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In 2022, when winter devastated the world of cryptocurrencies, the gamification of finance became a rapidly growing trend. Many analysts saw the combination of gaming with DeFi as something with enormous future potential. Just two years later, the GameFi sector is in a state of decline.
The latter is the result of an investigation by the firm ChainPlay, which describes that the sector can practically be described as dead. A recently published report provides some details on the status of projects related to this area.
It should be noted that the report places in the “dead” category those projects whose tokens are 90% or more below their maximums. Likewise, these projects must have 100 or fewer users. The work analyzes a total of 3,279 GameFi projects based on blockchain. All data collection for that research was conducted in November 2024.
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Among the results, it stands out that an average of 316 projects of this type are created each year. Of them, 262 disappear or fall into the category of “dead.” Meanwhile, 88% of GameFi sector tokens are 90% below their ATHs. Meanwhile, the average duration of a protocol of this type is 4 months before disappearing completely.
9 out of 10 GameFi projects are dead, according to research. Source: ChainPlay
Will the GameFi sector completely disappear?
Judging by the data from ChainPlay’s work, it can be said that GameFi needs a complete restructuring. The short life span of projects makes it difficult to attract investment capital organically. In this sense, the promotion of some of these protocols is merely speculative.
The fact that 9 out of 10 projects in the area are currently abandoned reflects that the sector is on the verge of extinction. Very few investors have worthwhile profits. These include retailers that injected capital into decentralized initial offerings (IDOs), which have an ROI of 15%.
Meanwhile, venture investors bear the brunt. The fact that these platforms’ tokens are so far from their ATHs suggests that they do not have enough demand. Thus, people prefer to pass by and bet on other project tokens that now provide better returns, as is the case with AI tokens and others.
The GameFi sector is one of the great promises that did not reach a high level of demand for a long time. It is likely that in a few years there will be a renaissance of this financial modality, but it will surely be under other conditions or after reform of the sector.
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