Published on: 18/07/2022
Blockchain gaming show resilience as NFT markets fall
The bearish sentiment in the current crypto market has caused a drop in the sales of gaming NFTs, with “organic sales of gaming NFTs fell 29 percent” compared to Q1, and the price of in-game assets “negatively affected due to the fall in the value of many game-related cryptocurrency tokens”, per DappRadar’s Q2 Game report.
This is in line with how NFT marketplaces are faring following the crypto crash — the sector saw a decrease in weekly trading volume from 1.3 million ETH in May to a measly 600,000 ETH in June. However, some projects are unexpectedly showing resilience to the bearish pressure.
Splinterlands, for example, has remained to be the most-played blockchain game with 283,729 Unique Active Wallets (UAW) at the end of the quarter, closely followed by Alien Worlds, whose UAW decreased by a paltry 4 percent in Q2 despite the overwhelmingly negative sentiments in the NFT space.
Additionally, NFT games on other blockchains, such as Sunflower Lands on the Polygon blockchain, have their UAW increased by 10,000 percent to over 11,000 unique users. Another example is Gameta on the Solana blockchain, which ended the quarter with more than 30,000 UAW.
Of course, those above are notable exceptions — Axie Infinity, a giant and a household name in NFT gaming, for instance, has exhibited an 83 percent loss in its player base after the $600 million Ronin bridge hack incident earlier this year.
Despite the bearish sentiments Axie caused, however, many venture capitalists are still pouring money into the sector, with the amount invested this year being 33 percent higher than last year. The sector is also expected to bring in more than $12 billion in investments by the end of the year.
The DappRadar report above also revealed that blockchain gaming activity still expanded by 197 percent year on year, implying that blockchain gaming might be one of the most resilient sectors in crypto, with Wall Street giant Morgan Stanley reportedly eyeing an $8 trillion potential market.
Blue chips also faring fairly
Meanwhile, the bear market has caused NFT investors to look for more stable projects to invest in and pushed them to focus on more stable NFTs and projects, with blue chip collections “performing vastly better than the vast majority of NFTs”, according to Pedro Herrera, senior blockchain analyst at DappRadar.
Louisa Choe, a research analyst at blockchain analytics platform Nansen, also voiced a similar sentiment, noting, “ETH inflows and circulations are concentrated in Blue Chip or large-cap NFTs within the NFT market. Such a phenomenon hints at the risk-off attitude among NFT market participants.”
Projects considered blue chip NFTs, such as CryptoPunk, are indeed apparently still receiving investors’ interest. CryptoPunk #4464, for instance, was sold for 2,500 ETH, which is about $2.6 million at the time of sale. This is the fourth-largest CryptoPunks sale of all time.
Another example is the mainstay name in the NFT space, Bored Ape Yacht Club. Its cheapest NFT has only decreased by about 1 percent in value to $90,000.
It should be noted that these do not necessarily suggest that the market is slowly recovering, however, with investors still wary about NFTs’ inherent lack of liquidity in general, as well as other security issues and concerns.