Venture-Backed Web3 Gaming Raises Are Heating Up
Everyone says gaming on blockchain is the future, but we might be getting closer to it becoming the present.
by Adam Kreitzman, intern
As blockchain technology continues to revolutionize various industries, web3 gaming has gained significant attention from venture capital firms, with millions of dollars being poured into this emerging sector. This article explores the recent funding rounds for web3 gaming startups and their potential impact on the gaming industry.
Jungle's $6 million raise
Brazilian web3 game developer Jungle recently raised $6 million for a mobile first-person shooting game, as it joined a litany of other startups that also raised millions to launch their blockchain gaming product.
First-person shooting games have always been popular and titles such as Call of Duty have gained traction across multiple consoles and even mobile alike.
What stuck out about Jungle was how little information was available outside of their venture and angel backers. There was no demo for the product or links to any previous releases on their website, just a lot of different variations of the words “coming soon.”
This means that the $6 million invested all came from people who had high conviction in this early-stage startup to succeed and gain traction, while seeing a massive upside in the blockchain gaming market.
Whether they are right or wrong in the end is only something that time can tell, but it does show a continuing pattern of investment in blockchain gaming products.
Recent web3 gaming funding rounds
In February and March alone we saw decentralized web3 gaming platform Ajuna raise $5 million, collectible web3 character game Mino raise $15 million, and Azra games raise $10 million from a16z to release games that involve NFTs.
Gaming studios have been able to raise significant capital as well, with prominent web3 guild Yield Guild Games raising $75 million to launch a venture fund focused on blockchain gaming and India-based web3 gaming studio Kratos, raising $20 million at a $150 million valuation.
Even sports enthusiasts can now look forward to a new football-branded web3 game called Matchday that is backed by Lionel Messi and raised $21 million for its new product.
Impact on the gaming industry
Previously, I wrote that one of the reasons that blockchain gaming had a giant chasm to cross relative to what is already out there was the lack of funding they had received. It appears that a future where games are on-chain has a chance to become something more than theoretical, as blockchain-focused gaming studios are now raising enough capital to compete in an extremely competitive space. Perhaps their success will cause legacy game-makers to take notice and consider incorporating player-friendly web3 elements into their games as well.
Web3 gaming startups raised 4.49 billion dollars in funds during 2022, and with no sign of things slowing down in 2023, it is clear that momentum is building. The whole gaming industry is valued north of 200 billion dollars, and with blockchain gaming developers now having access to the time and significant resources, web3 is posturing itself to eat a bigger piece of the pie.
The rise of web3 gaming is not only being fueled by increased funding, but also by advancements in blockchain technology itself. With the development of more efficient and scalable blockchain protocols, web3 gaming startups are now able to offer gamers a more seamless and immersive experience on the blockchain, attracting a wider audience and expanding the market beyond just crypto enthusiasts.
As more traditional game-makers take notice of the success of blockchain-focused gaming studios, it may lead to increased adoption of player-friendly web3 elements in their games as well. The future of gaming on the blockchain looks promising, and the momentum is only expected to continue in the coming years.