GameFi faces major challenges in 2025 due to player engagement issues

Blockchain gaming is expected to encounter significant challenges in 2025, particularly around player engagement, technology adoption, and sustainable economies.  

Tobin Kuo, CEO of blockchain gaming company Seraph, shared insights highlighting that over 60% of players disengage from Web3 games within the first 30 days.  

Kuo attributed this to poor gameplay mechanics and a lack of long-term incentives.  

“As the attention economy accelerates, projects must prioritise player-centric design, focusing on immersive storytelling, skill-based rewards, and game mechanics that go beyond ‘earn-first’ models instead of relying on trend-based attention,” he stated.

In addition to improving gameplay, integrating new technologies, such as generative AI, is essential for maintaining player retention.  

Kuo noted that projects that fail to adopt such technologies see a 30%-40% reduction in player retention compared to those that do.  

The need for sustainable in-game economies is also a critical challenge.  

Kuo explained that unstable in-game economies are a leading cause of insolvency for many projects.  

He suggested that best practices for sustainability may include dynamic loot distribution, staking-based rewards, and player-controlled economies through decentralised autonomous organisations (DAOs).  

The case of Hamster Kombat (CRYPTO:HMSTR), a game that gained 300 million users in less than five months, underscores these challenges.  

After a token airdrop, the game saw an 86% drop in active users, with just 41 million remaining by November.  

The Blockchain Game Alliance’s 2024 State of the Industry Report also revealed that 53% of Web3 gaming professionals cited poor user experience and complex interfaces as significant barriers to onboarding new players.  

Meanwhile, 33% identified poor gameplay experiences as a major obstacle.