Crypto might appear to be in freefall right now, but blockchain gaming is dominating VC deal-making in 2022. Roblox (NASDAQ: RBLX), which launched its first blockchain-based game this year (PlayDapp), led the way with a $12.8 billion IPO. Yuga Labs, creators of the Bored Ape Yacht Club and Otherside, a P2E metaverse project, raised $450 million from twenty-five private investors.
The trend is clear to see. Gaming companies that employ play-to-earn, tokens, and/or NFTs as player incentives are resonating with investors right now. In the first quarter alone, there were $1.7 billion in private investments in the blockchain sector. The fourth quarter of 2021 was roughly the same, with most of the money raised in seed rounds for new projects.
Welcome to the metaverse. What we are witnessing right now is the first stages of a new world where people will be able to socialize, work, and play in virtual reality. Investors know that gaming companies are showing us the way there. As the S&P plummets into a bear market, it’s looking more like blockchain gaming in the metaverse could fuel the next bull market.
Sustainability with NFT Communities and Blockchain Gaming Bases
Community building is not a new concept in the technology sector. Facebook, Instagram, and Twitter are three of the more obvious success stories. Yuga Labs took it to another level after the success of the Bored Ape Yacht Club. They’ve positioned themselves as a brand name in the NFT space, parlaying their initial success into a thriving community.
Increased public exposure has been the key to growth for Yuga Labs. NFT trading platforms like OpenSea and FTX have become marketplaces where novices can gain exposure to blockchain-based products. As new projects mature, additional IPOs will provide more investment opportunities for retail traders. They’ll be looking at community metrics.
Blockchain gaming bases are growing in much the same way. Their marketplace is embedded in the games themselves. Otherside is a great example of this. You need to play to earn (P2E) NFTs and other rewards. Yuga Labs uses those rewards as incentives to get people shopping in NFT marketplaces. The social connections in the game help to spread the word.
Market analytics show that NFT transactions dropped 20% in May, but Solana reported $335 million in sales across all marketplaces, a 13% increase from the previous month. The NFT sector is not declining. It’s consolidating. We’ve seen this movie before. Remember Friendster and MySpace? Facebook beat out both by building a larger community.
Zuki Aims to Capitalize on High-Growth in Web3 & Blockchain Gaming
The term “Web3” has been bandied about quite a bit. What exactly does it mean? The blockchain game developers at Zuki, Inc. (OTC Pink: ZUKI) (formerly known as MMA Global (OTC: LUSI)) recently released a video on gaming economics where they describe Web3 as “an experience where the user has more control and owns their own data.” That’s somewhat simplistic but accurate.
Another explanation is that Web3 is a world wide web built with blockchain technology. It’s faster, more secure, and adaptable to the needs of its users. With Zuki’s new gaming app, which is coming in July, users can create games and build their following. Their ownership will inspire them to drive participation and ensure sustainability for Zuki.
Data privacy and content ownership have been dominating the headlines for several years now, so the timing for a new blockchain-based Web3 internet could not be better. Most people are aware of the problems Facebook has had in these areas, and they’re not the only ones. Giving ownership of data and content back to users is a key driver in the transition to Web3.
Blockchain Gaming Economics: How Users Can Earn in the Zukisphere
The economics of Zuki blockchain-based gaming apps are broken down in a company video titled “Ways to Win.” Watch it and you’ll understand why blockchain gaming is a preferred investment for VCs and retail investors. Blockchain games are incentivized by the creator, the platform, and the user. The following techniques help drive user participation:
- Play to Earn (P2E)
- Invite to Earn (I2E)
- Create to Earn (C2E)
- Mint to Earn (M2E)
- Stake to Earn (S2E)
With Zuki, revenues are split 50/50 between production costs and a prize pool. The game creator gets 45% of the production pool, with the other 55% split between Zuki (30%), patent royalties (20%), and affiliated marketing (5%), aka bringing on new users. 90% of the prize pool is paid out to players, with the other 10% going to 3-tiered AM payouts.
This payout structure strongly incentivizes influencers and gaming participants alike to get involved with the Zuki platform. Influencers can get paid and receive benefits from their followers playing and participating in the Zukisphere. Participants have several methods for being able to earn as well, as described above.
Zuki’s Gaming Launch, Name Change, and Q1 Financials
Zuki officially changed its name from MMA Global and its old ticker symbol “LUSI” on June 21, 2022. This is an important step for the company, as they prepare for its highly-anticipated gaming launch. Zuki now trades under the symbol “ZUKI” on OTC Markets.
Jim Phipps, CEO at Zuki, reported on June 5th that Phase 1 of their application launch will happen in July 2022, with Phase 2 following sometime in August 2022. This comes just a few short months after their Q1 financial reports showed nearly a 10% increase in total assets, quarterly revenue of $285,614, and $63,114 in cash on hand to cover current liabilities.
Like most startups, Zuki is dependent upon fundraising and debt financing to continue the development of its platform. Between stock sales, convertible debt, notes payable, and additional paid-in capital (APIC), they were able to raise $7,314,132 through financing activities in the first quarter. Labilities are also higher, but that’s to be expected at this stage.
After the launch, the company expects to derive revenue primarily from the three mobile platforms (iOS, Google Play, and Amazon) on which it will market its technology, games, and applications in the form of app store transactions and from various advertising networks in the form of branded advertising placements within its applications.
In addition to its upcoming gaming launch, Zuki recently launched its staking platform, which is now available to all ZUKI token holders at https://zuki.app. Upfront staking rewards on all programs range between 2% and 5%, depending on duration selected. The ZUKI staking platform programs offer durations from 6 months to 60 months and pay out annual rates between 6% and 16% per year.
Overall, Zuki has continued to make big strides in 2022. With the name & symbol change now effective and the staking platform in full-swing, the company is now working hard on its upcoming blockchain gaming launch. In addition, the company is waiting for the opportune moment to unveil its DEX, which is another key component to the Zukisphere. Zuki presents a potential compelling opportunity to capitalize on one of the most high-growth aspects of the entire cryptocurrency universe: blockchain gaming.
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