House of Sand: Why Blockchain Gaming Never Took Off

Back in 2022, in the depths of what was known as the Crypto Winter, there was still a lot of talk about how blockchain and crypto gaming had a bright future. Some of the arguments for this were appealing, at least on paper. However, in 2025, when crypto is booming again (at least for now), there is little talk about blockchain gaming. Much of the promised revolution never took off. There is a handful of playable blockchain titles, even a few decent ones, but overall, it has made little impact.

There are numerous theories as to why this is the case. Perhaps the most compelling is that the idea of blockchain gaming was always based on financial concepts like P2E (play to earn) and not fundamentals, like creating entertaining games. The vast majority of titles created, including the established ones like Axie Infinity, were boring and repetitive, not to mention built on shaky economics.

Some Blockchain Concepts Are Compelling

As mentioned, there are some aspects that were – and still are, arguably – compelling. The idea of recording transactions on the blockchain and issuing ownership of digital items through NFTs held some merit. Gamers are used to in-game transactions, everything from buying skins to using gold coins at social casinos, so it is not an alien concept to say that those things could be conducted on a public ledger via crypto transactions.

The blockchain as a ledger does have benefits. We were told, for example, that blockchain gaming would mean that digital items would be transferable, moving from one game to another. Some blockchain developers are still promoting this idea, tying it in with the concept of metaverse experiences (that’s another area of entertainment that feels dead), yet all too often, the idea of instilling value in digital items felt forced.

In the end, it constantly goes back to the economics. P2E was always predicated on more and more people buying into the game (buying a game’s linked cryptocurrency or NFTs), favouring those players who were in at the beginning or those who grind away for hours each day. Yet, the model is a classic pyramid scheme, with more losers than winners. It simply cannot operate in any other fashion.

UX and Trust Problems Kept Gamers Away

Moreover, onboarding into blockchain games was never user-friendly. Wallet connections, gas fees, and complex tokenomics created friction that all but alienated casual gamers. While mainstream gaming focused on seamless UI/UX and immersive storytelling, blockchain projects often demanded players become part-time economists just to participate.

There was also an ecosystem problem. Big developers largely stayed away, fearing backlash from core gaming communities, many of whom derided NFTs and crypto integration as exploitative, and rightly so. Ubisoft’s Quartz initiative was met with open hostility, while Valve outright banned blockchain games from Steam. Without the support of major studios or platforms, blockchain gaming remained niche, largely cut off from the wider gaming world and staying within the spheres of crypto enthusiasts and, sorry to say, grifters and the gullible.

And yet, perhaps the final nail in the coffin was trust or lack thereof. Scams, rug pulls, and token crashes were rife. For every legitimate project, there were ten more promising AAA games on the blockchain that never got past flash trailers promising the earth and token pre-sales. Even now, in 2025, many gamers instinctively associate the term “blockchain game” with grift rather than gameplay. That’s not to say blockchain gaming is dead and buried. Some developers are still experimenting with concepts like player-owned economies and digital asset portability. But for now, at least, it’s clear that the grand vision of a decentralised gaming future was built on shaky ground.