Web3 Gaming’s New Playbook: Learning Monetization Tactics from Social Network Games

17 min readDec 20, 2023

TLDR:

Match-3-type games (Candy Crush Saga, Homescapes, Sheep a Sheep in WeChat, Pirates’ Treasures in VK, etc.) stand out compared to other genres within social network gaming. They compete in mobile revenue even with PUBG and Genshin Impact while being singnificantly less complex in terms of gameplay and development. Sports/simulation games (especially card games and pool) and endless runners are also popular on social networks. RPGs are leading on WeChat and QQ, while dating games are popular on VK.
Common monetization models used in web3 games are in-game purchases of items, upgrades, repairs, and boosts; NFTs representing characters or items and tickets to game events and tournaments; in-game NFT marketplaces; in-game DEXs; and staking.
There is a lot of overlap between casual web3 and web2 games in terms of monetization due to similar game mechanics, such as stats, leveling, health/mana systems, and the ability to personalize gaming experiences by changing the visuals and stats of characters or items. The main difference, however, is the ability for web3 games to carry the value of in-game assets outside of the game, allowing for revenue generation from secondary markets such as DEXs, NFT marketplaces, or staking fees.
It appears feasible for TON to initially prioritize match-3 type games due to their competitiveness, the potential for revenue generation, and suitability for a “mini-game” format. Additionally, we can explore other genres, such as platformers, endless runners, card games, and simulators.
The traditional monetization models used in Web2 casual gaming could be enhanced by providing utility of the in-game assets outside of the game through token staking, yield farming, sale of NFT, and secondary markets for trading in-game assets. Additionally, play-to-earn mechanics and NFT ticketing for special game modes, tournaments, and events could be introduced to most casual genres, including match-3 games.

This public article results from an internal report conducted by The Open Platform.

Accelerating Blockchain Startups to Escape Velocity. https://top.co/

Our previous post introduced our readers to Telegram’s new Web3 Ecosystem. In the context of Telegram’s evolution into a comprehensive Web3 ecosystem, gaming, particularly through Mini Apps, emerges as one of its central pieces. This article explores the domain of casual Web3 games, emphasizing their compatibility with the Mini Apps format. The decision to focus on casual games is heavily influenced by their proven success within similar frameworks in major messaging applications, notably WeChat.

Continuing the exploration of Telegram’s Mini Apps in the context of casual Web3 games, it’s crucial to consider the inherent convenience of this format. The mini apps’ architecture eliminates the need for downloading separate applications, as users can access games directly within the chat interface. This feature significantly simplifies the onboarding process, making it more user-friendly, especially for those new to gaming or Web3 environments.

Games on Telegram are currently a highly trending topic. Many game developers, not limited to just Web3 games, are eager to publish their games in Telegram. There are several reasons for this, but Telegram’s massive audience of 800 million users and low penetration of games are major attractions.
Equally important is the integration of @wallet in Telegram, which opens up numerous opportunities for experimenting with new genres, monetization methods, and user engagement.
At TON Foundation, we receive a tremendous number of inquiries from game developers about what games to create for Telegram and how to seamlessly integrate them into TON and Telegram. This overview provides valuable insights, particularly for teams that are new to developing instant games on social networks and messengers, venturing into a new vertical for themselves.

Inal Kardanov, Gaming Lead at TON Foundation

By integrating games into the familiar interface of a widely used messaging app, Telegram effectively reduces barriers to entry and allows for seamless interaction with games in an environment where users are already engaged.

As per Telegram’s guidelines on gaming bots, this integration facilitates instant playability and encourages social interaction around gaming experiences. The Web3 monetization elements can add a new dimension to these interactions by allowing users to exchange assets with utility that is also present outside of the game.

A lot can be learned from Web2 gaming by Web3 developers, and the first step in building Telegram’s Web3 gaming landscape is to analyze the successes of similar games on other social networks. Understanding the revenue drivers in traditional gaming will inform our direction in the casual gaming genre. Then, we can explore how these traditional monetization models can be enhanced with Web3 elements. This strategic approach aims to blend proven gaming methodologies with the unique capabilities of Web3, redefining the casual gaming landscape in the process.

The Current State of Social Network Gaming

As we delve into the dynamic gaming world within social networks, we must consider the historical context and evolution of gaming on platforms like Facebook, WeChat, and TikTok. These case studies offer invaluable insights into the potential trajectory of gaming on Telegram. However, it’s important to recognize that Telegram’s journey will be distinctly shaped by its close ties with TON and its unique Web3 ecosystem. This connection to Web3 brings a new dimension to the gaming experience, one that is still learning and adapting from the foundations laid by Web2 gaming. This section explores how popular platforms have successfully integrated gaming into their ecosystems, providing a framework for understanding Telegram’s potential path in this evolving landscape.

Facebook Gaming

Facebook Instant Games is a gaming platform accessible directly within the Facebook and Messenger apps, offering a diverse range of free-to-play games that users can enjoy without the need for downloads or installations. Please note that gaming features are only accessible via the main Facebook app, but iOS and Android gaming are not available anymore (source).

Despite changes, Facebook Gaming remains popular, with major match-3 titles like Candy Crush Saga by King, Coin Master by Moon Active, and Homescapes by Playrix among the most played, reflecting a demand for casual “time-killer”-type games. Facebook Gaming has managed to secure a strong user base with 350 million monthly active users as of today.

WeChat Mini Games

WeChat Mini Games emerged in 2017, complementing the app’s mini-programs. The games offer casual gaming experiences perfect for social play and time-killing, enhancing the overall WeChat ecosystem.

Users can access games directly within the WeChat app without separate downloads or installations. WeChat provides a frictionless transition from chatting to gaming, boosted by social connectivity. Players can easily play with friends, share scores, and challenge each other, making the games more engaging and viral. This social aspect is a significant draw, as it taps into the existing relationships and networks on WeChat. The platform offers a diverse game library across various genres, catering to different tastes and preferences. From puzzle and strategy games to action and adventure, there’s a broad selection to keep users engaged.

WeChat’s mini-games alone draw a staggering 400 million monthly active users, cementing the platform’s dominance in China’s social gaming scene and illustrating the power of integrating gaming within a multi-purpose app.

VK Games

VK Games is a gaming platform integrated into the popular Russian social media network VKontakte (VK). It offers a wide variety of free-to-play and social games that users can enjoy directly within the VKontakte platform, allowing them to compete with friends and connect with other gamers.

With popular titles such as Spin the Bottle: Meet and Chat by Cyboma, boasting 30 million players, VK Games has carved out a formidable presence in social gaming, fusing the gaming experience with social interaction. Other notable titles are Pirate Treasures: Jewel & Gems by TAPCLAP and the Indy Cat series by PlayFlock, with the former boasting 50M+ downloads on Google Play. Both are match-3 puzzles with simple and addictive mechanics. The platform’s top games span genres from dating simulations to traditional card and puzzle games.

VK Games caters primarily to a Russian-speaking audience, with games that often include cultural references, language localization, and themes that resonate with this demographic. This localization makes the games more appealing and relevant to the VK user base.

TikTok Mini Games

TikTok’s new gaming pilot was quietly launched in mid-2022 with partners including game developers Voodoo, Nitro Games, FRVR, Aim Lab, and Lotum. At launch, the HTML5 gaming titles included Basketball FRVR by FRVR, Tap the Difference by Lotum, Peek-a-Who and Space Destroyer by Nitro, Pride Run and Influencer Run by Voodoo, and Mr. Aim Lab’s Nightmare by Aim Lab (source). There is also a TikTok exclusive title, Disco Loco 3D, by Zynga.

Later, in 2023, TikTok leaned further into games with a UK test of in-app minigames. The instantly playable games are accessible through a tapable box above the TikTok user’s name, according to mobilegamer.biz. The report mentions additional titles like Barricade Yourself Inside by Voodoo, Beauty Salon by Playable Factory, Color Galaxy by Gismart, Couple Challenge by Matchingham Games, Fortune Teller by Gamelancer, Kitten Force by FRVR, and Love Tester by Famobi. These titles fit into casual gaming format with genres ranging from infinite runners to space shooters and puzzles.

Douyin Mini Games

Games have been playable through Douyin, the Chinese version of TikTok, since 2019, according to scmp.com. Similarly to games on TikTok, titles like Yinyue Qiuqiu and Sheep a Sheep tap into the casual genre and explore the addictive puzzle mechanics, with the latter going viral in 2021.

Douyin’s gaming is strengthened by its publishing division, Pixmain, Danjuan Gaming’s platform, and Ohayoo, a casual game publishing platform owned by ByteDance, highlighting its commitment to controlling the gaming experience within its ecosystem.

QQ Games

QQ Games stands as a multifaceted entertainment portal by Tencent, offering a variety of social games alongside services like music and movies.

Integrating with Tencent’s messaging service adds a social layer to the gaming experience. This integration facilitates easy connection among players, enhancing the social aspect of gaming. Players can easily invite friends, join groups, or participate in community events, making the gaming experience more interactive and socially engaging.

QQ Games’ home page mainly features sports, simulation games, and fantasy-themed RPGs among the most played titles. A QQ account is also required to access major Chinese and Japanese MMORPGs, such as Moonlight Blade, Monster Hunter Online, Kritika, Lost Ark, and Saint Seiya Awakening: KOTZ.

Overall, except for games on QQ, most social network games are “time killers,” which include casual games, puzzles, runners, and sports. These games are often called “Mini Games” due to their simplicity. WeChat and Douyin adopted the concept of Mini Games, while TikTok is currently in the early stages of exploring this new market. Fantasy-themed RPGs also frequently appear among top games on social networks, such as QQ Games and WeChat MiniGames. None of the major players appear to be making an effort to appeal to the hardcore gaming crowd in the near future. Instead, they are choosing to focus on hyper-casual-style games.

Overview of the Top Casual Titles in Social Networks

This section will examine the monetization models of the top social network gaming titles. Notably, most of the mentioned games were released over the past five years but still rank high by MAU and revenue.

Match-3-type games stand out compared to other genres. They compete even with PUBG and Genshin Impact by mobile revenue while being significantly less complex in terms of gameplay and development. Sports/simulation games (especially card games and pool) and endless runners are also popular on social networks, but they lag behind in revenue. RPGs are leading on WeChat and QQ, while dating games are popular on VK. However, these genres are beyond our current focus.

If we define market leaders as developers of the most profitable games on social networks, then the top contenders would be King (Candy Crush Saga), Playrix (Gardenscapes, Homescapes), and Moon Active (Coin Master). Despite being older titles, they continue to dominate in MAU and revenue. Moreover, spin-offs based on these games are still being created.

Candy Crush Saga

Candy Crush Saga is a free-to-play tile-matching game developed by King and released in 2012. Players complete levels by swapping colored pieces of candy on a game board to make a match of three or more of the same color, eliminating those candies from the board and replacing them with new ones, which could potentially create further matches. Other King games like Bubble Witch Saga and Farm Heroes Sage have similar mechanics; however, they are lagging in terms of traction.

King’s monetization strategy involves freemium features where players can purchase in-game items like extra moves or lives. The game has generated considerable revenue, with a notable portion of players making in-app purchases. Notably, only 3% of users make in-app purchases (source).

Candy Crush Saga’s success is evident, with over 1 billion downloads and a high active user count, making it one of the most recognizable games in its genre. Candy Crush Saga is among the highest-grossing mobile games, with $592.75 million gross revenue in 2023 YTD (source), along with other major titles like PUBG and Genshin Impact. As of December 2023, it ranks 5th among all apps in the “casual” category in iOS and Google Play in the US (source) and 8th by revenue among all Google Play apps on data.ai with 69.96 million active users (source).

Coin Master

Coin Master is another match-3 type game, also called adventure, and a “social build-battler mobile game employing slot mechanics” (source). Coin Master was released in 2015 by Moon Active.

The players’ objective is to win coins to upgrade items to build up villages and progress through the levels. Similar to Candy Crush Saga, the game has a freemium model with in-app purchases offered in ten bundles of “spins,” “coins,” and other in-game assets and boosts.

The game also appears among the highest-grossing mobile games with $447.37 million gross revenue in 2023 YTD (source), ranks 2nd by revenue on data.ai as of December 2023, and has 23.33 million active users (source).

Homescapes

Homescapes is a popular match-3 puzzle game developed by Playrix and released in 2016. Players assist the game’s protagonist, Austin, in renovating and decorating his family’s mansion by completing various puzzle levels. The game combines traditional match-3 mechanics with a storyline and interior design elements, offering a unique and engaging experience. Homescapes has multiple spin-offs, including Gardenscapes, which follows a similar gameplay style but focuses on garden renovation and decoration.

The game features in-app purchases with in-game coins that can be earned or bought with fiat. As of March 8, 2023, Homescapes was downloaded more than 540 million times and has earned $2.5 billion in revenue (source). According to data.ai, the game currently has 9.31 million active players (source).

8 Ball Pool

8 Ball Pool, developed by Miniclip, is a widely acclaimed online multiplayer pool game released in 2010. It is available on multiple platforms, including iOS, Android, and web browsers. This game allows players to compete in 8-ball pool matches against others globally, offering a realistic billiards experience with a competitive ranking system.

Like other games in this list, 8 Ball Pool follows a freemium model with in-app purchases, including ten bundles of coins for buying mystery boxes, cue customization, and a VIP membership that provides additional perks.

8 Ball Pool has over 1 billion downloads on Google Play and 28.67 million active players (source).

Sheep a Sheep

Sheep a Sheep is a casual mobile puzzle game developed by Brilliant Games, released in 2022 for iOS and Android platforms, as well as WeChat and Douyin. The game, known for its simplistic yet addictive gameplay, involves players stacking sheep to build a tower, challenging their strategy and timing skills.

The game’s monetization sources are ads and in-game purchases, including the paid option to permanently remove ads, remove ads for seven days, a permanent VIP subscription, and the ”Battle Ticket.”

There is no public data on MAU or revenue; however, the game went viral in 2021 and brought much attention to WeChat mini-games, leading to 30%+ organic growth in 2021 (source).

Helix Jump

Helix Jump is an addictive, single-tap arcade game developed by Voodoo and released in 2018 for iOS and Android platforms. The game challenges players to navigate a bouncing ball through a spiraling tower maze, requiring precision and timing to avoid obstacles and reach the bottom.

Like Sheep a Sheep, Helix Jump is monetized through ads and allows players to purchase a “no ads” subscription. Additionally, players can buy revives.

According to the developer’s website, Helix Jump currently has over 100 million downloads on Google Play and 800 million downloads total. The game has over 2.33 million active users as of December 2023 (source).

Pirate Treasures: Jewel & Gems

Pirate Treasures: Jewel & Gems is a match-3 type puzzle game developed by TAPCLAP, initially made available for VK in 2013 and Android devices in March 2015. The game was later released on iOS platforms on November 30, 2018. Set in a vibrant pirate-themed world, it challenges players to match jewels and gems in classic puzzle game fashion, offering hours of engaging gameplay across various devices.

The game allows users to purchase ten bundles of coins, lives, weapons, and boosts. Pirate Treasures is one of the most successful games on VK, with over 23 million players representing more than 4% of VK’s total user base. Additionally, Pirate Treasures has more than 50 million downloads on Google Play.

Overall, most major casual titles on social networks adopt a freemium model, offering in-game purchases such as coins, asset bundles, and items. These purchases aid players in their gameplay and allow for personalization of their gaming experience. The next section will explore how Web3 elements can be incorporated into these monetization models.

Web3 Entry Points and Implications for Monetization

There is a lot of overlap between casual Web3 and Web2 games in terms of monetization due to similarities in in-game mechanics, such as stats, leveling, health/mana systems, as well as the ability to personalize the gaming experience by changing the visuals and stats of characters or items. See, for example, Dragon Strike and Meow Match as Web3 match-3 type games that incorporate monetization elements similar to those found in Candy Crush Saga or Gardenscapes.

Common monetization models used in Web3 games are in-game purchases of items, upgrades, repairs, and boosts; NFTs representing characters or items, as well as tickets to game events and tournaments; in-game NFT marketplaces; in-game DEXs; and staking. Unlike Web2 games, some Web3 games do not allow onboarding without purchasing an in-game asset, such as an NFT character, tool, pet, or other items. However, the main difference compared to traditional gaming is the ability of Web3 games to carry the value of in-game assets outside of the game, allowing for revenue generation from secondary markets, including DEXs, NFT marketplaces, or staking fees.

As of December 2023, several new GameFi projects appear in the top 10 by token market cap on CryptoRank:

Axie Infinity is a digital pet universe developed by Sky Mavis, where players collect, breed, raise, battle, and trade token-based creatures known as Axies. Its monetization model revolves around the use of in-game ERC-20 tokens, with players making transactions using AXS and SLP, earning through gameplay, and participating in the game’s economy, including buying and selling Axies and in-game assets on the game’s marketplace.
The Sandbox is a virtual world and a sandbox-type gaming ecosystem developed by Pixowl, where players can create, own, and monetize their gaming experiences. Its monetization model revolves around using SAND, its native cryptocurrency. It allows players to buy digital land and assets, engage in virtual real estate transactions, and participate in a decentralized economy, epitomizing the “play-to-earn” model, similar to Axie Infinity.
Decentraland is a decentralized virtual reality platform powered by Ethereum, developed by Ari Meilich and Esteban Ordano. As a virtual world game, users can create, experience, and monetize content and applications. The platform’s monetization model is based on the use of its currency, MANA, which players use to buy and sell virtual land and assets within the game, making it part of the “play-to-earn” genre.
Gala Games (game developers). Their portfolio includes a match-3 game, Meow Match. The monetization is comprised of NFTs representing “Meow Pets” and in-app purchases (”vault pack bundles”). Another match-3 project with RPG elements called Dragon Strike offers a VIP subscription and “Marketplace Bundles.” In-app purchases for both games are only available with fiat.
Illuvium, an RPG sci-fi game on Ethereum, is renowned as “the world’s first IBG (Interoperable Blockchain Game).” Illuvium features open-world exploration, an NFT creature collector, and an auto battler game. Illuvium has its own token ILV. Illuvium positions itself as a “fusion of DeFi and Gaming.” Users can stake their ILV and purchase game objects as NFTs that can be utilized across various games in the ecosystem. Illuvium has its own DEX called IlluviDex.

GameFi tokens significantly outperfomed the broad market (represented by BTC) in its recent rally. Source: CoinGecko.

dAppRadar features these games among those with the highest UAW:

Farmers World — a farming simulator with in-game currencies GOLD, WOOD, and FOOD used to create tools, repair equipment, and maximise stats. NFTs represent tools and provisions and can be bought with in-game currencies.
Untitled Platformer — a platformer with its own token UNT used for increased rewards, to mint NFTs (Bonus Characters), or to purchase in-game items.
Nine Chronicles — an RPG with a fantasy setting with its ecosystem token NCG, which can be staked, traded, used for crafting items, and accelerated growth.

Overall, the Web3 monetization mechanics run down to:

Purchase of items (characters, tools, weapons, etc.) with ecosystem token, as well as upgrades, improvements, and repairs of these items
NFTs as in-game assets (characters, tools, weapons, etc.)
NFTs as tickets (for events and tournaments)
Fees from in-game NFT marketplaces
In-game boosts with ecosystem tokens (level-ups, speeding up cooldown)
Deposits in gambling games
Fees from in-game DEX, where the token can be traded for common currencies
Fees from staking of the ecosystem token
Liquidity mining programs used to boost activity.

We can draw parallels between the leading Web2 titles and their closest Web3 analogs and offer some suggestions on how to diversify their monetization models with Web3 elements:

Wrapping Up: What Can We Learn from Web2?

Following the examples of market leaders, it appears feasible for TON to prioritize match-3 type games initially. This choice is driven by their competitiveness, potential for revenue generation, and suitability for a “mini-game” format. Additionally, we can explore other genres such as platformers, endless runners, card games, and simulators.

Games like Coin Master, Candy Crush, and Gardenscapes appear among the highest-grossing mobile games worldwide, alongside giants like PUBG or Genshin Impact. All three are casual-style match-3 games suitable for a “mini-game” format on Telegram and other social networks. We could replicate their success while dipping into similarly addictive genres, such as platformers, endless runners, card games, and sports games.

The monetization models of games like Coin Master, Candy Crush, and Gardenscapes could be easily enhanced with Web3 mechanics. For example, in-app purchases can be made with Toncoin or other jettons, and NFTs can represent characters or items, as well as subscriptions for special game modes (similar to “The Farm Season” in Homescapes) or access to tournaments if the game employs PvP elements. If an in-game token is launched, an in-game DEX can provide an additional source of revenue through trading fees. Similarly, fees can be earned through staking.

It is evident that Web3 casual gaming remains a relatively untapped market, with only a handful of casual titles making it to the top ranks. This presents an opportunity for Web3 game developers to learn from the success stories of Web2 gaming market leaders, charting a course that blends innovation with already proven strategies. The integration of Web3 elements combined with the social aspect of the messaging apps provides an additional dimension for engagement and revenue generation, that could reach far beyond what traditional casual gaming has already achieved.

Ready to start building crypto-friendly mini-games and unlock access to 800 million Telegram users? DM us on Twitter or visit our official website: https://top.co. Dive deeper into the world of Mini Apps at ton.org. Join the conversation and stay updated with the latest developments by following the official Telegram Mini Apps Twitter.