Photo: Chi Cuong

After a boom in the number of projects and quick funding accumulation, Vietnam’s gamefi and non-fungible token game markets have begun to show signs of slowing down – partly due to weaknesses that caused tens of millions of dollars in damage via hacks to some popular projects.

Virtual or poor-quality projects that were created for the sole purpose of raising capital and then quickly disappear without making a mark have shaken the confidence of some investors. However, representatives of many businesses say that the game market, including gamefi, is still a field of high potential that will continue to develop significantly, especially with blockchain technology being widely applied.

“Blockchain provides effective capital-raising platforms by using tokens. Without gamefi, without blockchain, it is very difficult for game developers in Vietnam to raise millions of dollars and ensure financial health for the research and development of quality game products,” said Quang Nguyen, CEO and co-founder of MetaDOS.

MetaDOS is a new product introduced by his team eight months ago and is still being developed. Quang, who has more than 10 years of experience working at famous gaming publishing and development companies in Vietnam, is raising capital for the project and hopes for a total valuation of $30 million when it goes public at the end of this year.

“With a gamefi project, reasonable token design and operation play an important role in deciding the life cycle of the game,” Quang said.

Vietnamese game products launched in the recent uptrend period have mainly focused on financial factors to attract players, he added. “We also develop free elements to acquire loyal players. I think after the trend of play-to-earn or move-to-earn, the blockchain game industry will put the user experience factor above the financial factor,” Quang said.

One of the biggest advantages of blockchain, according to experts, is transparency. Blockchain technology will help store large volumes of data with high security. Power will not be focused on game publishers, and they will not be able to print in-game items at any time they wish, but the quantity and product parameters will be transparent on the blockchain as soon as they are released.

This technology also helps game developers partially solve the problem of reward inflation, especially when the wave of play-to-earn systems exploded last year and caused the number of players to increase. Trinh Ngoc Duc, CEO of FOTA said, “With a gamefi project, if the ‘earn’ mechanism is not attractive, it is also difficult to attract professional gamers. On the contrary, if the mechanism is very attractive but the entertainment factor is low, it will not last long.”

Phan Thanh Tung, co-founder of Moonknight Labs, agreed that most blockchain games that have been released have not proven effective. “The game may not be attractive enough for ordinary players or has not brought good economic benefits to investors, leading to an inevitable decline,” Tung said. “Besides that, the concept of blockchain is equated with cryptocurrency, leading to false thinking, completely negating the technological benefits of blockchain with games.”

According to Tung, what game developers need the most is a bridge to connect ordinary players, orienting them to understand why a game needs blockchain tech and what value it can bring. Blockchain game projects also need to instil this in order to create quality blockchain game products that convince players. “Becoming a bridge is how we support projects, so that everyone is following the same path, thereby creating a stronger community,” he emphasised.

Moon Knight Labs is one of the first Vietnamese enterprises to develop products on the blockchain platform with the game Faraland. The venture completed the seed round before blockchain game technology became a hot trend in May last year, and attracted investment capital of about $2.4 million.

Tung noted that blockchain game products are only a small part of the entire Faraland ecosystem, something that Moonknight Labs wants to emulate.

“We have not yet had seed funding because we have many other activities that generate revenue, such as advertising and selling technology. This year, we’re releasing books and aiming to create an educational institution dedicated to training in technology, art, languages, and additional human resources for the company itself,” Tung said.