{"id":25489,"date":"2025-07-22T16:00:00","date_gmt":"2025-07-22T13:00:00","guid":{"rendered":"https:\/\/forklog.com\/en\/insert-coin-to-continue\/"},"modified":"2025-07-22T16:00:00","modified_gmt":"2025-07-22T13:00:00","slug":"insert-coin-to-continue","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/insert-coin-to-continue\/","title":{"rendered":"Insert coin to continue"},"content":{"rendered":"

GameFi is one of the blockchain industry\u2019s most contentious arenas. From loud promises of passive income in games to widespread disappointment and the collapse of some flagship projects, the journey has been rough.<\/p>\n

By 2025 the segment has entered a new phase: shedding speculative hype, raising the quality of platforms and gameplay, and adapting to the real needs of players and investors. This ForkLog article analyses the evolution of GameFi, its key challenges and the market\u2019s prospects.<\/p>\n

What came before<\/strong><\/h2>\n

In 2020\u20132021, on the back of decentralised finance (DeFi), rudimentary gameplay introduced by projects such as CryptoKitties was augmented with a Play-to-Earn (P2E) model. It let users earn tokens for activity, attracting millions of players, particularly in countries with unstable economies.<\/p>\n

At its peak, Axie Infinity enabled players in the Philippines and Venezuela to earn more than the average wage: they bought NFT pets, fought battles and received rewards in Smooth Love Potion (SLP) tokens.<\/p>\n

Yet P2E proved economically unsustainable. After a sharp run-up in 2021, Axie Infinity suffered a steep decline: its user base shrank by almost 90% and its tokens fell in value.<\/p>\n

As noted in Nansen\u2019s 2022 study<\/a>, the model assumed a constant influx of new players, which made the system vulnerable. Broad profit-taking and cashing out into fiat added pressure on SLP, setting off a \u201cdeath spiral\u201d. As a result its price dropped by roughly 86% over the year.<\/p>\n

A similar story befell The Sandbox\u2014despite collaborations with well-known brands, the project failed to retain users. According to Messari<\/a>, on March 1st 2025 The Sandbox\u2019s market capitalisation stood at $661.7m ($1.3bn in December 2024). The SAND token slid from $0.54 to $0.27, losing more than 50% in a quarter.<\/p>\n

Most telling was Decentraland\u2014despite its hyped status, the metaverse saw activity steadily decline: in October 2022 fewer than 1,000 transactions a day were executed.<\/p>\n

Architectural choices in early GameFi projects baked in several problems:<\/p>\n

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  1. Speculative tokenomics. <\/strong>For many players and guilds, quick gains became the main motivation, prompting constant hopping between projects in search of higher yields. In such conditions token prices in many GameFi projects rose chiefly on the back of new-player inflows; in-game economies were not anchored in real utility, serving instead as fuel for short-lived manias.<\/li>\n
  2. Weak gameplay. <\/strong>Developers rushed products to market, often neglecting the core: the quality of the game itself. As a result, projects quickly lost user engagement.<\/li>\n
  3. High barriers to entry. <\/strong>Onboarding into GameFi became a quest of its own. Setting up wallets, buying tokens, using DeFi interfaces and paying fees created big hurdles for newcomers. Pay-to-Win titles\u2014where victory hinged on purchasing costly NFT assets\u2014undermined motivation for many.<\/li>\n
  4. No AAA calibre. <\/strong>\u201cTriple-A\u201d in gaming denotes big budgets, depth and polish on a par with studios such as Bethesda or Blizzard. Web3 lacks a true AAA analogue: major publishers are wary of experimental terrain, and startups lack resources for full-cycle production. That slows GameFi\u2019s path to the mainstream.<\/li>\n<\/ol>\n

    What changed<\/strong><\/h2>\n

    After the first generation of GameFi projects faltered, criticism poured in\u2014from traditional gamers and the crypto community alike. Many teams left; others stayed and began to rebuild the segment\u2019s architecture from scratch. Projects started rethinking their approach and bringing the following into production.<\/p>\n

    Sensible tokenomics. <\/strong>The original Play-to-Earn model, fixated on income, often clashed with good gameplay. It is giving way to Play-and-Earn\u2014gameplay first, income as a bonus. In successful projects such as Pixels <\/em>and Big Time, tokens serve utility roles: access to events, upgrades, and DAO votes. Rewards are capped and in-game economies are balanced.<\/p>\n

    Updated UX<\/span>. <\/strong>To tackle high fees and sluggish transactions on Ethereum, GameFi projects are moving to L2 solutions: Arbitrum, ZKsync, Starknet. That meaningfully cuts costs and brings the experience closer to Web2 norms.<\/p>\n

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    Over the past year, total value locked in Ethereum L2s reached $33.45bn. The largest platforms are Arbitrum One, Base and OP Mainnet. <\/em>Data: L2BEAT<\/a>.<\/figcaption><\/figure>\n

    Onboarding is being simplified in parallel: passwordless sign-ins, account abstraction and subscription models are emerging. Players no longer need to grapple with blockchain intricacies\u2014they can simply jump in and play.<\/p>\n

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    Analysts at Delphi Digital stress that second-layer solutions are pivotal for improving UX and lowering transaction costs. In the The Complete Guide to Rollups<\/em><\/a> they detail the advantages of ZK rollups and optimistic rollups\u2014from scalability to cost minimisation\u2014both critical for gaming dapps.<\/p>\n<\/div>\n

    Hybrid game design. <\/strong>Previously, launching a token could be enough to kick-start a project. Now the GameFi crowd competes with Web2 studios on depth of mechanics, interface usability and engagement.<\/p>\n

    Many projects are reverting to tried-and-tested monetisation: in-game purchases (skins, upgrades, characters) remain optional and do not affect balance. That enables Free-to-Play, where NFTs can be earned via in-game achievements or drops without mandatory upfront spend.<\/p>\n

    This lowers barriers for newcomers and fosters a fairer playing field. A case in point is Big Time<\/a>, where NFTs are used solely for customisation and confer no gameplay advantage.<\/p>\n

    Rise of UGC<\/span> ecosystems. <\/strong>Games built around user-generated content have become a key trend. Through DAOs and in-game editors, players create maps, modes and items that shape a project\u2019s trajectory and generate revenue.<\/p>\n

    Projects undertaking large-scale GameFi overhauls include:<\/p>\n