While Web3 and blockchain gaming present exciting new avenues for developers and gamers alike, there’s still considerable friction when jumping into many of these titles, it’s not usually a case of download and start playing. Web3 gaming platform LootRush aims to change this, recently securing a $12 million seed round to build out this vision.
The round was led by crypto firm Paradigm, with participation from Andreessen Horowitz (a16z) and support from Y Combinator, and Brex founders. Angel investors involved in the round included the founders of Axie Infinity, Plaid, Wildlife Studios, Dapper Labs, The Chainsmokers, and Vivi Nevo.
LootRush was founded only last year based on the idea of making Web3 gaming as easy to use as mobile or playing a videogame on Steam. “Playing a game on Steam is as easy as installing the Steam client, buying the game you want and then downloading it to play. Usually, within a few clicks, you are enjoying the latest and greatest PC video game,” LootRush explains. “But, to play videogames using web 3 technologies, players experience a high barrier of entry. And, as interest in these types of video games continue to skyrocket, players are looking for ways to go from intent to enjoyment in as little time, with as little cost, as possible.”
So how does LootRush speed up and simplify Web3 gaming? “We believe that it should be easy, natural and inexpensive to try out games and NFTs based on lending at first. We will enable gamers to own NFTs and we help NFT owners find great players.” So after you’ve signed up for the platform you pick which game you want to play and select which NFTs to use from a curated list. “We enable players to play video games with NFTs at 100x lower price, providing more flexibility and a larger portfolio of NFTs to have fun.”
Currently, LootRush doesn’t have a massive selection of titles to choose from. At the time of writing only Axie Infinity seems to be playable – and that’s had a rough ride of late – with plenty of others listed but unavailable. The seed round should eventually help with that.
LootRush is still building up towards an official launch with no indication when this might take place. For continued updates on the latest in Web3 gaming, keep reading gmw3.
The metaverse is firing on all cylinders so far in 2022, with numerous global corporations flocking to the space. A particularly valuable part of this new emerging digital economy is none other than real estate.
Land ownership inside the metaverse is becoming exceptionally popular, with some virtual land plots selling for millions of dollars. Land plots in Axie Infinity (AXS), The Sandbox (SAND), and Decentraland (MANA) have been appreciating in value considerably over the course of 2021 and 2022.
Some organizations such as the World Economic Forum have speculated that land in the metaverse could become worthless in the future, so what virtual and what is driving high prices?
What is Virtual Land?
Virtual land is bought and traded as non-fungible tokens (NFTs). The NFT records precisely who owns the land directly on the blockchain, minting ownership for everyone to be able to verify publicly.
Each piece of virtual land within a protocol like The Sandbox is a small section of the protocol represented by the NFT. This land can then be traded or sold on secondary markets. In fact, virtual properties are highly transactable with an average of 8,000 properties changing hands every month at an average price of 3.5 ETH (~$10,000).
Virtual, purchasable land is broken down into parcels of which the number available varies between platforms. The Sandbox, for example, has just over 166,000 parcels of land presently available. Each parcel is a 96×96 meter plot.
These parcels of land can be developed to create buildings, gaming experiences, advertisements, and other use cases that mimic real-world activities.
How Land in the Metaverse is Driving Passive Income
Purchasing and building out land in the metaverse is becoming increasingly more popular. While risky, this is comparable to developers buying and developing land in places that are speculated to have substantial future growth. The metaverse is no different.
Since the onset of the real estate boom in the metaverse, properties have gone for hundreds of thousands of dollars. As of January 2022 per the Centre for Finance, Technology, and Entrepreneurship (CFTE), virtual land sales represent $100 million of the $2 billion per month spent within the NFT market.
Individuals and companies alike are investing in metaverse land – and generating income. The valuations vary depending on location and use case. There are a few different use cases that metaverse landowners can explore.
Land ownership gives the user the ability to explore multiple revenue streams, the most obvious being as a landlord that rents the land out to developers or other users. The idea of hosting digital events inside the metaverse is also an arising concept, just like the Travis Scott concert held entirely on Fortnite that saw 27 million users attend.
Summary
The metaverse real estate boom has showcased the increasing demand for both users and companies to secure their own parts of the arising metaverse space. While individual land parcels are still highly speculative in relation to their prices, the overall trend of institutional investment into metaverse real estate shows that the trend is real.
On March 29th, 2022, it was discovered that there had been a significant security breach on the Ronin network. Ronin runs the Ronin Bridge which connects major P2E title Axie Infinity to the Ethereum mainnet.
This breach resulted in the theft of 173,600 Ether and 25.5 million US Dollar Coin. At the time of the hack, this equated to over $600 million USD in value – making the Ronin Bridge hack the single largest hack in crypto history.
The Ronin network is secured by validators, a set of nodes that verify the state of the blockchain perpetually. The hacker that exploited the network was able to compromise the node keys for four different validators, giving the hacker control over the network itself.
This is essentially a form of 51% attack. A 51% attack is any network attack that is carried out by taking over 51% of the validating nodes on a network, giving the attacker control over the state of the blockchain.
The Ronin Bridge hacker utilized this concept and was able to verify the removal of over $600 million USD in ETH and USDC.
The funds themselves have largely remained undisturbed in the wallet that was originally used post-hack. A reported $7 million USD was moved through privacy tool Tornado Cash.
Market Effect and Aftermath for Axie Infinity
The cryptocurrency market largely brushed off the hack initially. Axie Infinity’s native token, AXS, did not decline in price substantially on the news. In fact, AXS actually saw a price increase prior to the latest market decline.
Axie Infinity delayed the release of Axie Infinity: Origin after the hack was discovered and has since been working diligently to restore the lost funds to the network to pay back initial users who had their money stolen.
As of April 11th, Axie Infinity appears to have successfully identified or already secured funds to replace the $600 million USD. Axie Infinity was able to raise $150 million USD through Binance and other supporting partners.
Also, Sky Mavis (the company behind the development of Axie Infinity) announced that they would be paying $450 million USD out of pocket to replace funds lost in the hack. It is unclear as to how these funds will be used to restore lost value on the Axie Infinity chain.
Decline of Axie Infinity Player Count
The largest effect that the hack has had on Axie Infinity is related directly to its overall usage. The blockchain’s average daily player count has tanked spectacularly post-hack, declining by an estimated 45%.
Of course, it has been pointed out that the daily user count on Axie Infinity has been decreasing for an extended period of time, tracing back to the December 2021 peak. Since then, millions of users have failed to interact with the chain.
Summary
The Ronin Bridge hack was a big loss for the P2E and blockchain gaming sectors. Axie Infinity is a leading metaverse/gaming project, responsible for a large percentage of the sector’s overall growth.
The hack also depicts another prime example of the vulnerability that certain bridge networks have. Bridges connect blockchains together and facilitate the transfer of data and information between otherwise isolated networks.
Though bridges have a growing importance as infrastructure within the crypto-economy, major security faults have led to two of the biggest hacks ever: the Solana wormhole hack and now the Ronin bridge hack.
The first quarter of the 2022 year has served largely as a cool off following the substantial expansion the cryptocurrency market saw since 2020. Many assets, including that of Decentraland (MANA), Axie Infinity (AXS), and Sandbox (SAND), declined or consolidated for much of Q1 2022.
What hasn’t stopped since the beginning of the year is development within the metaverse space. Nearly every major play-to-earn (P2E) project has seen tremendous development, expansion, or fresh investment from both in and outside the cryptoeconomy.
Here is a wrap up of what the top three leading P2E projects did over the course of Q1 2022.
Decentraland (MANA)
The use case and ability of Decentraland has continued expanding throughout Q1 2022 with the project adding a number of new features and incentives. Decentraland’s native cryptocurrency token MANA had an overall rocky Q1 in terms of price action.
The MANA token reached an all time high of ~$5.90 USD in November 2021. Since then, MANA has declined in price over 50%. Despite the decline, MANA will begin Q2 2022 up ~175% from its price at the end of Q1 last year in 2021.
Image credit: Messari
MANA remains a top asset within the cryptoeconomy, ending Q1 2022 as the 32nd largest project by market capitalization. In addition, MANA is the leading project for both metaverse & NFT coins.
Decentraland has announced or integrated all of the following features so far in 2022:
Royalties – Decentraland kicked off the 2022 new year with a major announcement that royalty payments were going to be integrated into the protocol. This implementation into the Decentraland marketplace will allow creators to substantially increase their potential earnings, incentivizing further adoption.
My Store – Decentraland integrated a new feature to its marketplace called My Store. This upgrade allows creators to more easily manage assets, view data, and build personal branding.
Transparency OS – In February 2022, Decentraland announced the arrival of a new operating software geared towards improving community decision-making called Transparency OS.. In short, this serves to provide further transparency of data between the community and DAO.
Axie Infinity (AXS)
Following the market peak in November 2021, Axie Infinity’s had continued its decline for much of Q1 2022. Since the end of February, AXS has consolidated largely around a market capitalization of $2.8 billion USD.
AXS remains down over 50% from the all time high it hit in 2021 after the cryptocurrency market entered a consistent decline in Q4 of 2021. Despite this, Axie Infinity is up a staggering ~1,200% since the end of Q1 2022. That makes Axie Infinity one of the fastest-growing projects within the cryptoeconomy overall.
Axie Infinity has benefited tremendously from the impressive (and growing) list of partnerships they have, including all of the following partners:
Samsung
Ubisoft
HTC
Binance
The Sandbox (SAND)
As far as virtual worlds go, The Sandbox remains one of the most popular projects within the sector. Pretty consistently trailing just behind both Axie Infinity and Decentraland, The Sandbox’s native token SAND is still holding an impressive $4 billion USD market cap.
The SAND token peaked like much of the cryptocurrency market in Q4 2021, down a comparable ~50% off the token’s all time high. The expansion of SAND over the past year has also been impressive, outperforming Decentraland and rising nearly 400% since Q1 2021.
Image credit: Messari
With enthusiasm for the metaverse and Web3 growing, SAND has also minted some truly impressive partnerships. Some of the most impressive partners to join with The Sandbox include the following examples:
Snoop Dogg
Adidas
Atari
The Walking Dead
The Smurfs
Hell’s Kitchen
Snoop Dogg avatars. Image credit The SandBox
A recent Q1 2022 example is the partnership between The Sandbox and SM Brand Marketing which will be utilized to construct a Play-to-Create model. This will be centred around building within the metaverse and minting collectables like NFTs.
With a growing arsenal of opportunities for users to earn income, The Sandbox continues to see an adoption rate that rivals all other projects within the metaverse space. Address growth is continuing to increase which correlates with a higher number of daily transactions within Sandbox.
Summary
GameFi and P2E projects took a massive step forward in 2021. In spite of price action declining much of the past five months, there has been zero slow down in the development and expansion of many projects. Brands are moving into the metaverse and blockchain space with every passing week.
Outside of the big three, a watchful eye should be kept on other gaming, metaverse, and NFT projects in the sector as the sector market cap grows. Other notable projects include:
Studies have already been released in Q1 2022 that demonstrate the potential growth of the metaverse overall, with estimates suggesting that by 2026 a quarter of people will spend at least one hour within the metaverse for work, shopping, education, and so on.
JP Morgan Chase even released a detailed study on the metaverse in Q1 2022 that outlines how their organization is expecting the space to develop and expand. They even went as far to say that the metaverse will reach “$1 trillion [USD] in yearly revenues” in the coming years.
As off-chain organizations move more towards the cryptoeconomy and attempt to integrate the metaverse – like Facebook rebranding to Meta – the legitimacy of projects like Decentraland, Axie Infinity, or Sandbox should continue to grow in 2022 and seemingly beyond.
