Oct. 9 2022, Daniel
October was a markedly uninteresting month with the volume of GameFi transactions and MAU moving sideways.
Axie Infinity, the biggest title during the bull market, had its first token unlock event in October, which caused an influx of activity on Ronin and provides a case study on the effect of vesting schedules.
There were several large funding rounds, namely to Homa and Horizon Blockchain Games. October saw no breakout games, nor any large-scale collapses in the GameFi industry.
Key Findings
Overall Market
- The Fear and Greed index jumped to a high of 34
- The price of Ethereum increased from a low of $1,276 to a monthly high of $1,620.
- GameFi was not heavily impacted by these trends and remained sleepy in October.
Financing & Investment
- The amount of funding raised in the GameFi space increased 45% MoM from $0.133B to $0.193B.
- Homa received the month’s largest investment with a $100M round. The company builds tools for mobile game developers, such as an SDK for A/B testing, and has recently partnered with blockchain gaming giant Sorare to build web3 experiences.
- The month’s second largest funding round was closed by Horizon Blockchain Games, which has a web3 developer platform, NFT marketplace, and its own flagship game, Skyweaver.
GameFi Volume & Users
- Total volume in GameFi remained steady from September, except for a brief jump in volume on the 11th.
- Almost all the new volume happened on Ronin/Axie Infinity.
- The cause for the jump in volume was the first unlocking of AXS tokens for the game’s investors and team.
Projects & Users Overview
- MAU stayed the same as September while the number of new users declined slightly.
- The breakdown of the number of unique users by chain also remained nearly identical to September, indicating no exciting title releases, nor any collapses.
- BNB had a slight increase in the percentage of new users, from 8% in September to 13% in October at the expense of Polygon — likely due to the hype around Polygon’s Arc8 dying down.
- The sharp increase in volume on Ronin was driven by a token unlock event on Axie Infinity, which unlocked 8% of the token’s total supply, driving investors to move their tokens onto exchanges and cash out en masse.
- The token’s price dropped 22% in the preceding week in anticipation of the Oct. 26 event.
- Splinterlands and Alien Worlds continue to be the two most-played games in GameFi, with Alien Worlds overtaking Splinterlands for active users.
Crypto Macro Overview
The price of Ethereum and the F&G index moved sideways in October, making for a relatively uninteresting month. However, with both upwards and downwards swings becoming increasingly muted, it could indicate that the market has bottomed out, being unresponsive to macro events.
Investment activity still plodding
There were only 9 GameFi funding rounds in October, although several were relatively large, with one nine-figure round.
This decline in funding is not specific to GameFi, with funding across the blockchain industry continuing to decline.
Ronin gets the most volume as Axie tokens unlock
Early investors in Axie Infinity were able to unlock their vested tokens on October 26, turning 8% of the total supply of AXS liquid.
In anticipation of the event, the price of AXS dropped by 22%.
Summary
A relatively uneventful month in GameFi and crypto, October saw the market continuing to move sideways. Conversely, the lack of strong movement neither up nor down may be a bottom signal.
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