Pixels experienced mixed results in 2024. According to the financial report released by CEO Luke Barwikowski, the game saw its daily unique active wallet count (DAUWs) peak in May but gradually decline throughout the year. The year ended with 283,000 DAUWs, reflecting the impact of adjustments to the play-to-earn rewards strategy. Conversely, the number of paying wallets—accounts spending PIXEL tokens in-game—rose steadily, with a 75% increase from February to December, culminating in 109,000 paying wallets by year-end.

This growth highlights a shift in player behavior as more users engaged with in-game purchases. A recent analysis by BlockchainGamer also pointed to an increase in average spend per wallet during the latter months of 2024, which was attributed to the introduction of new in-game features. February, in particular, saw high average revenue per user (ARPU) as players spent to maximize their initial airdrop totals following the launch of the PIXEL token.

Pixels' DAUWS Down

Return on Rewards Ratio 

A key metric highlighted in the report is Pixels’ return on rewards (ROR) ratio. This measures the proportion of PIXEL tokens distributed as rewards compared to those spent in-game. By the end of 2024, the ROR stood at 0.5, meaning that for every 100 PIXEL tokens given as rewards, 50 were reinvested into the ecosystem through in-game spending.

The gradual improvement in this ratio throughout the year reflects the team’s efforts to optimize rewards distribution. The strategy focused on incentivizing players who reinvest their tokens rather than those who extract value by selling their rewards. This optimization is critical for long-term ecosystem sustainability and reducing sell pressure on the PIXEL token.

Return on Rewards Ratio

Financial Challenges and Prospects for Profitability

Despite progress, the financial report revealed that Pixels is not yet profitable. In December, the game recorded its highest monthly revenue with 10 million PIXEL tokens spent in-game. However, net revenue remained negative at -10 million tokens, although this marked an improvement compared to earlier months. Achieving a ROR above 1 is crucial for profitability, as it would indicate that more tokens are spent than are distributed as rewards, ensuring a sustainable token economy.

Barwikowski acknowledged the challenges but expressed optimism about the future. He emphasized the significance of the RORS (Return on Reward Spend) metric, which is being developed to create a play-to-earn model that generates positive revenue for the ecosystem.

Monthly Token Flows Negative 

Emerging Opportunities and Innovations

The report also highlighted two promising developments for the Ronin-based social RPG. The first is the success of Pixel Dungeons, a new game published by Pixels that also uses the PIXEL token. Initial playtests showed a ROR exceeding 1, indicating that the game has the potential to drive positive returns for the ecosystem.

Additionally, advancements in big data and artificial intelligence present new opportunities for optimizing user acquisition. These technologies could help the Pixels team identify and target players more likely to spend their rewards in-game, further enhancing the sustainability of the play-to-earn model.

Pixel Dungeons

Final Thoughts

Pixels continues to navigate the challenges of building a sustainable blockchain gaming ecosystem. While profitability remains a work in progress, the steady growth in paying wallets, improvements in reward strategies, and early success of new initiatives provide a foundation for future innovation. Barwikowski’s vision of refining web3 fundamentals through metrics like RORS highlights the company’s commitment to developing a more robust and sustainable model for blockchain gaming. For further updates, followers are encouraged to track the company’s progress on X.

Source: BlockchainGamer