Blockchain and Metaverse Gaming Startups On Track to Raise $12B in 2022

4 min readJul 22, 2022

UpOnly | Research #20: Investors pour in $2.5B in Q2, as adoption and interest remain steady

A major highlight for this year is the strong investor appetite for backing blockchain gaming and Metaverse-related startups. According to a new industry report, the emerging niche is on track to hit $12 billion in investment by the end of 2022, which would be nearly three times the total raised in the previous year ($4.2 billion).

Why do investors remain bullish on the prospects of blockchain games? This week’s UpOnly | Research dives into the latest funding data and key metrics that tell the story behind the growing allocation to blockchain gaming. We also review a recent survey that proves cryptocurrencies are set to play a significant role in Metaverse gaming environments.

Blockchain gaming startups land $2.5B in Q2 2022

According to a report published by industry tracker DappRadar, investors channeled $2.5 billion into blockchain gaming startups in the second quarter of 2022, equaling the amount raised in the previous quarter. The figure also means that the industry has already surpassed the entire $4.2 billion raised in 2021 by 33%. At this pace, the total investments could be north of $12 billion by the end of the year.

(Source: DappRadar)

Prominent funding deals closed in the second quarter include the $150 million raised by UK-based Metaverse technology startup Improbable and play-to-earn Axie Infinity. Metaverse land investor EveryRealm raised $60 million, while N3twork Studios and Irreverent Labs landed $46 million and $40 million, respectively.

The second quarter saw the launch of several blockchain gaming-focused funds. Andressen Horowitz revealed a $4.5 billion war chest with $600 million dedicated to gaming. Binance Labs and Immutable launched $500 million funds each, while Konvoy Ventures raised $150 million. Blockchain gaming ventures have the requisite resources to survive a prolonged bear market with these funds ready to be deployed.

Blockchain gaming increases share of global blockchain activity

Increased player engagement with play-to-earn is another strong factor driving increased capital allocation. The recent crypto market correction saw user activity in niches such as DeFi and NFTs drop by 17% and 24%, respectively. However, the blockchain gaming space capitalized on this decline to grow its share of blockchain activity by three percent, according to the earlier cited report from DappRadar.

The research finds that more than half of unique active blockchain wallets engaged in gaming-related activity, with approximately 1.1 million wallets active during the second quarter of 2022. Compared to the same timeframe in 2021, blockchain gaming activity reportedly increased by 232%, indicating sustained user interest.

The blockchain gaming space was not wholly immune to the market decline, with a 7% drop in user activity compared to the previous quarter. This relative resilience is one factor that spurs investor interest for the blockchain gaming space compared to other crypto industry verticals.

34% of gamers are keen to spend crypto in the Metaverse

The decentralized nature of cryptocurrencies makes them a viable method for payments in the emerging community-oriented Metaverse world. According to a new YouGov survey, 34% of respondents were open to using cryptocurrency to buy things in the Metaverse. These transactions include the purchase of gaming skins, unlocking new game modes, and other in-game assets.

Another notable discovery from the survey is that advertising could become big business in the Metaverse. Up to 35% of respondents admitted being comfortable with seeing ads in Metaverse environments. The number increased to 44% when respondents were presented the option to view ads in exchange for free access to games or unique in-game locations.

With the Metaverse projected to be worth $5 trillion within the next decade and the global advertising market already worth $590 billion, could Metaverse advertising be the next big thing? Brands and investors seeking exposure to digital assets might consider an allocation to Metaverse advertising with an eye on securing a first-mover advantage.

Navigate blockchain and Metaverse investments with UpOnly

Gaming has emerged as one of the most prominent use cases for blockchain, underlined by the increased share of blockchain activity linked to gaming-related transactions and the record funding milestone in 2022. UpOnly provides a comprehensive data directory that simplifies the process of tracking the most popular blockchain and Metaverse games, giving players and investors the chance to find the right opportunities and maximize return on their investments.

UpOnly’s week in review.

About UpOnly

UpOnly is a first-of-kind data directory that provides insightful and actionable data on the move-to-earn, play-to-earn, and Metaverse gaming fields. We aim to become a one-stop shop for gamers worldwide to identify the most lucrative play-to-earn opportunities and optimize their performance. Alongside our data directory, we will launch a decentralized prediction platform allowing anyone globally to bet on the outcome of play-to-earn and Metaverse gaming events.