The Grim Reality: Why Most Web3 Games Never Survive Their First Years

The Web3 gaming landscape tells a sobering story. Data pulled from blockchain analytics platform Footprint Analytics and compiled by crypto market tracker CoinGecko reveals that the vast majority of Web3 games launched over the past five years haven’t made it. Out of 2,817 GameFi projects launched between 2018 and 2023, roughly 2,127 have essentially disappeared from active use—a sobering 75%+ graveyard rate that should concern anyone eyeing the space.

The Brutal Numbers Behind Web3 Games’ Collapse

Breaking down the timeline reveals just how harsh the journey has been. When CryptoKitties sparked the initial wave of excitement in late 2017, optimism flooded the sector. The following year saw 422 new titles enter the market, but 307 quietly died by year-end—a 72.7% failure rate that foreshadowed what was coming.

The picture darkened considerably in 2019 and 2020. Only 244 new GameFi projects launched across those two years combined, yet both years saw failure rates hovering around 94%. The crypto winter was brutal, and Web3 games bore the brunt of investor pullback and declining player engagement. Year after year, the average failure rate since 2018 sits at a staggering 80.8%.

When Did Things Finally Stabilize?

The bull run of 2021 offered a brief reprieve. Failure rates dipped to 45.9%—the lowest in the entire period—with 339 projects becoming inactive. Yet this remained the smallest graveyard by far relative to activity.

Then came 2022’s reckoning. As the crypto bear market unleashed chaos across the entire ecosystem, Web3 games suffered their worst year yet. Over 740 GameFi projects failed that year—a 107.1% failure rate that reflected pure market carnage. The collapse wasn’t unique to gaming; it was systemic across crypto.

Signs of a Turning Point?

Fast forward to 2023, and the narrative began shifting. Around 509 GameFi projects became inactive that year at a 70.7% failure rate—a noticeable decline from 2022’s devastation. CoinGecko’s analysis suggests this could signal stabilization within Web3 games and the broader Web3 ecosystem. Whether this marks genuine recovery or merely exhaustion of the weakest projects remains an open question. What’s clear is that survival in Web3 games requires more than hype—it demands sustainable economics and genuine player retention mechanisms.