Research Summary
The report examines the failure rate of web3 games, also known as GameFi projects, from 2018 to 2023. It reveals that out of 2,817 web3 games launched, 2,127 have failed, indicating a high failure rate of 75.5%. The report also provides a year-by-year breakdown of the failure rates, highlighting a peak in 2022.
Key Takeaways
High Failure Rate of Web3 Games
- Overall Failure Rate: The report reveals that 2,127 out of 2,817 web3 games launched in the last five years have failed, indicating a high failure rate of 75.5%. This suggests that three out of every four web3 games have become inactive.
- Annual Failure Rate: The average annual failure rate for web3 games from 2018 to 2023 has been 80.8%, based on the number of web3 games failed compared to launched. This highlights the volatility and risk associated with the GameFi niche.
Yearly Breakdown of Failure Rates
- Early GameFi Failure Rates: In 2018, 307 out of 422 web3 games failed, marking a failure rate of 72.7%. However, the failure rate rose to 94.3% in 2019 and remained at 94.2% in 2020, despite a slowdown in GameFi development and interest during the bear market of these years.
- Lowest Failure Rate in 2021: The year 2021 recorded the lowest web3 games’ failure rate of 45.9%, despite the number of failed web3 games jumping to 339, surpassing 2018. This was likely due to the crypto bull run during the year.
- Record Failures in 2022: The annual number of dead web3 games more than doubled in 2022, reaching a record yearly high of 742. This marked the highest failure rate of 107.1%, even as the number of new web3 games remained high.
- Failure Rate in 2023: As of 2023, 509 web3 games have failed, equivalent to 70.7% of the web3 games launched this year. The lower failure rate compared to 2022 could indicate a stabilization in the state of web3 gaming.
Actionable Insights
- Understanding the Risks: Stakeholders in the GameFi niche should be aware of the high failure rate of web3 games and consider this risk when developing or investing in new projects.
- Monitoring Market Trends: The fluctuating failure rates over the years suggest that market conditions, such as bull or bear markets, can significantly impact the success of web3 games. Therefore, keeping an eye on market trends could be beneficial for predicting the potential success of GameFi projects.
- Exploring Stabilization Indicators: The lower failure rate in 2023 compared to the previous year could indicate a stabilization in the state of web3 gaming. Further research into this trend could provide valuable insights for future GameFi projects.
