Framework Ventures Co-Founder: Take the Web3 Out of Marketing Web3 Games

The crypto bear market may have chilled public interest in blockchain and cryptocurrency, but venture capital firms like Framework Ventures continue to pour billions into the industry.

“There are three paths,” Framework Ventures co-founder Vance Spencer told Decrypt at Chainlink SmartCon. “There is traditional DeFi, we’re still investing in that. There’s the regulated DeFi [products], which is just emergent. And then there are the regions like Brazil, India, and Southeast Asia—they just need the infrastructure to come online, so we’re investing in that too.”

One area that Framework Ventures has focused on is blockchain gaming. The firm earmarked $200 million for the blockchain gaming industry in April through its FVIII fund.

“People are excited about [blockchain] games because they’re all launching Q1 [2023],” Spencer said, adding that with so many games coming out at the same time, the industry is going to find out quickly if it is any good at game development.

“Gaming and DeFi are two things that we do very tactically, because large markets are immediately available and we have use cases that exist currently,” Spencer said.

But that is easier said than done. The promotion of blockchain or Web3 gaming has outpaced its design capability, and many in the gaming community see it as nothing more than a cash grab at gamers’ expense.

“The first iteration games were [like] Axie Infinity,” Spencer said. “That was hyper-financialized, potentially financial napalm,” he said, noting what he called “violent upswings and downswings” of the market. But Spencer says he is optimistic about the next six to 12 months as more traditional games studios build games on-chain.

“They probably won’t have their own native token,” he said. “Maybe they put NFTs on-chain, or have monetization, and have the virtual currency as tokens,” but will be more grounded in reality.

As Spencer explained, one issue slowing the adoption of blockchain or Web3 games is that they are known as blockchain Web3 games. That label carries years of baggage, including a negative environmental impact.

“I think [not referencing blockchain or Web3] will be the recipe for success for the first iteration of games,” Spencer said. “We’re bringing on people who play traditional games, and you don’t want to inundate them with too much blockchain.”

Spencer went on to say that developers who use the blockchain to create better user and gaming experiences like virtual reality, augmented reality, and GPS-based games are the ones who will be successful.

“A lot of people look at the 1,000 DeFi protocols that didn’t succeed and are a little bit disheartened, but I choose to see the 50 that did work,” Spencer said. “You have to throw 1,000 startups at the wall for 50 to work.”

While regulation and the risk of driving blockchain innovation overseas is a concern, Spencer said he is optimistic that, in the end, it will create better investment opportunities.

“I feel [it] presents an opportunity; you’re gonna have DeFi in its current form, but that will be more overseas,” he said. “The [projects] in the U.S. are gonna have to fall into some regulatory jurisdiction.”

DeFi under regulatory oversight, Spencer explains, would be positive for the industry and will open it up to investors, the traditional banking system, and access to more capital.

“There’s going be some growing pains,” he says. “But the industry always needs to be changing and evolving and can’t just be the same thing. And so we’re pretty bullish on that. It’s going to be a headache, but that’s okay.”

 

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Source: https://decrypt.co/111586/framework-ventures-co-founder-take-the-web3-out-of-web3-games