Big tech giants like Microsoft, Tencent, Sony, Nintendo and others joined the Web3 space in the last two years. a new report from the cryptanalysis firm Coingecko delves into the sector and the projects supported by these important companies to answer a question: how are they investing in the nascent industry?
How are Microsoft and Nintendo investing in Web3?
According to the report, Microsoft and other big tech companies employ different strategies to inject capital into the Web3 space. The data reveals that the majority of companies, or 75.9%, opted for a “measured and indirect approach.”
That way, investors can cover themselves in case of “adverse headlines” or if the project faces any particular challenges, while maintaining the benefit of backing blockchain-based companies. In other words, Nintendo and others can take advantage of the technology without exposing themselves to bad press.
Other big tech companies, such as Tencent and China-based Unity Software, are pouring money into developing the infrastructure to run blockchain-based projects. The report highlights that their efforts range from developing tools to supporting blockchain developers to develop them.
Some of the projects these companies support include WeMade, a blockchain game producer; a metaverse company called Morpheus Labs; Startale Labs, a Web3 incubator; a joint venture between Game Freak and Nintendo; and much more.
Overall, more than a dozen projects are supported in some way by some of the world’s top technology companies. The report also highlights some of the obstacles to these projects, including ambiguous regulations, developing a compelling product, and moving to widespread adoption.
Gaming sector adopts Web3
While the Web3 space has grown, the sector is still relatively small. The report shows that the total market capitalization of gaming tokens is around $5 billion, while the top 10 gaming companies launching a project in the nascent sector have a combined market capitalization of $3.219 billion. of dollars.
29 out of 40 large video game companies, or around 72% of the sector, have ventured into the Web3 space, underscoring its relevance despite the persistent downward trend in the cryptocurrency market. Take-Two Interactive, Ubisoft, Bandai, Square Enix and others are developing their blockchain game projects, as seen in the chart below.
However, only a handful of them are set to launch this year, while others will debut in 2024 and beyond. The report said:
On the other hand, adoption of blockchain technology by established video game companies has been relatively slow, attributed to concerns such as scalability, market acceptance, regulatory uncertainty, and past security breaches in previous blockchain games. .
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Cover image from Unsplash, chart from Tradingview
