Securities.io is committed to rigorous editorial standards. We may receive compensation when you click on links to products we review. Please view our affiliate disclosure. Trading involves risk which may result in the loss of capital.
Table Of Contents
The cryptocurrency industry has been dealing with a strong bear market since November 2021. That was the start of yet another crypto winter that has been around for about nine months now, and during this time, researchers have managed to observe the interesting behavior of different sectors of the crypto industry.
For example, it was concluded that the bear market is beneficial in some regards, as it weeds out unnecessary and weak projects while allowing legitimate ones to stand out. Of course, at the same time, it also negatively impacts investors and their portfolios, although only for a time. Eventually, long-term investors recover from losses and even make profits if their projects of choice manage to survive the bearish wave.
Resisting the bears
The conclusion that games and metaverses have been handling the bear market the best was mentioned in a recent report published by DappRadar. According to the report, blockchain games did not only manage to sidestep the ensuing bear market, but they even managed to ramp up their count by 9.51% in Q2 2022 alone. During Q1 and Q2 of this year, over $2.5 billion was invested in these sectors.
The industry has struggled the most in June, and even the blockchain gaming sector only saw around $500 million in investments. But, even so, the sector is extremely promising, and DappRadar’s CEO, Skirmantas Januskas, voiced his company’s opinion that blockchain gaming will be the key sector in years to come.
In fact, the sector is expected to bring at least 100 million new users to crypto/blockchain as it connects DeFi and NFTs. With a combination of gaming, NFTs, and DeFi, something new and exciting is expected to emerge.
How did the bear market affect the crypto industry?
So far, the bearish market has caused all cryptocurrencies to experience severe price drops. Not only that but there was a 7% decline in wallet activity compared to Q1 of this year. The amount of activity with dApps has remained relatively unchanged, but the amount of gaming-associated NFT transactions has dropped by 51% since the first quarter. The sales volume, however, dropped by 82%.
Despite this, the total number of transactions associated with the gaming sector managed to stay above 24 million per day, which is much higher than any other sector, including gambling, DeFi, marketplaces, and even exchanges.
Solana has been the most successful at attracting new game and NFT developers, likely thanks to the low cost of transactions and high processing speeds. In fact, despite several network outages that it experienced, its blockchain activity skyrocketed by 311%. It is believed that the project’s gaming community is responsible for this increase in activity.
Significant traction was also noticed with a project called WAX, with its blockchain activity increasing by around 6% since May 2022.
To learn more visit our investing in DappRadar guide.
Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.