Introducing: Dark Tunnels

Fully onchain games. Crypto-native games. Autonomous worlds. Onchain realities. Eternal games. Infinite games. Web3 games.

Though the lexicon is far from settled, the fascination around the emerging cadre of games designed to be maximally onchain cannot be ignored.

These experiences represent the truest manifestation of the decentralized principles of web3 as applied to gaming, yet they are also the least understood by the industry at large.

My goal is to change that.

In order to promote an increased understanding of the opportunities presented by onchain gaming, I will use this newsletter to examine the current state of the space through a pragmatic, business-oriented lens.

Admittedly, this nascent field is currently little more than a niche within a niche. As of Q1 2023, there were fewer than 800k daily unique active wallets making transactions across the entirety of the blockchain gaming sector, which includes both onchain games and the larger crop of “web2.5” titles currently dominating the discourse. Compare that to the more than 3B gamers worldwide, and it’s easy to wonder why business leaders should care about fully onchain games at all.

I would venture to guess that there are fewer than 10,000 people worldwide actively working in this tiny corner of the gaming universe. The real number is likely closer to 1,000. A recent FOGDAO podcast estimated that “less than 50” teams were working on these types of games. As a point of comparison, Activision reportedly staffed upwards of 3,000 developers on the most recent Call of Duty title alone.

In addition to being small in scope, explorations of fully onchain gaming have thus far been largely academic exercises. There is nothing wrong with this, of course — studies of the technological capabilities and unexplored design spaces in web3 are massively important to the continued growth of onchain gaming. Groups like 0xPARC and MatchboxDAO (among others) have done (and continue to do) incredibly impressive work, much of which has deeply informed my own thinking.

To paraphrase Arad (emphasis added throughout), understanding fully onchain games is akin to “walking into a dark tunnel — the constraints and design space are so fundamentally different than anything else, that we have no idea what’s on the other end of that tunnel — the only way to find out is to walk the distance.”

It is my view that a different approach is required to accelerate development and reach a broader audience of gamers — to reach the other end of that tunnel, if you will.

In order to attract greater levels of investment and larger numbers of experienced game developers to the space, there must be a clear business rationale for creating fully onchain games.

In this publication, I will lay out the key aspects of this new approach while also aggregating many of the disparate sources of information on this topic into a cohesive narrative. Along the way, I’ll reference interesting case studies and tie this movement into several larger trends that extend beyond gaming in an attempt to both articulate my own thesis and inspire others to pursue similar goals.

In each edition of Dark Tunnels, you can expect the following:

• A well-researched, thoroughly documented, and business-oriented examination of the fully onchain games ecosystem.

• Hand-crafted writing and analysis with occasional input from collaborators and fellow games industry practitioners (including several people actively building in the fully onchain games space).

• Educational and informative content — without being self-indulgent.

• Optimistic and future-facing commentary — without being hyperbolic.

This is a passion project for me. My goal is to translate that passion so that you will find these topics as fascinating as I do.

I hope you’ll join me as we explore the Dark Tunnels, together.

Thanks for reading. I’ll be back soon with my first essay.