
Adding to this, also the factory NFT model (OG holders receive free airdrops) comes with challenges. The complexity of providing utility and potentially value capture to NFTs increases with the number of collections. New collections dilutes existing NFT holders as the value captured within an ecosystem has to be distributed over more NFTs. Therefore, it’s key that the value added by new collections is greater than the dilution.
The problems of eSports organizations and web3 as a potential path forward [🔗 Link]
Main issue: No clear path to profitability as esports orgs are dependent on game publishers who hold all the rights.
Web3 may provide a way for esports orgs to more directly participate in the commercial success of games.
Mirroring: Using NFTs on another chain without bridging [🔗 Link]
The current Blockchain Gaming landscape [🔗 Link]
Estimated $70B market in 2030.
📚 Blog posts
Pureplay on-chain games [🔗 Link]
Tech trends that enable on-chain games
ZKPs protect sensitive information (e.g. fog of war) and allow for more complex game mechanics
Account abstraction improve UX
Generative AI allows in-game agents to participate in world building
What makes on-chain games special:
On-chain games are permanent, making them feel more immersive. Additionally, they’re always-on, requiring a new extent of social coordination between players.
On-chain games allows for open collaboration, where players can move from consumer to prosumer (producer and consumer). Players take a more active role, driving experimentation. The extent to which players can contribute is much larger than with UGC creator tools. While the creator base may be smaller here because of the required knowledge, it comes with higher chances of finding big innovations (vs mostly copycats of other popular games on UGC platforms).
The future of in-game content revolves around public domain NFTs (CC0) which enables easy sharing. modification, and remixing.
Economic hyperstructures will emerge from open economies. Hyperstructures emerge through interdependent relationships between individuals, NFTs, and game modules.
Protocol DAOs will be responsible for building and maintaning repositories of components. DAOs enable players to contribute more easily, unlocking community ownership as governance tokens may be issued as a reward.
Inter-game tokens (e.g. Magic) allow to transfer time investment (and its associated value) between games.
Innovative gameplay loops through asset yields and genre overlap. Additionally, new game layers like the metagame, which is focused on diplomatic and economic activity, will emerge.
The future of gaming is on-chain [🔗 Link]
Mobile gamers spent $1.6B+ weekly in Q1 2023 [🔗 Link]
On-chain games: Finding game design patterns that are appropriate for blockchains [🔗 Link]
No randomness during the game (the initial game setup can have randomness) → no need to pay for outside oracles or ruin UX with weird ways of generating randomness
Decisions take long and can be batched → no need for high throughput
Players can move in parallel and don’t need to wait for each others’ moves
Artificial scarcity in virtual in the digital world and games [🔗 Link]
Inflationary pressures seen in Axie lead caps to prevent hyperinflation (usually a two-token model). But, fixed supply limits flexibility. Supply caps are usually set at the start based on forecasts and may lead to over- or underproduction at the end. Until then, systems tend to fluctuate between over- and underproduction as ecosystem growth varies over time. This results in boom and bust cycles.
Fixed supply only becomes relevant once the cap is reached, therefore we have no learnings yet on the long-term effects as most tokens haven't reached their cap yet.
imo, having a fixed cap not the best solution to prevent inflation. A better approach controls total inflation (instead of per-player inflation). The inflation should be dependent on real value-add activities in the economy (as opposed to simple P2E). Inflationary rewards can be used to incentivize activity with an economic value to the degree it’s needed within the ecosystem. For example, UGC skins can have value, but we don’t want the market to be flooded with copycats.
On the other side, token sinks can be used to keep inflation and burning in balance.
GameFi Growth: How to Keep Player Retention [🔗 Link]
The ‘True Ownership’ Trilemma in web3 [🔗 Link]
Delphi’s report on TreasureDAO [🔗 Link]
🎙️ Videos & Podcasts
Big announcements by Ronin network [🔗 Link]
Ronin network is the gaming blockchain by Sky Mavis (Axie creators).
Ron staking is live. Staking rewards start on April 12. Stakers can delegate their tokens to any of 22 validators.
5 games are coming from partnered game studios. These are the first titles outside of the Axie IP
The Machines Arena (Directive Games) - cross-platform, team-based shooter. PvP & PvE modes.
Tribesters: Island of Solas (Tribes Studio) - social MMO
Axie Champions (Bali Games) - match3
Bowled - cricket game
Battle Bears Heroes (SkyVu) - MOBA
Oasys partners with Japanese games media company Famitsu to create Blockchain Famitsu [🔗 Link] h/t @Nodra00 for the find
Otherside (Yuga Labs) announces collection-based 2D strategy game “Legends of the Mara“ for May, together with a related NFT collection [🔗 Link]
Disney lays off 50-member Metaverse team [🔗 Link]
YGG, Game7, Magic Eden, and Fenix Games form Web3 Games Collective [🔗 Link]
Web3 Games Collective’ goal is to find the first big web3 titles and support them with distribution.
RPG ‘The Legend of Aurum Draconis’ launches on Avalanche [🔗 Link]
🕵️ New projects
Epoch2140 | Virtual sports league
Gas Giant Games | Game studio working on an ARPG
NeoSwap AI | AI-powered trade discovery for NFTs