Crypto winter doesn't appear to be scaring away investors in the burgeoning NFT and blockchain gaming space. According to a new report from investment bank Drake Star Partners, crypto-related gaming companies accounted for roughly half of the last quarter's private financing, or about $1.2 billion.
So far this year, investors have poured more than $3.4 billion into NFT and blockchain gaming companies. That's remained steady for the past nine months, despite around $2 trillion of value disappearing from the crypto market since its November 2021 high.
"While the Crypto market continued to be under pressure, investors continued to show strong interest in blockchain gaming companies," the company wrote. "Half of the total amount raised and 40% of all financing rounds for private gaming companies were investments in blockchain gaming."
The blockchain gaming sector, which includes both collectible NFT projects and also games built entirely around blockchain technologies and cryptocurrency, continues to grow as Web3 hopefuls ride a wave of hype created around the metaverse. But so far, very few of these games have attracted more than a few thousand players, and the mainstream adoption and popularity of these technologies remains very much in question.
Earlier this month, crypto app platform DappRadar said it recorded fewer than 40 people interacting with proto-metaverse platform Decentraland's smart contracts, after which Decentraland's parent company clarified that about 8,000 people log in every day but mostly do not do anything blockchain-related. On the other end of the spectrum is Meta, the most high-profile company to plunge headfirst into Web3 with plans to build an interoperable, immersive metaverse. Yet even Horizon Worlds, Meta's flagship social platform, has seen declining monthly users from 300,000 people per month in February to less than 200,000 this month.
As for NFTs, trading volume for the digital tokens has fallen 97% from its record high in January of this year, according to Bloomberg. NFT projects have also faced vocal backlash from the broader game community, a trend that does not appear to be abating any time soon even as more companies try to dip their feet into the market.
Sony this month launched a new loyalty program called PlayStation Stars in which players can earn digital collectibles for buying and playing games on the platform. When asked whether the program would be selling or offering NFTs, a PlayStation representative was emphatic in stressing to The Washington Post that it was not entering the crypto space: “It’s definitely not NFTs. Definitely not. You can’t trade them or sell them. It is not leveraging any blockchain technologies and definitely not NFTs."