With the DeFi market declining earlier this year, crypto users and investors have flocked to the GameFi to grow their portfolios. Subsequently, the number of game projects grew to 1,406 from 693, an increase of 103% YoY.
How should you evaluate a project before investing or participating? In this article, we will outline the top 5 metrics to help you understand a GameFi project’s long-term potential and apply this framework to 1 popular game.
Despite the exploding number of GameFi game projects, it’s not the case that all do well. Therefore, users should perform analysis and due diligence to screen projects before investing. Here’s what to look at:
Team Background
Financing
Project Business Model
Number of Users
Footprint Analytics – GameFi Users Overview (Latest)
Launched on Aug. 23, 2021, DeFi Kingdoms is a Harmony Chain-based metaverse project that incorporates DeFi revenue farming activities into more gamified gameplay.
Team Background
According to the official website, the breakdown is divided into 9 groups of team members, which are back-end development, front-end development, game design and lore artist, model design, community, operation, business and other functions. Since the team members are basically anonymous, it is difficult to judge their professional experience.
On the other hand, the project’s whitepaper roadmap design is very clear, divided into 6 stages. Less than 1 year after the launch, the team has developed to the fourth stage, and launched DFK Chain. DeFi Kingdoms is known for building kingdoms that include games, DEX, pop-up pools, and NFT markets. The game at one point had more trading volume than Axie Infinity.
Footprint Analytics – Top 10 Games Ranking by Volume
It can be seen that in a short period of time, the team has managed to progress development and operations as planned.
Financing
As of April 28, there is no public financing information for the project. In contrast, Axie Infinity has raised 5 rounds with a total funding of $9 million. Therefore, the DeFi Kingdoms project is slightly behind in financing.
However, on March 8, the Avalanche Foundation launched a $290 million incentive program to promote the growth of the subnetwork gaming project. And DeFi Kingdoms is the first project to receive a $15 million reward through the Multiverse program, becoming the first major multi-chain game.
Tokenomics
Many GameFi games currently have a multi-token model, although the single-token model is more convenient for players and less difficult for developers. However, multi-token mode can minimize the impact of token price fluctuation on the game in the secondary market.
DeFi Kingdoms uses a multi-token model to promote liquidity and stability of in-game funds.
DeFi Kingdoms’ tokenomics and high revenue generation attract many users to the game.
Note that since launching on Avalanche, the game also includes the $CRYSTAL token, which will function similarly to $JEWEL on that chain.
Project Business Model
The project’s business model is directly reflected in its token price and token market cap. As of April 27, DeFi Kingdom’s market cap of $241 million exceeds that of Alien Worlds, the top game on the BSC chain. The overall market cap trend of DeFi Kingdoms is highly correlated with the number of users participating in the game.
Footprint Analytics – Market Cap / Users
In terms of token price trends, there is some volatility in the $JEWEL price. As of April 27, the price is $2.86. Compared to the Splinterlands token $SPS, which currently has the largest number of users, $JEWEL has the edge.
Footprint Analytics – Token Price & Trading Volume
Although DeFi Kingdom has no VC financing, it is possible to build a platform with a market capitalization of over $241 million and a cumulative transaction volume of over $6 billion.
Number of Users
In March, DFK surpassed Axie Infinity in terms of daily active users, averaging about 20,000 users per day. Through their Tokenomics and the team’s planning and promotion of the project, DeFi Kingdom’s overall daily growth is relatively stable.
Footprint Analytics – Comparison of Users Axie Infinity and DeFi Kingdoms
From the above five dimensions, it can be seen that DeFi Kingdoms is currently in the early stage, mainly relying on LPs to motivate users or retail investors to enter the market to maintain a stable ecosystem. However, based on the fact that its team members are anonymous and have not received financing, players or investors also need to do security checks when playing to earn and investing in the market.
This piece is contributed by Footprint Analytics community.
The Footprint Community is a place where data and crypto enthusiasts worldwide help each other understand and gain insights about Web3, the metaverse, DeFi, GameFi, or any other area of the fledgling world of blockchain. Here you’ll find active, diverse voices supporting each other and driving the community forward.
Data Source: Footprint Analytics – DeFi Kingdoms Dashboard
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