Gaming sector accounted for 62% of web3 startups funding, raising $7.1 billion in 2022
Amazon, the e-commerce giant, is set to launch a digital assets enterprise in April 2023 with a focus on gaming and NFTs, according to an exclusive report released by Blockworks on January 27.
Although Amazon has yet to make any official announcement itself, sources in the know have claimed that the firm’s Web3 ambitions include plans to team up with L1-blockchains, blockchain-based gaming startups and digital asset exchanges.
Reportedly, one of the use cases will be attracting Amazon’s customers to play web3 games and be rewarded with free NFTs.
It is no surprise that the leading e-commerce company sees Web3 gaming as an appealing niche.
According to figures from CryptoSlate earlier this month, Web3 gaming startups collected the largest amount in funding compared to other Web3 segments throughout 2022, raising $7.1 billion. That accounted for 62% of the total amount invested in Web3.
Not only does Amazon’s expansion signal the company’s recognition of the Web3 gaming industry’s potential, it may also be a strategic move to further monetize the video games live streaming platform, Twitch.
Gamers make up the majority of the platform’s daily active users, and Amazon-owned Twitch had an average of 2.78 million concurrent viewers, while nine million users streamed on the platform once a month in 2021.
Since Amazon Prime has been integrated into Twitch, to offer Prime’s subscribers free access to games, the potential inclusion of Web3 games on Twitch and Prime Gaming may represent opportunities to grow the Prime membership base by taking an early lead in a new industry.
With over 200 million paying Amazon Prime members worldwide, the US’ leading e-retailer recorded annual revenue growth of over 20% every year since 2015. With its significant user base,Amazon will potentially serve as an access point for web3 to gain traction among the mass consumer audience.
In the same week this rumor broke out, Cathedral Studios, the gaming studio behind the NFT game The Bornless, also announced it has been accepted into the Amazon Activate Startup Program. One of the key focuses of the partnership will be exploring ways to ensure customer protection for gamers in Web3.
Amazon’s reported forray into the Web3 space, coupled with AWS Amazon Activate Startup Program’s new participants including Web3 gaming startups, suggest that the e-commerce giant might be looking to vertically integrate its gaming business, making a self-sufficient Web2-3 ecosystem incorporating Prime Gaming and Twitch.
As early as April 2022, CEO of Amazon, Andy Jassy already expressed his optimistic view on NFTs in a CNBC interview.
“I expect that NFTs will continue to grow very significantly. We’re not probably close to adding crypto as a payment mechanism in our retail business, but I do believe over time that you’ll see crypto become bigger and it’s possible down the road,” said Andy Jassy.
It is worth noting that Amazon isn’t the first e-commerce company to enter the NFT space. Its competitor eBay was the first to embrace NFTs, acquiring the NFT art marketplace KnownOrigin in May last year.