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The crypto gaming industry is growing in popularity as more capital is invested in space and traditional web 2.0 gaming studios try to enter the web3 market.
Immutable, an Australia-based Web3 gaming company, has raised an initial $500 million developer and venture investment fund, Robbie Ferguson, Immutable’s president and co-founder, told TechCrunch.
The capital will be used to fund projects to build Web3 games and NFT-focused companies on its Layer 2 Ethereum-focused platform, Immutable X.
Immutable’s primary goal is to enable the next generation of Web3 gaming at scale, Ferguson said. Game developers and IP holders already building on its platform include GameStop, TikTok, OpenSea, and Illuvium to name a few.
“We see gaming as one of the greatest opportunities that has ever existed on Web3,” he said. “The total addressable market will be enormous and much larger than what gaming is today – a $100 billion industry for in-game items alone.”
Ferguson noted that the overall addressable gaming market is growing at 10% year over year, so the industry could be worth $1 trillion in its own assets given that movies, TV shows, and music end up in games.
The half-billion-dollar fund was brought together from a “mixture of places,” Ferguson said. “There’s obviously all of our venture partners using their balance sheets and VC allocations to participate in these deals, there’s cash deposited [Immutable’s] Balance sheet, and there are also the Foundation grants that are specifically designed for this purpose to incentivize and build the Immutable ecosystem.”
The fund will also partner with other Web3 gaming and NFT-focused investors, including BITKRAFT, Animoca Brands, Arrington Capital, Double Peak, AirTree, King River Capital and GameStop, as well as strategic gaming publishers to explore additional investment opportunities.
In March, Immutable closed a $200 million Series C round led by Singapore-based firm Temasek, which valued the company at $2.5 billion. To date, Immutable Ventures has made investments in a handful of Web3 companies including StarkWare, Stardust, PlanetQuest and Topology.
“It’s the perfect time to develop really long-term games that will have real in-game economies that will bring hundreds of millions to a billion players to web3,” Ferguson said. “I firmly believe that the first hundred million users will come from a [Web 2.0] Game. All it takes is a breakthrough here and this is a reasonably sized successful game where NFTs can be deployed completely smoothly under the hood and take advantage.”
Over the next 24 months, Ferguson expects mid-market gaming studios to enter the Web3 world and be the fastest to market. Then more games will seep into the Web3 ecosystem over the next two years, he added.
“The main thing is that it takes time to integrate web3 and it takes time to make a good game,” Ferguson said. “In eight to 12 months there will be a huge influx of Web3 games, and there will be hundreds of triple-A games over the next few years.”