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The Web3 gaming ecosystem has come a long way since the debut of Crypto Kitties which introduced non-fungible tokens (NFTs), setting the stage for their use in blockchain-based games.
Fast forward to today, this niche is one of the most active crypto sectors. The latest report by DApp Radar revealed there were over 7.4 million daily Unique Active Wallets (dUAW) while on-chain transactions related to the Web3 gaming eclipsed 5.7 million in 2024.
But despite the growth over the years, one can’t help but notice that blockchain games are not as popular as they were at the height of the NFT boom in 2021. Currently, AI DApps account for the largest share of on-chain activity, having gained significant traction over the past year.
It is also worth mentioning that most of the in-game assets that were deemed valuable three years ago have lost a considerable amount of value. For example, the average price of acquiring one Axie NFT today is at around $100, this figure is down from the highs of $300 when a good number of people in the Philippines were playing this NFT-powered game as a source of living during the covid pandemic.
What went wrong and how can Web3 games get it right in the next phase of adoption?
Now that BTC’s price blew past the $100k mark and Trump’s pro-crypto administration has assumed office, it is more likely than not that interest will return to the digital asset industry. One of the biggest beneficiaries if this happens will be the Web3 gaming space, but this time, stakeholders have to get it right!
The Shortcoming in Earlier Versions of Web3 Games
One of the criticisms of earlier iterations of Web3 games is that they lacked advanced gameplays to keep players coming back. Most of the games that launched during the NFT hype revolved around collecting digital assets or subpar gameplays that were nothing close to what existing Web2 games like Fortnite, Call of Duty, League of Legends and Dota offer.
This shortcoming in both the gameplay and user experience has seen games that started out with much promise such as Star Atlas and The Sandbox become just another statistic. The former was marketed as a next-gen space MMO with AAA visuals and went ahead to raise millions in funding, only to deliver a mediocre gameplay based on speculative tokenomics.
As for the Sandbox, this metaverse world launched with a bang, attracting all sorts of heavyweight investors to purchase virtual land; this includes rapper Snoop Dogg, Binance and Atari. However, despite this traction, the Sandbox is yet to deliver on a compelling gameplay beyond speculating on virtual land. This partly explains why the floor price of land on this metaverse has plummeted from as high as $16k in 2021 to around $294 as of writing.
It is also worth noting that most of the pioneer Web3 gaming platforms or games did not have a sound tokenomics model. In fact, a good number are based on an inflationary tokenomics model which means that new tokens or in-game assets are constantly being introduced into the market, either as rewards or other forms of tokenomics management. Naturally, these tokens have lost their value based on the law of demand and supply.
Funtico – A Case Study
While there are multiple Web3 games that have successfully implemented both a competitive gameplay and sound reward mode such as Gods Unchained which features a controlled emission for its in-game utility token $GODS, one that particularly stands out in the modern Web3 gaming space is the Funtico gaming ecosystem.
This chain-agnostic Web 3.0 gaming platform is built on three fundamental principles; incredible rewards, smooth play and tournament-centred. Funtico’s gaming ecosystem includes multiple on-chain games; the most prominent one is a classic kart racing game dubbed Formula Funtico. There have been several tournaments in this game, with the current one “The Start Of A Revolution!” featuring prizes that total up to 100,000 USDT.
This incentive coupled with other initiatives such as leaderboards and the ability for player or avatar customization is what sets apart Funtico’s competitive gaming experience.
As for the sustainability of this Web3 gaming ecosystem, Funtico launched a token generation event (TGE) on January 27, 2025 for its utility token $TICO. Unlike most inflationary tokenomic models, this native token is designed to preserve the value of the rewards that players receive as in-game assets. The token’s distribution model includes a vesting provision for 88% of all the $TICO that will be distributed.
For instance, the $TICO tokens allocated in the seed and private sale have a vesting period of 12 months while in-game rewards will be vested for 24 months. This approach to tokenomics, although still inflationary, ensures the price of $TICO remains valuable while giving ample time for the ecosystem to grow. As such, Funtico is well positioned to achieve a sustainable tokenomics model given that early investors have to hold their tokens for a certain number of months.
Conclusion
The Web3 gaming ecosystem continues to evolve everyday, innovators are constantly coming up with more advanced gameplays and tokenomic models. This commitment towards building a sustainable gaming space is evident in the latest iterations of Web3 games; while it may take a while before innovators finally get the right formula, we’re almost there. Gone are the days when Web3 games were purely based on NFT speculation, the current era is paying more attention to the gameplay and sustainability. This mindset will play a huge role in shaping the future of Web3 gaming.
