Is GameFi just a "hype" or is it the future of gaming?

As I mentioned in the title, do you think GameFi's are a hype that has been going on for the last 2 months or is it a technology that games will evolve to in the future? Let's analyse this.

I think everyone here knows what a big hype NFTs were about 2 years ago. In the 9-month period between September 2021 and June 2022, NFTs were breaking record after record in daily, weekly and monthly volumes. It was even making news in the review columns of very famous newspapers.

In the graph below, you can see the monthly volume of Opensea purchased from the dune site until today.

Then, as we all know, big news such as the collapse of Luna and the bankruptcy of FTX shook the cryptopara market, and the cryptopara markets were suddenly pulled below $ 30k. NFTs were affected by this process and the lack of volume in NFTs continued until today. Until a meta game changer called "GameFi" changed the game!

GameFi and NFT relationship

I believe that games will play the biggest role in the mass acceptance of NFTs. In other words, NFTs will be legalised in the eyes of the people with the NFT integration into web2 games and the release of quality/playable web3 games. I can hear some of you asking why games need NFTs.

Because now "gamers" want to own more of the game they play. Blockchain gave us another definition of decentralisation and showed us that it can be achieved to a certain extent. The games currently played have a very "centralised" structure. Can you imagine what would change if a game was running on Blockchain infrastructure and the assets or items for the game were NFTs?


For example, if all the items in a game were NFTs, we could take them out of the game and sell them in a secondary market. Also, if we wanted to give them to another account or another player, we could do it securely and transparently. Thus, we could both convert our items into real money and trade them securely. It is also possible for many of the games to communicate through the same blockchain infrastructure. So what does it mean for these games to communicate?

NFTs are currently commonly produced in the ERC-721 and ERC-1155 standard. However, developers are working on new protocols and standards that allow "dynamic NFTs". To give an example from a game, imagine you have a valuable weapon item in World of Warcraft. If this item has a dynamic NFT standard, you can either sell it on a secondary market outside the game and convert it into real money, or transfer it to another game that uses the same blockchain infrastructure and use it as a corresponding asset in that game.

In short, a valuable weapon in World of Warcraft can turn into a very valuable car in a car racing game that uses the same blockchain infrastructure. In this way, you can communicate between games and secure trade becomes possible. I think this is the future of gaming.

What Do Games Mean for the Entertainment Industry?

According to Newzoo's October 2023 Report, the total number of people playing games has reached 3.5 billion. So it wouldn't be wrong to say that one in every two people in the world plays games. By 2026, this number is estimated to approach 4 billion.


Moreover, according to Newzoo's "Global Games Market Report", we can easily see that the most collaborated sector is "Games" You can easily see the "collabrated" share of other entertainment sectors in the market.


Let's come to the most important statistic: What is the share of the gaming industry in other entertainment sectors in terms of annual revenue? According to current data in 2023, the annual market value of the Gaming industry is 224.3 Billion Dollars. This makes the gaming industry first among all entertainment industries with a 55.3% market share.

According to Statista's 2021 Report, the size of the Gaming Industry is larger than the Music and Movie Industries combined. We can foresee this gap widening much more in 2024.

Result

The gaming industry continues to develop and grow in terms of annual revenue. The number of users and interest in games is increasing day by day. With this data, the innovations that blockchain technologies, especially NFTs, will bring to Games are many.

As a result, I personally see the GameFi phenomenon as "the future of gaming", not a "hype". Blockchain is a very new field that is still developing. There are a lot of opportunities here. You can follow my blog to follow these opportunities.

In the next article, we will explore potential GameFi projects and the profits to be made from them. Stay with blockchain.