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![](\"https:\/\/images.cointelegraph.com\/images\/840_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMTEvNTM3ZGNjZjgtNGE0ZC00Y2NmLWE2YmYtYjJmNzA3MGIwNDE2LmpwZw==.jpg\")
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GameFi’s constantly evolving model could make \u201ctoday’s AAA game companies look like peanuts,\u201d said Jack O\u2019Holleran, CEO of Skale, a multichain Ethereum-native network that powers Web3 games. In fact, blockchain-based games and metaverse projects are showing resilience amid a winter that has dragged down many players in the crypto industry, with $1.3 billion\u00a0raised in the last quarter<\/a>, as reported by DappRadar.\u00a0<\/p>\n Finding a sustainable GameFi model, however, remains a challenge. User experience ranks amid the top struggles in the industry, mainly because of gas fees and the complexity of buying, owning and trading NFTs. \u201cCharging users fees every time they transact or trigger a smart contract creates a disincentive to play,\u201d noted O’Holleran, adding that \u201cin order to appeal to the mass market, there\u2019s a ton of work that needs to be done around usability.\u201d<\/p>\n Despite usability challenges, Web3 games accounted for nearly half of blockchain activity across 50 networks in the last quarter, according to DappRadar, with 912,000 daily Unique Active Wallets interacting with games\u2019 smart contracts in September only. <\/p>\n Most common in-game business models include play-to-earn (P2E), which allows players to earn rewards such as tokens and nonfungible tokens (NFTs)<\/a>, and play-to-own (P2O), which is a more detailed version of P2E, providing players with proof of ownership of rewards for peer-to-peer trading. A recent analysis from Absolute Reports projects massive growth for GameFi within the next six years, with P2E games\u00a0estimated to achieve $2.8 billion<\/a> between 2022 and 2028, a compound annual growth rate of 20.4%. <\/p>\n \u201cWe’re witnessing the birth of many different economies with different distribution mechanisms as well as the development of different token models (single token, two-token, NFT-driven, etc.). Only time will tell how suitable and reliable each of these will be over the long term in open global markets,\u201d Delphi Digital research analyst Sonny Tsiopani told Cointelegraph.<\/p>\n Related:\u00a0Decentralized gaming IDs provide another avenue of interoperability in Web3<\/a><\/em><\/strong><\/p>\n While crypto gaming companies are becoming more prominent in the industry, some studios are taking cues from AAA games \u2014 high-budget, high-profile games produced and distributed by large publishers \u2014 to improve usability.<\/p>\n Gunzilla Games, a game studio founded in 2020, combines AAA content with blockchain under the hood, allowing players to access full character and weapon customization through owning the assets as NFTs within the game. <\/p>\n \u201cAll blockchain-related features will reside in the background, meaning gamers will never need to set up any wallets, swap any tokens, or perform any of the ‘usual’ crypto-related tasks,\u201d Vlad Korolev, co-founder and CEO of Gunzilla, told Cointelegraph, with regard to how the company is working on gaming experience. He also noted:<\/p>\n \u201cWe see GameFi is at a critical crossroads. On one hand, GameFi has the incredibly unique ability to attract the next 1 billion users to the crypto space (given how many gamers there are worldwide). On the other hand, gamification does not cater to traditional gamers and focuses heavily on just the blockchain and the play-to-earn aspect of gaming.”<\/p><\/blockquote>\n Improving gamers’ experience may also mean a shift from the revenue model for many companies in the space, as free transactions could boost adoption among traditional gamers. \u201cWeb3 has been focused on the DeFi, where users can absorb the cost of a transaction directly. That\u2019s in contrast to a game where even at 5 cents per transaction, it\u2019s simply not acceptable as even simple games would be instantly cost prohibitive,\u201d commented O’Holleran.\u00a0<\/p>\n