😵 Not dead

Hey frens! Welcome back to The Drop.

It’s Thursday, and I’m honestly a little surprised how fast this week has gone so far. We’re talking about the state of blockchain gaming today, looking back at how things have changed, plus news about the latest social crypto app for you.

Let’s dive in.

— Kate Irwin

P.S. Let me know how you’re liking The Drop! Send me an email at [email protected].

The shape of crypto gaming in 2025

Blockchain gaming has gone through various cycles of sentiment.

These cycles include 2017 with CryptoKitties and 2018 with games like Axie Infinity, Gods Unchained and Splinterlands. 

While some might think crypto gaming is in decline these days, venture capital firm Bitkraft Ventures doesn’t see it that way.

“Not only is it not dead, but its future is as bright as almost any category,” Matt Halstead, a new partner at Bitkraft, told me in an interview. 

The firm counts AMGI, Immutable, HyperPlay and Yield Guild Games among their 100+ portfolio companies, plus non-crypto firms like Discord and Epic Games. Bitkraft obviously stands to benefit from crypto gaming’s success, but they’re also investing in what they believe the future will look like.

“One bet that I would be, you know, very happy to make is that gaming will not only exist, but it will be multiples bigger than it is today. And I just don’t think you can look at the world and have that level of conviction in too many themes. And so I think to ignore gaming will be proven to be a big mistake,” Halstead added.

After the play-to-earn run subsided in early 2022 — when tokens like Axie Infinity’s AXS token fell roughly 91% in less than six months — some upstart crypto game studios touted a “play-and-earn” narrative. 

A number of crypto games studios told me around that time that the industry needed to get away from the farming-focused financialized games, arguing that their games would put gameplay before their economies to “make a good game first.” 

Around that time, some game studios and investors held the view that in-game items would become interoperable, and that NFTs would be part of that vision.

But crypto gaming’s once-touted vision of interoperable in-game items as assets on the blockchain hasn’t quite panned out — especially when hype around the metaverse faded in 2023. 

Halstead suggested the prevailing sentiment toward crypto gaming is something that’s a problem across crypto: There’s a very short feedback loop where expectations don’t always meet reality.

“I just think there’s a fundamental lack of understanding of games in general,” he added.

So how could crypto organically fit into games, and where will we see future success?

Halstead sees the creator economy, cosmetic items, and the social element of gaming as areas that could do well with blockchain integrations going forward. 

But there’s also the obvious, continued fit of more financial-forward games, or “GameFi” titles, wherein a betting element or gambling element is offered with an entertainment layer on top.

Bitkraft General Partner Carlos Pereira predicts that this year, we’ll see a solid AI-native crypto game release. But “risk-to-earn” is also a big subgenre.

Loot Labs is one of Bitkraft’s most successful portfolio companies right now, Pereira told me. Loot Labs offers buyers mystery assets as NFT loot boxes, whereby you spin a wheel and don’t know what you’re going to get.  

“And so as long as you acknowledge that there’s this concept of risk-to-earn,” Pereira said, “that’s totally okay. And we’ve had these games for a long time, and there’s fit with crypto. [And] there’s still the space for all the other types of games.”

Bitkraft advises all their portfolio game studios against selling NFTs or launching a token before the game releases because that approach sets high expectations — and puts studios in a bind if they fail to meet those expectations by backing out or adjusting earlier plans.

“We certainly believe that on average the right decision is not trying to monetize your community too early [...] and that’s not what the average games have done,” Pereira said. “Of course, we have had things that fail. Of course, we’re in the business of making mistakes, and then hopefully when we don’t make a mistake, it’s a really good thing. But you haven’t seen us attached to the games that raised a bunch of money on a launchpad, or the games that sold $40 million in NFTs.”

Where Culture Ships Onchain

Permissionless IV isn't about infrastructure for its own sake — it’s about apps people actually use. Wallets with real UX. Loyalty that isn’t locked in Web2. NFTs with purpose.

Gaming, AI, creators — all live, all moving.

This is where the next wave of consumer crypto gets built.

Not just protocols — products.

📅 June 24–26 | Brooklyn

Moonpay offers Mastercard for stablecoin payments

Crypto payments firm MoonPay is working with Mastercard to let businesses release their own stablecoin-focused MoonPay payment cards. 

Specifically, USDT can be spent with the card, per an image shared on social media. Transactions will convert crypto into fiat, and the cards use MoonPay subsidiary Iron’s tech.

Mastercard has continued to bring crypto-to-fiat conversions at point of sale with new cards. In February, MetaMask unveiled a Mastercard that effectively lets users spend their crypto from their self-custodied wallets. 

Last month, Sui fans also got a Mastercard option thanks to a deal with xMoney and xPortal, and OKX also spun up its own Mastercard for spending stablecoins.

What I want to know: With all these new crypto card options, how many people are actually using them?

Watch-to-earn? 

There’s a new iOS and Android app called 10K that launched yesterday. Built on Solana, viewers can watch videos on the app to earn content creators’ tokens. Privy, which Digg 2.0 also uses, powers 10K’s self-custodial crypto wallets. 

The app’s Google Play page states that it has over 500 downloads on Android as of Thursday morning (but less than 1,000).

• Coinbase plans to add the AI crypto token tool Bankrbot natively to the Coinbase Wallet soon. Yet another push from Coinbase to expand its Wallet to make it more than just a place to hold crypto amid increasing competition (we also know it’s testing social media-like features).

• Pudgy Penguins will launch a 1v1 battler game via Telegram and TON called Pengu Clash. Users can get NFT traits for their penguin and earn loot chests as they play. Probably something!