Investing in Blockchain & Cryptocurrency Gaming

Gamemasterventures
2 min readDec 12, 2023

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Investing in the gaming sector, especially in blockchain and cryptocurrency-related gaming projects, can be a lucrative but complex endeavor. Here are some key factors to consider when evaluating potential gaming investments:

Newly Launched Projects:

Projects that haven’t been through a bull cycle yet can offer unique opportunities. These are often in their early stages, meaning their market value has not yet been fully realized or tested in various market conditions. Investing in such projects can offer higher growth potential but also comes with higher risk. It’s crucial to research the project’s development team, roadmap, and community support to gauge its long-term viability.

Appeal to a Broad Audience:

The game’s ability to attract not only cryptocurrency enthusiasts but also mainstream gamers (often referred to as “normies”) is critical. Games that cater solely to ‘Sybil farmers’ — users primarily interested in exploiting the game’s economic system — may not have a sustainable player base. A successful gaming project should offer engaging gameplay, compelling storylines, and user-friendly interfaces that appeal to a wider audience, thereby ensuring a more robust and long-lasting community.

Active User Base:

The presence of an active and engaged user base is a vital indicator of a game’s health and potential for growth. A strong community of players who are genuinely interested in playing the game, rather than just speculating on its in-game assets, suggests a sustainable ecosystem. This can often be gauged through social media engagement, active online forums, and consistent player count statistics.

Market Cap to Daily Volume Ratio:

Analyzing the market capitalization to daily trading volume ratio can provide insights into the asset’s liquidity and potential undervaluation. For instance, if a game’s associated cryptocurrency has a market cap of $10 million but is experiencing $1 million in daily trading volume, it may indicate that the asset is undervalued. This high volume relative to market cap suggests strong investor interest and potential for price growth. However, it’s important to combine this analysis with other factors, as high volume can also be indicative of high volatility.

Total Supply Distribution:

Understanding the distribution of the total supply of the game’s tokens is essential. Games where a large portion of the total token supply has already been distributed tend to have fewer risks associated with massive unlocks that can dilute the token value. It’s important to research how the remaining supply will be released, as well as any plans for buybacks or burns, which can affect the token’s scarcity and value.

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