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It’s safe to say that NFTs stole the show from the broader crypto market in 2021.
As non-fungibles took the market by storm a few months ago, masses of retail users and investors as well as crypto projects were joined by well-known artists, athletes, celebrities and billionaires, from Kings of Leon and Eminem, to Jack Dorsey, Paris Hilton and Lindsay Lohan.
And there is a valid reason behind this ‘NFT craze.’ As rare, irreplaceable and unique assets, non-fungible tokens can represent basically anything on the blockchain from digital art and personal data to in-game items and virtual land for which they provide full ownership to their owners.
Interestingly, even Visa’s head of crypto recently praised NFTs for their ability to “make crypto cool” and engage people outside the industry.
The rise of play-to-earn and GameFi
With the rise of NFTs, blockchain gaming has finally gained traction, introducing the consumer-friendly play-to-earn (P2E) concept instead of the super controversial play-to-win (P2W) model utilized by a great share of triple-A titles in the broader video gaming industry.
With solutions like Axie Infinity, Splinterlands and Alien Worlds becoming increasingly popular, this market sector changed drastically from its early days, when Crypto Kitties was basically the only P2E game that managed to attract a decent user base.
And blockchain gaming is what took NFTs to the next level. Instead of solely serving as the favorite assets of speculators and collectors, non-fungibles are now actively utilized by millions of players worldwide to enhance their gaming experience.
What’s even more exciting is that these two trends have led to the inception of GameFi the golden child of play-to-earn blockchain games and decentralized finance (DeFi).
As a hot market segment, GameFi offers an excellent opportunity for users to earn crypto via popular DeFi activities (e.g., yield farming, staking, lending) while enjoying immersive games. All of this is combined with NFTs, which these solutions implement to extend their ecosystem’s functionalities, create sustainable tokenomic and business models and incentivize player engagement.
For that reason, it’s not surprising to see that, while P2E assets account for $25 billion out of the $2.3 trillion crypto economy, 57% of the surveyed 197 video game developers in the US and UK are the most interested in GameFi, with 58% stating that they are beginning to utilize blockchain tech for their solutions.
The metaverse to give a boost to GameFi
With so much traction this year, I don’t expect GameFi’s growth to slow down next year. On the contrary, this trend will further accelerate due to Facebook’s rebranding to Meta and its plans to launch its own metaverse.
Simply put, a metaverse is an immersive virtual world for players to connect and do various activities together, just like in real life. However, instead of being physically present, users are connected in a digital space via technology.
Following Facebook’s Meta plans, the metaverse has become one of the hottest topics of 2021, creating so much hype that even other tech giants have announced their upcoming virtual worlds.
Due to its likely centralized architecture, Facebook’s virtual world comes into contrast with decentralized metaverses created by crypto projects, such as the Sandbox or Decentraland. Despite this fact, as the tech giant’s announcement generated extreme hype around the topic, it boosted the popularity of blockchain-based solutions in this field.
However, the hype around metaverse projects will drive many users to the broader blockchain gaming space, as well as to GameFi. As virtual worlds and play-to-earn games get more popular, these two trends together will accelerate the adoption of the GameFi sector as well.
2022 should be another great year for GameFi
Just like this year, 2022 should be exciting for the blockchain gaming and GameFi sectors.
Next year, we will see an increasing number of users, companies and well-known people joining the space, as well as more innovative and creative projects launching their own apps on the blockchain.
In the meantime, decentralized projects and tech giants like Facebook have officially started a war to conquer the metaverse space.
For that reason, we will see many initiatives and progress in this area as well in 2022. Blockchain projects will leverage the hype around virtual worlds to attract more users from the public, fine-tune their solutions and make it clear why a centralized architecture is not the optimal way to create a metaverse.
And as GameFi and play-to-earn thrive, there will be even more opportunities for users to earn coins while enjoying a unique blockchain-powered gaming experience.
Leo Cryprus is the founder of GOC.games and co-founder of Cryptus Media.
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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
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