Monthly comprehensive report that summarizes all major trends, developments and funding across the Metaverse, NFT and Web3 Gaming space

1. NFT Overview

January turned out to be a strong month for NFTs as the overall market rally pushed interest for NFTs. The Nansen NFT-500 index which does a broad market tracking of NFTs was up 1.5%, and the total NFT marketcap grew 6.37% to reach $22.4 Billion by the end of the month.

Trading volumes across the most popular blockchains (Ethereum, Solana, ImmutableX, Cardano, Polygon) stood at $611 Million, down 8% from the previous month. These figures, despite appearing unfavorable, are an improvement to the volumes seen in the latter half of 2022 and indicate a positive trend towards recovery. The biggest winner among the blockchain volumes was Solana, which was one of the very few chains where volumes increased MoM. Solana recorded a phenomenal jump as volumes reached $108 Million, up an incredible 48% MoM. The chain rose to prominence and accounted for 17% of NFT volumes among leading chains. These numbers are fascinating as Solana cements itself as the second best destination for NFT activity, after Ethereum.

Another big winner among the NFT markets were the NFT lending protocols. Data suggests that NFT traders are increasingly turning to collateral-based lending platforms, indicating a growing adoption rate. Out of the numerous lending protocols, BendDAO has shown one of the biggest increases in borrow volumes and TVL in January. The TVL locked on the protocol grew a phenomenal 120% in January alone, according to data from DefiLlama.

Over to the downside for January, multiple traditional brands have been entering the NFT space with disappointing reception from individuals. Porsche for example had an underwhelming mint for their 911 replicas due to reasons such as high mint price and the lack clarity over utility. On the positive light, these NFT mints from brands should give traditional teams a better understanding on how to approach NFTs in the future. In terms of funding in the NFT sector, the space continued its monthly descent to clock in the lowest funding amounts over the past 12 months, at $29.3 million. The largest funding amounts went to SYKY and Cohort, drawing in $9 million and $3.2 million, respectively.

NFT Recent Developments

  • Mastercard launches a Web3 Incubator program for artists on polygon (Article). The company aims to support artists looking to pursue opportunities in the digital economy, with participants being taught how to mint NFTs and present themselves in virtual worlds.
  • Japan issues new guidelines for NFT transaction taxations with clear regulations. In-game tokens will be taxed uniformly at the end of the year and the profit from primary and secondary NFT sales are income taxable.
  • Top Bluechip NFT collections move blockchains: Doodles announced it will launch Doodles 2 on Flow Blockchain. Pudgy penguins partnered with LayerZero to take the collection cross chain to Polygon, BNB chain and Arbitrum.
  • Big Brands and franchises release NFTs and receive mediocre response from fans: Game of Thrones sold out its Hero Boxes but receive criticism for the design aspects of the NFTs. Porsche cut its mint short after abysmal reception for its Porsche 911 digital replica NFTs
  • Sudoswap airdropped native tokens which governs the sudoAMM protocols to early liquidity providers and 0xmon NFT holders (Tweet). The NFT marketplace has been facing stagnant growth since the initial wave of interest in August last year.
  • NFTs on Instagram have been booming as multiple collections launched on the platform sells out in seconds (Article). Popular stars with the likes of Micah Johnson have successfully sold NFTs on Instagram using Polygon.
  • Tribeca Film Festival has collaborated with OKX to launch its limited release NFTs that gives holders access to visionaries and invite-only events (Announcement).
  • Avalanche-based NFT marketplace Joepegs is looking to expand to BNB chain (Article). Following the expansion, BNB users will be able to launch their NFT collection on the Joepegs NFT marketplace.

Monthly NFT Stats

NFT Project Fundraises

2. Web3 Gaming Overview

January turned out to be a stellar month for the Web3 gaming industry. The sector drew in consistent daily gamer numbers, with an average of 838,300 DAU interacting with Web3 games. January was a strong start to the year for the gaming sector as we saw a slew of announcements and plans for the year ahead.

Gala Games started the month strong by announcing the acquisition of Ember Entertainment, the developers behind the well-known Walking Dead: Empires, and its mobile focus for 2023, which saw its native token rallying. Sorare, meanwhile welcomed the English Premiere League as their next acquired league, exposing close to 4.7 Billion fans of the EPL to their digital collectibles game.

Apart from Web3 centric gaming news, we also saw multiple large announcements from the Web2 gaming scene. VooDoo, one of the largest game developers and publishers announced its intentions to launch a gaming universe and its own blockchain. Additionally we also heard rumors of Amazons plan to integrate Web3 games and NFTs into the platform, which would be massive in terms of adoption if the rumors true. These were just the bigger news of the month that sets the web3 gaming sector to a great start for 2023.

On the gaming end, the biggest game of focus in January was obviously Dookey Dash, which took the NFT and web3 gaming space by storm. Claimable to the Yuga Labs NFT holders for free, the Sewer pass acted as an access pass to the endless runner game. The game has been a major success in terms of getting users to pay to play the mini game. While the casual game had a negative view from non-holders of the pass, the game brought in over 22,000 players, which for a web3 game are considerable numbers. It remains to be seen what Yuga Labs has planned for the next few mini-games.

On the funding end, Web3 gaming sector saw an increase in funding amounts compared to the previous month. We saw an inflow of $72 million in funding across 9 rounds, a large drop from the average funding inflow of 2022. The largest funding amounts went to Champions Ascension and IntellaX, drawing in $32 million and $12 million, respectively.

Gaming Recent Developments

  • Amazon is set to launch NFT initiatives as it has been hovering at the edges of Web3 for some time (Blockworks). There is a focus on blockchain based games and NFT applications, according to sources familiar with the matter.
  • Video gaming giant, Voodoo has announced Voodoo Infinity, its new blockchain gaming ecosystem that takes gaming to the next level (Tweet). The game maker will also be launching its own cryptocurrency in 2023.
  • Mythical Games, a web3 gaming studio has released its new marketplace following the acquisition of gaming marketplace DMarket (CoinDesk). Mythical’s EVM compatible Layer 1 chain launched last month.
  • Fractal has integrated its NFT platform into Polygon and has announced its funding (GamesBeat). Fractal has started working with 30 top polygon games and has created a series of campaigns with these launch partners.
  • Treasure DAO has announced a new Game Builders Program (GBP) supported by Arbitrum that aims to support and incentivize high potential game building on the Treasure Ecosystem (Tweet)
  • Gala Games announced the replacement of Town in the flagship Town Star game with Gala, swapping at a 2:1 ratio
  • Axie Infinity officially launched Axie Origins Season 2 and has released information on the updates on the ecosystem so far, along with the launch of Mavis Hub 2.
  • Delphi Digital & Naavik have released their joint Web3 gaming report for 2023 (Link to Report)

Monthly Gaming Stats

Source: DappRadar
Source: DappRadar
Source: Footprint
Source: Footprint

Gaming Project Fundraises

3. Metaverse Overview

January turned out to be a modest month for the Metaverse markets in general. Metaverse trading volumes were moderately lower than the previous month, at $37 million, but even so, much higher than monthly volumes seen in the 2nd half of 2022. Most of these volumes were, as usual attributed to the secondary sales of the Otherside Metaverse. The virtual world comprised 93% of the sales volumes over the month, with NFT worlds and Sandbox closely competing for 2nd place.

NFT Worlds in particular had a robust month and recorded a 238% jump in metaverse trading volumes. The team has delivered consistently and the Minecraft setback has seemed to matter little to the holders. NFT Worlds announced a series of updates in early January that would take place before the launch of the client, which had created quite a positive response among the community.

In addition to the existing decentralised Metaverse realms, a new Metaverse platform, Createra, surfaced over the past month. The Metaverse is focusing on creator oriented world and creating the largest Gen Z-focused Metaverse platform. Createra released Land NFTs and announced its $10 million round last month, with the project setting its sights on empowering the creator economy through user generated content.

Over on the traditional arena, brands and organisation continued their foray into Metaverses in January. Warner Music Group, Oreo and Pedigree were some of the bigger brands to enter the Metaverse over the month. On the funding front, Metaverse Funding grew in January to draw in $34.3 million in sector inflow. The largest funding amounts went to Emperia and Createra, both raking in $10 million.

Metaverse Recent Developments

  • South Korean Woori Bank officially launches the Metaverse Banking Experience (Article). The Bank’s Metaverse will assist in banking services and also offer 3D virtual training to its employees.
  • South Korea launches a Metaverse replica of Seoul and opened the first stage of the first city-back metaverse platform in the world (Announcement). The three-part project is expected to be completed in 2026, with the aim to improve the efficiency in public administration services.
  • Oorbit, a 3D world builder has partnered with LG Electronics to ring interoperable virtual worlds to LG TV’s (Announcement). The partnership entails bringing immersive games and experiences to invteract with the Metaverse.
  • Job fair in Japan is hosted on the Metaverse with over 2,000 students in attendance (Article). Students used avatars to communicate and review job previews in booths.
  • The Dubai International Financial Center has announced the launch of its Metaverse platform (Announcement). This launch is in line and part of Dubai’s Metaverse Strategy that aims to add $4 Billion to the GDP by 2032.
  • Mckinsey has released a report that estimates the Metaverse impacts of up to $5 Trillion by 2030 (Article)

Monthly Metaverse Stats

Metaverse Project Raises

About Rising Capital

Rising Capital is a Singapore head-quartered ‘Digital Assets Management’ firm focused on early-stage blockchain investments (Rising Funds) and venture building studio (Rising Studios) in South & Southeast Asia. Since 2013, the team has built, operated and sold several crypto ventures before setting up ‘Rising’ to capture significant return asymmetries by picking and investing in brilliant founders, while keeping a majority of investments in liquid assets.

Our experience & global network allows us to be at the forefront of changing narratives in crypto such as NFT, Gaming, Metaverse, L1s and L2s, along with advancements in blockchain protocol technologies by conducting thorough research on the “next big things” while managing risk with proper licenses, audits, compliance and security management. Have an interesting idea for partnership or working on a startup?

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