GameFi has faded in the past months, with a study suggesting that 75% of these projects have failed. Around 2,127 web3 games have failed in the last five years since the GameFi niche emerged, representing 75.5% of the 2,817 web3 games launched. In other words, 3 out of every 4 web3 games have become inactive.
On November 29th, CoinGecko released a statement on X saying:
“Ever wondered how many Web3 games have failed? Our study shows that approximately 3 out of 4 Web3 games have become inactive in the five years since the emergence of the GameFi niche.”
These stats have concluded that 3 out of 4 web3 games have been inactive after the launch of GameFi five years ago, after there were many active and played traditionally or involved in the play-to-earn mechanism.
GameFi came into the spotlight in 2018, following the success of CryptoKittles, a blockchain game developed by Canadian studio Dapper Labs, in late 2017. At the time, play-to-earn (P2E) gaming became a popular crypto narrative, resulting in 422 web3 games launched in 2018 alone.
Play-to-earn (P2E) is, however, a gaming mechanism that is involved in incentivizing players for their time and effort. Popular incentives include in-game cryptocurrencies and non-fungible tokens that can be traded, sold, or used as collateral in other financial applications.
What Went Wrong?
The 2019 and 2020 bull market initiated the traction in P2E games fading. There were only 244 web games launched during this period of two years. Eventually, the failure rate of these projects was 94.25% on average across these two years.
The web3 gaming stabilized slightly in 2021 amid the crypto bull run, which left the majority of non-fungible tokens rising to new record highs. During this time, the gaming ecosystem recorded the lowest web3 games’ failure rate of 45.9%.
| Year | No of Dead GameFi | GameFi Failure Rate |
| 2018 | 307 | 72.7% |
| 2019 | 149 | 94.3% |
| 2020 | 81 | 94.2% |
| 2021 | 339 | 45.9% |
| 2022 | 742 | 107.1% |
| 2023 | 509 | 70.7% |
According to this research, failed web3 games doubled last year with 742 amounts of dead games. During this time, the number of new web3 games remained high, but despite that, the failure rate rose to 107.1%. The downtrend was again related to the crypto market bear market, which started in mid-June 2022.
Lastly, among the almost 730 new web3 games launched this year, the study has revealed that 509 web3 games have become inactive since the start of this year alone, representing 70.7% of the web3 games launched this year.
Nonetheless, since the global NFT market has recently started its recovery journey, many sectors, including gaming, are expected to get back on their feet.
Learning from Failures
GameFi projects pose great vibes for web3. For now, it appears as the most community-considered part of the web3. Thus, GameFi projects would likely bend, never break. But for success, project owners need to be aware of what influences this space, to bypass failures and hold on till the better days.
For example, GameFi projects faced challenges due to the unpredictable nature of the crypto market. The changing market conditions greatly influenced the success or failure of these projects. Developers must stay aware of market trends and be flexible in their strategies to adapt to market shifts effectively.
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