Since the bear market in 2022, Web3 gaming has struggled with sustainability in player engagement, inadequate funding models, and competition from technologies like AI-driven dApps. Addressing these challenges by 2025 is crucial for the industry's future. Industry leaders emphasize a need for a mindset change among project builders, focusing on the game itself rather than just blockchain technology. Recent rankings from DappRadar highlight the most popular blockchain games, with titles like Befriend AI by Xterio and OasChoice gaining traction. Despite ongoing innovation, issues such as onboarding difficulties, poor user experience, and competition from AI remain significant obstacles. A 2024 Blockchain Game Alliance (BGA) report revealed that 53. 9% of respondents cited onboarding and UX as top challenges for the third year running. Sam Patton, COO of Drift Zone, insists that developers must prioritize fun in gaming rather than just blockchain features, aiming for an experience similar to traditional gaming. Traditional gaming studios have an advantage with established user engagement strategies, while blockchain gaming's complexities—such as managing cryptocurrency wallets and tokens—can deter new players. The BGA report noted that 36. 3% of respondents now see ease of use as crucial for growth. Some developers use social media to improve engagement, showing how community involvement keeps players interested. To enhance accessibility, experts urge creating user-friendly interfaces and simplifying wallet creation. New strategies, like free-to-play models and gasless transactions, can also smooth the onboarding process.

Some envision a future where players can dive into games without wallet or transaction worries. While blockchain gaming faces challenges, the rise of AI-driven dApps—accounting for 28% of industry activity—poses additional competition, overshadowing blockchain gaming's 25% share. Nonetheless, some view AI as a tool for improvement rather than a threat. AI can enhance onboarding experiences through interactive tutorials and personalized guidance, helping users navigate Web3 games. Developers are encouraged to combine AI with other emerging technologies like AR and VR to create immersive experiences. The integration of these advances offers new opportunities for dynamic and personalized gameplay. The funding landscape for blockchain gaming has shifted, particularly after a decline in traditional investments during the bear market, though there was a brief surge to $1. 1 billion in Q2 2024. However, investments plummeted to $110 million in the next quarter, requiring developers to adopt more strategic approaches in both development and fundraising. Industry leaders suggest that the current funding climate offers a chance for projects with clear value to flourish. Developing sustainable revenue models rather than relying solely on token price benefits will be vital. Exploration of alternative funding sources, such as crowdfunding and partnerships, is encouraged to help developers continue innovating and meeting evolving market demands.