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April 10, 2024
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WalletConnect Pulse Report: Are wallets the gateway to mainstream web3 gaming?
Beyond player-driven content and community engagement, simplified wallets emerge as the key driver behind web3 gaming’s success.

Web3 gaming continues to garner attention given its potential for decentralized ownership of in-game assets, play-to-earn mechanics, and innovative gameplay experiences.

Some reports have shown a substantial surge of 54% in users from Q4 of 2023 to January 2024. With a notable jump in daily active users (DAU), many within the gaming community still maintain that asset interoperability, player-driven content, and community governance are the key factors contributing to the success of web3 games. But, new findings suggest it is the simplicity and effectiveness of the wallets used for gameplay that truly matter.

Most of today’s web3 gaming platforms have digital wallets as a standard feature to play. Originally designed for storing and managing funds, wallets in web3 gaming have evolved beyond their initial scope. They now serve as the central interface for users, safeguarding their identity, storing value, and granting access. However, many newcomers interested in exploring web3 gaming still face difficulties with current crypto gaming wallets, presenting a major roadblock for wider adoption.

The pursuit of seamless UX in gaming wallets

We sought to delve deeper into today’s crypto experience by launching our WalletConnect Pulse report, which highlights wallet complexity as a major barrier to web3 adoption. Despite opportunities for experienced users in Play-to-earn gaming, newcomers still find navigating the crypto space challenging. Simplifying the process is crucial for mass adoption because as many often say, in web3, everything begins with a wallet. As dYdX put it in our report, “The protocols that abstract away all the complexities will be the ones to win in the long run.”

Insights from the report reveal clear priorities for enhancing wallet satisfaction and boosting user experience. Over half of respondents (51.2%) emphasize the importance of user-friendliness, while significant proportions seek more incentives (42.1%), improved security features (41.8%), and lower transaction fees (41.8%).

Top 3 crypto experiences consumers are looking for

These findings highlight the multifaceted demands of users, and amplify key areas for gaming wallet providers to prioritize to drive greater engagement and satisfaction. By using integrations like email login, they make it simpler for newcomers to get into the game, similar to how they log in to websites like Google.

Web3 gaming continues to hit new milestones and there’s no question that it has the potential to usher in millions of users into the web3 ecosystem. Just recently, this sector of the industry saw a record-breaking one million daily unique active wallets (dUAW) – a 33% share of the industry's activity in one month. Over the past two years, web3 gaming-related projects have attracted over $15 billion in funding, surpassing investments in nearly all other tech categories. Even leading crypto platform Kriptomat said it enhanced its gaming experience with the help of our Web3Wallet SDK, which simplified the user journey, especially for those exploring web3 games for the first time.

So, with all-in-one user-friendly digital wallets, do we have the potential to onboard millions more through web3 gaming?

Security and reliability are the MVPs

It is crucial for wallet providers to first focus on ensuring robust security and reliability, as these elements are foundational to providing smoother gaming experiences. A single oversight could result in irreversible loss of user funds, highlighting the importance of utilizing trusted solutions. The main challenges web3 gaming wallets are facing are in security, user experience, and multi-chain compatibility. But, the tide may be turning on the security front as our very own CTO Derek Rein states in the report: “Security is still a UX blocker for mainstream adoption. But soon, no more.”

On the consumer side, we discovered intriguing insights into crypto security sentiment and adoption levels. Interestingly, over 70% of respondents said they have never lost crypto due to phishing or hacks, and more than half expressed a high level of confidence in using crypto products and services. However, only 27% said they regularly use added security measures while 6% admitted to not even adding them in the first place. There is a clear need to educate users – especially newcomers – on existing security measures to ensure broader adoption and pave the way for a more secure and user-friendly web3 gaming experience.

So where do we go from here?

The success of web3 gaming hinges not only on player-driven content and community engagement but also on the simplicity and effectiveness of gaming wallets.

As we navigate the challenges ahead, educating users, especially newcomers, on existing security measures and streamlining onboarding processes will be pivotal for broader adoption. Fortunately, with the emergence of web3-native wallets prioritizing simplicity and user-friendliness, the industry is poised to overcome barriers and unlock its full potential in onboarding the next billion users to web3.

Want to learn more about today’s crypto consumer? Download the WalletConnect Pulse today to better understand their attitudes, behaviors, and preferences.

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