The web3 gaming industry is currently undergoing a period of significant transition. According to Jihoz, the cofounder of Axie Infinity and the Ronin Network, there has been a noticeable increase in the number of gaming teams shutting down, both on Ronin and across the broader sector. This development is contributing to a reshaping of the competitive landscape, where smaller, agile teams may gain certain advantages due to their ability to adapt quickly. At the same time, more established teams with a history of success are also in a strong position, as their previous achievements can offer credibility and resilience in a tightening market.

New Phase of Web3 Gaming

As activity consolidates, capital and attention are becoming increasingly concentrated. Ronin’s open infrastructure offers creators greater freedom to innovate, but also places additional responsibility on teams and developers to maintain quality and transparency. Jihoz characterizes the current phase as an evolutionary one, where weaker projects may fail, allowing stronger, more sustainable models to emerge. While this process can be challenging, it is also necessary for long-term industry growth.

Web3 Gaming Enters a Period of Transition

Shifting Models for Tokens and NFTs

As the industry continues to develop, Jihoz predicts that the structure of fundraising and token distribution in gaming will also evolve. He expects greater emphasis to be placed on the reputation of both users and developers. This shift comes amid a wave of successful NFT mints on Ronin, which has attracted a broad range of actors. While some are legitimate builders, the open nature of the ecosystem also makes it possible for bad actors to enter the space.

Jihoz points out that this is not a new challenge. In the early days of Axie Infinity, the project faced widespread skepticism and criticism. It was initially dismissed as a derivative of CryptoKitties, and many questioned its need for selling Origin Axies and digital land. There was also pushback against the game’s breeding system and concerns that the value of Origin Axies was being diluted. However, some of these criticisms led to important developments, such as the introduction of Smooth Love Potion (SLP), a token designed to link Axie inflation to in-game effort and player skill.

Web3 Gaming Enters a Period of Transition

The Role of Trust and Track Records

The long-term development of Axie Infinity illustrates the importance of building trust over time. Jihoz notes that it took several years for Axie and Sky Mavis to earn credibility, and even now, there are skeptics within the community. This, he says, is a natural part of building in web3 gaming. He encourages stakeholders to look carefully at the track records of founding teams, the clarity and feasibility of their visions, and how they conduct themselves in public forums.

As blockchain gaming continues to mature, Jihoz believes that many existing models need to be reevaluated. Incentives across the ecosystem must become better aligned, especially when it comes to encouraging players to hold tokens and NFTs for the long term. He emphasizes the need for buyback mechanisms, improved value accrual structures, and more engaging gameplay features that encourage emotional spending and sustained participation.

Web3 Gaming Enters a Period of Transition

Industry Growth Through Adaptation

Jihoz’s remarks highlight the broader shifts underway in web3 gaming. The consolidation of attention and capital, the increasing scrutiny of developer reputations, and the rethinking of tokenomics all point toward a more mature and selective market. While the current period may be difficult for some teams, it also presents an opportunity to strengthen the foundations of the industry.

According to Jihoz, these changes are part of a necessary evolution—one that may be painful in the short term but is essential for long-term sustainability. By drawing from past experiences and adapting to present challenges, the web3 gaming sector may continue to evolve into a more credible and resilient part of the digital economy.