Deep into the Philippines: an important window to observe the development trends of Web3 games
Original author:Leah Callon-Butler
Original compilation: Deep Chao TechFlow
The Web3 gaming space is about to explode again, just like Axie Infinity did, and by focusing on whats going on in the Philippines, we can see how Web3 gaming is developing.
The Philippines leads the world in the development of Web3 games.
Pixels, a farming game on the Ronin blockchain, recently became the first web3 game since Axie Infinity to have over 100,000 daily active users (DAU). Within a week, daily active users jumped from 4,000 to 111,000, although some skeptics pointed out that the data may be inaccurate and believe that these users may be bots. Even Pixels CEO admits that perhaps only 40% of these daily active users are real people.
However, at last months YGG Web3 Gaming Summit in Manila, Philippines, Sky Mavis co-founder Jeffrey Jihoz Zirlin pointed out that Google Analytics data showed that there were more than 82,000 visitors, or more than 25% of all traffic to the Pixels website. , from the Philippines. He boldly claimed that these players were not bots, but Filipinos.
As with any game with financial incentives, there are always bots. And daily active users (DAU) is a metric that can easily be overstated because it’s hard to tell the difference between bots and real people. But I have reason to believe that Pixels player base may indeed be more likely to be real people than just bots. Because at the beginning of the last cycle, that is, in mid-2020, I first learned about the popularity of Web3 games in the Philippines when I was living in the countryside of the Philippines.
Axie Infinity - the beginning of Web3 gaming
At that time, I was living in rural Philippines and heard that a family in a neighboring province was banned from playing a little-known blockchain game, Axie Infinity. The reason is that when the game maker Sky Mavis discovered that there were up to 20 accounts playing 24/7 from the same IP address, they banned the family from playing the game.
In an effort to get their account reinstated, the family shared a video showing their extended family sitting in a circle on the floor, all fighting in a PvP arena. It turns out that they are all real people playing. In retrospect, this video may have been the world’s first evidence of multi-generational DeFi users.
Even though interest in the game was low at the time—Axie had less than 500 daily active users in July 2020—I thought earning money by playing blockchain games would be a very interesting use case, so I decided to write an article for Opinion column writes about this story. I also couldnt imagine what would happen next.
After word spread that the game allowed people to make money, millions of non-robot Filipinos joined the game. As of July 2021, Axie had nearly 3 million daily active users, at least 40% of which were from the Philippines. According to our calculations, their gaming revenue for the month was approximately 2 billion Philippine pesos, or about $40 million USD—the same amount as all overseas Filipino workers sent back to the Philippines from Hong Kong.
As a result, gamers in the Philippines started calling themselves MFWs (Metaverse Filipino Workers). Axie’s utility token, SLP, is used for cross-border remittances, is listed on all major local licensed exchanges, and is widely accepted by merchants – from dentists to dumpling shops. Hundreds of Web3 gaming guilds have been formed across the Philippine archipelago, the first of which is Yield Guild Games (YGG), which raised over $21 million in venture capital funding to become the first Filipino-led startup powered by A16z crypto . As of November 2021, 17% of MetaMasks 21 million users were in the Philippines.
The craze has sparked a media frenzy, and other emerging economies such as Indonesia, India, Venezuela, Brazil and Nigeria are also paying attention to blockchain games. Soon, every country was following the same path that the Philippines had taken. Ive learned that anything that happens in the Philippines is a harbinger of global adoption of Web3 games.
The Philippines is ready for Web3 games
According to data from CoinGecko, for the third consecutive year, the Philippines ranks first in the world in interest in Web3 games, which is attributed to the country’s young demographic structure, high digitalization, a largely unbanked population, and a strong remittance culture.
So, around 2015, the main use case for blockchain was crypto-asset-backed remittances, which reduced the cost and time for overseas Filipino workers to send money home. So, when Axie breaks out, people in remote areas of the Philippines will need little to no bootstrapping support because they already use and understand cryptocurrencies.
Even so, the savvy of early Axie players surprised even the most ardent supporters of Philippine blockchain. On any given day, players may be exchanging pesos (Philippine currency) for ETH through official exchanges like Coins.ph or PDAX. They might then transfer ETH to MetaMask to purchase NFT assets on the open market, send them to PvP arena battles to win SLP tokens, and redeem the winnings back to ETH through a DEX like Uniswap before walking away.
Axie returns to the Philippines
However, in the Philippines, even after Axie stopped offering financial rewards in 2022, a small group of people continued to play the game for fun. Thats why Jihoz chose Manila to announce the return of the Axie Classic with financial rewards. Because Filipinos are the leaders in web3 games. And, the original version of Axie, despite being heavily criticized by the rest of the world for being a less than entertaining game, has always been a favorite among Filipinos.
Some of my Filipino friends are very excited about the return of the Axie Classic. Because this is the game that changes their lives; this is the game that opens their eyes to the possibilities of future games.
The market has reached a critical moment
Based on past experience, I think this is a critical moment and we are about to see another explosion in the web3 gaming space. The earliest stages of the cycle will be inspired and driven by web3-native innovation, like what we saw with ERC-6551. Then, once a new game or model gains traction, there will be thousands of imitators - for example, Ive seen a few proposals for a version of GameFi from Friend.Tech.
Just like we saw in the last cycle, there will be a lot of projects coming out. When the market approaches its climax, all those who switched from Web3 to AI in the bear market will return to Web3 with a gorgeous investment plan. This time, some will receive funding and experience huge but unsustainable growth. When eventually, the market inevitably declines, the price and popularity of good projects will fall, but not to zero.
Anything that goes up eventually comes back down, albeit at a significant step above where it started - with more community members added, more daily active users. This is a familiar path for more experienced crypto travelers, but may be a first-time experience for web3 enthusiasts in the current cycle.
Thinking back to the beginning of the last bull market, I remember a Filipino family playing Axie on their living room floor. Now, as were in the early stages of the next bull cycle, top Web3 game Pixels has surpassed 100,000 daily active users, and the bots or not bots debate is in full swing.
This time around, the price increases and the growth of Web3 gaming may be staggering, but all the signals are the same, and they all originate in the Philippines.
