Deep Dive: Solana Gaming - July 2024

Note: Below is the text-accessible version of this post for visually impaired readers.

The Solana Gaming ecosystem is quickly expanding.

Monthly active players are down drastically since peak STEPN mania in May 2022.

New player growth has slowed significantly. In 1H 2022, new players outnumbered existing ones, marking a unique period of growth for Solana Gaming. Since then, new player counts have declined in alignment with the Gaming sector decline.

Player retention was strong during the last cycle, but tapered into the bear market. Some dedicated players - at least 10% - have continued to engage with their respective games despite the downturn in the market cycle. Due to wallet cycling, these figures are a lower-bound in retention rates.

Gaming FDV has plunged 95% since its peak. In mid-2022, the gaming sector's total Fully Diluted Valuation (FDV) peaked at almost $25B. Now, it stands at around $1.3B, marking a 95% decline.

Gaming led DeFi for the past two years. Today, DeFi is 10x larger than Gaming. Gaming has declined this year while DeFi has skyrocketed.

SOL has outperformed Gaming tokens 50:1 since May 2022. In 2022, the ratio of the fully diluted value (FDV) of Gaming tokens to SOL was 0.5. By July 2024, this figure has dropped to 0.01.

Trading activity in Gaming tokens has virtually disappeared. In 2022, Gaming tokens accounted for 12% of Solana's total DEX volume. By July 2024, this figure has fallen dramatically to just 0.1%.

Part I: STEPN - Solana's Most Popular Move-to-Earn (M2E) Game

Earn tokens by walking, jogging or running with STEPN. To participate, users must acquire NFT sneakers - available for purchase, sale, or rent on the app’s marketplace.

STEPN is the most played game on Solana. Even after a drastic decline, STEPN's monthly depositors still represent a meaningful player base. Players deposit GMT and GST to engage with STEPN’s move-to-earn model, earning rewards through physical activity.

Part II: Star Atlas - The First Space Strategy & Unreal Engine 5 Game on Solana

Set in the year 2620, Star Atlas offers a vast, interactive universe for exploration, resource mining, and combat. The game is being developed in stages, enabling players to engage with various mini-games as the full experience continues to evolve.

About 76% of Star Atlas' players today were onboarded in 2021 and 2022. This activity is a mix of staking and gameplay. The majority of players are primarily engaging in staking and refilling ships in an effort to collect rewards.

The SAGE Starbased launch was unable to reverse Star Atlas' decline in active players. SAGE (Star Atlas: Golden Age) is a mini-game of Star Atlas designed to engage the community while the main game continues to develop.

Star Atlas has seen a decline in SAGE rewards since March 2024. Players earn ATLAS as rewards, and the price drop has led to lower returns. This reduction in potential earnings, alongside Solana's transaction fees, has particularly affected smaller players, diminishing their net returns from the game.

Despite a decline in player count, Star Atlas still accounts for nearly 3% of Solana's transactions. With the game fully integrated on-chain, every in-game action, from gameplay to governance participation, is recorded on Solana.

Part III: Photo Finish Live - The World's Most Realistic Virtual Horse Racing Game

Built on Solana, Photo Finish Live offers an authentic and immersive experience where players can own, race, breed, and trade digital race horses.

Photo Finish Live's monthly players have grown 43x since its launch month. The game’s vibrant social media pages and community have driven significant growth in its player base.

Photo Finish Live deposits have stabilized in the $40M range. USDC and CROWN deposits serve different purposes. USDC deposits convert to DERBY for paying entry fees, buying, and breeding horses. CROWN deposits let users stake CROWN on race tracks, earning 20% of the track's entry fees.

Despite more Photo Finish Live horse races YTD, collected entry fees decreased in Q2. This suggests that races are not reaching full capacity.

Part IV: The Backwoods - The Solana Gaming x NFT Latest Hit

This survival game allows players to take on the roles of heroes that can be powered up by owning an NFT. To win, heroes must navigate through 30 waves of monsters.

The Backwoods has attracted 311k+ players just 2 months into its Open Alpha. To ensure a high-quality player base, users are required to connect their Discord and Twitter accounts.

The Backwoods NFTs sold out within hours on May 16th. As one of the top Solana collections, all 6,666 NFTs were fully minted by the third hour on Tensor. The minting process was in three phases: Whitelisted Genesis Users, Tensorians NFT holders, and the General Public.

Spirit Race NFTs are the most coveted and command the highest prices. Backwoods NFTs feature nine unique hero races, each offering exclusive in-game abilities. In mid-June, Spirit NFTs hit a floor price of $1.2k due to their rarity and unmatched in-game superpowers.

Part V: Projects to Watch & Notable Developments

Projects to Watch:

MagicBlock: Build Unstoppable Games - High-performance engine that empowers Solana developers to build persistent and composable fully on-chain games

Nyan Heroes: Battle-Ready Cats in Mechs - A fast-paced shooter experience with cats piloting mechs, navigating through competitive battlegrounds with a variety of weapons

Bladerite: World's First Web3 Melee Battle Royale Game - A battle royale game where players master swords, knives, and bows to be the last one standing

Colony: AI-Driven Game by Parallel Studios - A survival simulation game where players engage with autonomous agents that independently evolve and make decisions

LOWLIFE FORMS™: Epic Crime Meets Sci-Fi RPG Shooter - A Web3 shooter game designed to be evolutive and modular, changing over time with new episodes, game modes and animations

Notable July Developments:

Star Atlas Fleet Command: Star Atlas' anticipated 3D SAGE update, Fleet Command, is now available for private access. Players can now fly high-fidelity ships, participate in time trials, and practice third-person shooting against bots.

STEPN GO: FindSatoshi Lab (FSL), the creator of the original STEPN app, is launching a new game. Currently in alpha testing, this game builds on the foundation of the original STEPN, adding new features and enhancements.