Web3 gaming exploded in 2024, with unique active wallets jumping 45% compared to the previous year and over $2 billion in total value locked . When I started building in this space three years ago, I couldn’t have predicted this meteoric rise or the $1.1 billion in venture capital that poured into the sector in Q2 2024 alone .

Throughout my journey developing Web3 games, I’ve witnessed firsthand how the web3 gaming infrastructure has evolved, despite still being in its early stages. The market is projected to reach USD 118.36 billion by 2034 , making this an exciting time to be in the space. However, building successful games required navigating numerous challenges and misconceptions about what is web3 gaming. In fact, while top platforms now attract 5 million monthly active users , creating games that people actually want to play remains the biggest hurdle for web3 gaming companies.

In this article, I’ll share the critical lessons learned from my three years in the trenches, the strategies that actually worked for us, and my perspective on the future of web3 gaming as mobile platforms democratize access and bring in over 300 million players .

The Web3 Gaming Landscape When I Started

The Web3 Gaming Landscape When I Started

Three years ago, the Web3 gaming ecosystem was fundamentally different from what we see today. Initially, the space was characterized by experimentation, high transaction costs, and ambitious but often flawed early attempts at blockchain-based games.

Early platforms and tools I used

When I first dove into Web3 development, CryptoKitties was already making waves as the breakout hit that had caused significant congestion on the Ethereum network back in 2017. Games like Axie Infinity were popularizing the play-to-earn model, while platforms such as Decentraland and The Sandbox were driving a virtual land rush with plots selling for tens of thousands of dollars.

My journey began with experimenting on Ethereum, but I quickly encountered the prohibitive gas fees that made many early games practically unplayable. Subsequently, I shifted to layer-2 solutions like ImmutableX, which was specifically designed to make blockchain gaming scalable and affordable. Gods Unchained became my reference point – a trading card game that allowed players to truly own their cards as NFTs.

Initial misconceptions about what is Web3 gaming

Looking back, I had several misconceptions that needed correction through experience. Primarily, I believed that storing extensive game data directly on the blockchain was essential for “true” Web3 games. Over time, I realized that blockchains should be leveraged mainly for asset ownership, security, and anti-corruption, rather than for all game operations.

Furthermore, I had originally thought that blockchain’s transparency automatically created player trust, but I learned that developers still needed to earn community confidence through consistent delivery and honest communication. Another misconception was that Web3 games were all about earning rather than enjoyment – this “crypto-first, gameplay-second” approach explains why over 75% of blockchain games launched between 2018 and 2023 eventually failed ^[1].

Why I chose to build in this space

Despite these challenges, I was drawn to Web3 gaming because of its revolutionary potential. The concept of true digital ownership fascinated me – allowing players to genuinely own, trade, and potentially monetize their in-game achievements and items.

The market opportunity was equally compelling. Traditional gaming was already generating USD 200 billion annually ^[2], with projections suggesting the Web3 gaming segment would grow from USD 4.60 billion in 2022 to USD 65.70 billion by 2027 ^[3].

More importantly, I saw Web3 as the first technology that could truly align the incentives between players and publishers. Instead of extracting value at players’ expense, developers could create sustainable economies where everyone benefits from the game’s success – essentially transforming gaming from a one-sided transaction into a collaborative ecosystem.

Hard Lessons from Building Web3 Games

1. UX friction is a real adoption killer

First and foremost, the onboarding experience can make or break your game. Early web3 games required players to navigate complex wallet setups, manage seed phrases, and pay gas fees before even starting to play. Imagine paying $50 in transaction fees for game assets valued at just $15 ^[4]. This friction created immediate barriers to adoption.

Traditional gamers expect seamless experiences, not crypto jargon and multi-step processes. The data shows games requiring explicit blockchain knowledge plateau at just 10,000-30,000 users ^[5], whereas games that hide blockchain complexity see significantly higher adoption rates.

2. Tokenomics can make or break your game

Unfortunately, many projects I witnessed struggled with unsustainable tokenomics, leading to rapid inflation and economic instability ^[4]. These models typically depended on a constant inflow of new players, artificially propping up token values ^[6].

In my experience, launching tokens prematurely created additional pressure. Once a token is in the market, stakeholders expect rapid progress and returns, often much sooner than what’s feasible in game development ^[7]. Additionally, games focusing on earnings rather than enjoyment saw their economies collapse when player interest waned.

3. Community is more important than marketing

Building a vibrant, engaged community of true players proved far more valuable than marketing hype. As a result, developers who focused on rapid user acquisition tactics without fostering a supportive ecosystem often ended up with a transient player base ^[8].

Gaming DAOs have emerged as vehicles driving the next generation of gaming communities, breaking down the wall between studios and gamers ^[9]. Moreover, these communities become self-policing to an extent, helping maintain a positive environment ^[10].

4. Web3 gaming infrastructure is still evolving

Current blockchain networks can struggle with high transaction volumes, leading to latency and increased costs ^[11]. Integrating on-chain elements extends development timelines significantly beyond the already substantial 3-5 years for traditional games ^[6].

Fortunately, solutions are emerging. Account abstraction helps deliver web2-like user experiences while offering developers greater flexibility ^[12]. Without a doubt, the infrastructure is improving rapidly, with scalable solutions addressing many early limitations.

What Actually Worked for Us

After facing numerous challenges, we discovered several strategies that led to genuine success in the web3 gaming space.

1. Using hybrid Web2-Web3 onboarding

The breakthrough came when we adopted a hybrid approach that blends traditional gameplay with optional blockchain features. This strategy allows players to enjoy the core game without needing crypto knowledge, while offering blockchain benefits for those interested ^[13]. By making Web3 elements entirely optional, we eliminated the adoption barrier that plagued earlier games.

Our most successful implementation involved creating automatic wallets for new players, converting their fiat currency into crypto behind the scenes. Furthermore, we followed the model of games like NFL Rivals, which processed over USD 650 million in transactions across a community exceeding 7 million players ^[13].

2. Partnering with top Web3 gaming platforms

Strategic alliances proved invaluable for our growth. Throughout our journey, we learned that games building on major platforms like Immutable and Polygon received nearly USD 2 billion in investor funding in 2022 alone ^[14]. These partnerships provided access to essential infrastructure and larger player communities.

Notably, listing our games on mainstream stores like Epic Games Store (which allows blockchain features) dramatically increased our reach ^[13]. Meanwhile, Steam’s prohibition of blockchain elements forced us to create specialized versions for different platforms.

3. Focusing on fun before crypto

Perhaps the most crucial lesson was prioritizing gameplay over tokenomics. As one industry leader plainly stated, “Games should be fun first, with the monetization layer as an add-on” ^[15]. This approach aligns with player expectations – they want entertainment first, with economic benefits as a secondary consideration.

By developing games worthy of playing purely for enjoyment and then thoughtfully integrating blockchain elements, we created experiences that attracted both traditional gamers and crypto enthusiasts ^[16]. This philosophy helped us avoid the pitfalls of earlier “play-to-earn” models that collapsed when player interest waned.

4. Leveraging analytics to understand player behavior

Real-time data became our compass for making informed decisions. Modern analytics platforms allowed us to unify in-game, on-chain, and social data for actionable insights ^[17]. Through careful monitoring of player behavior, retention metrics, and economic indicators, we could identify friction points and optimize the user experience.

These analytics revealed which game features drove engagement versus those causing frustration, enabling data-driven improvements rather than guesswork ^[17]. Even small tweaks based on this intelligence significantly improved retention and profitability.

5. Building with scalability in mind

Finally, designing for future growth prevented many technical limitations. We learned that web3 games need infrastructure capable of handling increasing transaction volumes without compromising speed or security ^[18].

By implementing Layer 2 solutions and selecting gaming-focused blockchains, we achieved transaction speeds up to 9,000 per second ^[19], ensuring smooth gameplay even during peak periods. The ultimate validation came when we realized that “the bigger it gets, the bigger it can get” – our infrastructure scaled proportionally with user growth ^[18].

Where Web3 Gaming is Headed Next

_{Image Source: SoluLab}

My three-year journey building Web3 games has been filled with challenges, surprises, and valuable insights. The landscape has transformed dramatically since I first entered this space, with the sector now attracting billions in investments and millions of active users. Though Web3 gaming still faces significant hurdles, the progress made in just a few years suggests an incredibly promising future.

After navigating numerous pitfalls, I’ve learned that successful Web3 games must prioritize enjoyment over earnings. Games focusing solely on tokenomics ultimately collapse when player interest wanes. Similarly, forcing players to understand blockchain technology creates unnecessary barriers to adoption. Instead, hybrid approaches that seamlessly blend traditional gaming experiences with optional blockchain elements have proven most effective.

Building robust communities rather than chasing marketing hype has likewise been crucial to our success. These engaged player bases provide valuable feedback, create self-sustaining economies, and help maintain positive gaming environments. Additionally, data-driven decision making through unified analytics has allowed us to optimize the player experience based on actual behavior rather than assumptions.

The Web3 gaming infrastructure continues to evolve rapidly. Account abstraction, Layer 2 solutions, and gaming-focused blockchains now address many early limitations that plagued the industry. Nevertheless, developers entering this space should prepare for extended development timelines and technical challenges beyond those faced in traditional game development.

Looking ahead, I remain convinced that Web3 represents a fundamental shift in gaming—one that aligns incentives between players and developers while enabling true digital ownership. The most successful projects will be those that deliver compelling experiences first, with blockchain serving as an enhancement rather than the main attraction. Web3 gaming may still be in its early stages, but its potential to transform how we play, create, and connect through games remains undeniable.

Throughout these years building in the Web3 gaming space, one truth stands clear—this industry represents far more than just a technological shift. The integration of blockchain with gaming fundamentally realigns incentives between developers and players, creating an ecosystem where collaboration trumps exploitation.

As I reflect on this journey, I’m struck by how rapidly the landscape has matured. Web3 gaming has evolved from clunky interfaces and unsustainable economics into increasingly polished experiences that prioritize enjoyment first. Yet we’re still witnessing just the earliest chapters of this transformation.

The road ahead contains both immense promise and genuine challenges. Interoperability remains a crucial frontier—enabling players to truly own assets across gaming ecosystems rather than within isolated experiences. Innovative governance models will continue emerging, giving communities unprecedented input into the games they love.

For developers contemplating this space, I offer this advice: focus relentlessly on creating games people genuinely want to play, view blockchain as an enhancement rather than a central feature, and build sustainable economies that benefit all participants over the long term.

The future belongs to creators who understand that Web3’s true power isn’t about speculative assets or quick profits—it’s about forging deeper connections between players, creators, and the virtual worlds they inhabit together. That vision, coupled with improving technology and growing adoption, makes me profoundly optimistic about where Web3 gaming is headed next.

Key Takeaways

After three years of building Web3 games, here are the essential insights that can guide developers and investors in this rapidly evolving space:

• Prioritize gameplay over tokenomics – Games focusing on fun first with blockchain as enhancement see higher retention than crypto-first approaches • Use hybrid Web2-Web3 onboarding – Hide blockchain complexity behind seamless experiences to eliminate adoption barriers for traditional gamers
• Build engaged communities over marketing hype – Authentic player communities provide better long-term value than rapid user acquisition tactics • Design scalable infrastructure from day one – Layer 2 solutions and gaming-focused blockchains prevent technical bottlenecks as user bases grow • Focus on true digital ownership benefits – Web3’s power lies in aligning player-developer incentives, not speculative asset trading

The Web3 gaming market is projected to reach $118 billion by 2034, but success requires treating blockchain as an invisible enhancement rather than the main attraction. Games that deliver compelling experiences first while offering optional Web3 features consistently outperform those requiring crypto knowledge upfront.

FAQs

Q1. What are the key challenges in Web3 gaming development? The main challenges include creating a seamless user experience, developing sustainable tokenomics, building engaged communities, and designing scalable infrastructure. Developers must focus on making games fun first, with blockchain elements as enhancements rather than central features.

Q2. How can Web3 games attract and retain players? Successful Web3 games use hybrid Web2-Web3 onboarding to hide blockchain complexity, prioritize gameplay over tokenomics, and focus on creating engaging experiences. Building strong communities and leveraging analytics to understand player behavior are also crucial for retention.

Q3. What are the potential benefits of Web3 gaming for players? Web3 gaming offers true digital ownership of in-game assets, the ability to earn rewards through gameplay, and increased input into game development through community governance models. It also aims to create more equitable ecosystems where players benefit from a game’s success.

Q4. How is the Web3 gaming infrastructure evolving? The infrastructure is rapidly improving with the development of Layer 2 solutions, gaming-focused blockchains, and technologies like account abstraction. These advancements are addressing early limitations in transaction speed, costs, and scalability, enabling smoother gameplay experiences.

Q5. What does the future hold for Web3 gaming? The future of Web3 gaming looks promising, with projections estimating a market size of $118 billion by 2034. Key trends include increased cross-chain interoperability, the rise of mobile-first gaming, more sophisticated DAO governance, and the integration of AI and AR technologies to enhance gameplay experiences.

References

[1] – https://www.reddit.com/r/CryptoCurrency/comments/187kehf/over_75_of_web3_games_failed_in_last_five_years/
[2] – https://www.antler.co/blog/web3gaming
[3] – https://www.immutable.com/blog/3-reasons-studios-are-adopting-web3-gaming
[4] – https://www.immutable.com/blog/the-evolution-of-web3-gaming-immutables-journey-from-etherbots-to-mainstream-adoption
[5] – https://gmgames.gg/why-every-web3-game-failed-and-whats-finally-working/
[6] – https://www.galaxy.com/insights/perspectives/the-winding-road-of-web3-gaming
[7] – https://upptic.com/is-web3-gaming-cooked-games-growth-with-upptic/
[8] – https://sequence.xyz/blog/common-mistakes-web3-game-developers
[9] – https://blocklords.com/news-updates/community-in-web3-gaming
[10] – https://tokenminds.co/blog/crypto-marketing/build-strong-web3-gaming-communities
[11] – https://www.inventivestudio.co.uk/web3-gaming-the-next-evolution-in-the-gaming-industry/
[12] – https://www.blockus.gg/blocks/account-abstraction-the-key-to-frictionless-web3-gaming
[13] – https://nftnewstoday.com/2025/05/20/what-are-hybrid-web3-games-bridging-traditional-and-blockchain-gaming
[14] – https://www.immutable.com/blog/immutable-and-polygon-labs-partner-to-create-the-new-home-for-web3-gaming
[15] – https://www.mitrade.com/insights/news/live-news/article-3-749250-20250409
[16] – https://cryptorank.io/news/feed/f23df-hybrid-web2-web3-experiences-are-boosting-the-appeal-of-blockchain-games
[17] – https://medium.com/@pixudi/data-driven-play-why-analytics-are-critical-in-web3-gaming-479e34fcdb2a
[18] – https://news.gala.com/gala-games/understanding-scalability-in-the-web3-world/
[19] – https://juicenews.io/article/web3-games-scalability/