TON becomes a sanctuary for small game developers in China: reigniting with the WeChat Mini Program route

From the traditional gaming winter to the confusion of blockchain gaming, and now to the rebirth of the TON Chain.

Just before meeting me, Xiao Ze had just finished meeting with a client, negotiating the sale of a small game source code he had developed. Compared to last year, Xiao Ze's demeanor at this meeting was completely different. He no longer appeared despondent, but instead full of ambition, like a teenager returning to his youth. Last year, he confided in me about his confusion and helplessness while working on a large-scale blockchain gaming project, "I've been in blockchain gaming for three years, and I haven't achieved anything. It's very different from my original ideals when I entered the industry. It might be a midlife crisis. I realized I'm already in my thirties and haven't accomplished anything, which feels like a failure." Half a year later, he finally found his groove and chatted with me with a smile throughout. It is said that many TON Chain gaming platforms have recently contacted them, wanting to buy their small game source code, with the highest bid reaching $100,000. The TON Chain is a blockchain project developed by Telegram. Although the Telegram team withdrew from the project's development midway, the TON Foundation took over and continued to develop it. Starting with last year's trading BOT, the TON Chain has gradually prospered, providing more opportunities and possibilities for today's small game BOT.

A traditional game developer who has experienced two winter seasons has also encountered challenges in the blockchain gaming industry."You may not be aware, but the traditional gaming industry actually began to experience a downturn in 2018, although at that time, most people were not conscious of it," Xiao Ze, who has been involved in game development for nearly 10 years, started working at a small to medium-sized traditional game company. Since the introduction of the game version approval policy in 2018, the number of domestic game version approvals has continued to decline, hitting the pause button twice, leading to what can be described as two winter seasons for those in the gaming industry. "At that time, everyone also said, the higher you stand, the harder you fall. At the end of 2018, Tencent's stock plummeted, evaporating over 80 billion U.S. dollars in market value," recalled Lao Si, a former Tencent employee, vividly remembering that time.

"Starting from the third month of the suspension, everyone gradually became pessimistic and negative. What was frightening was that no one knew how long we had to hold on," Xiao Ze recalled, showing me his negative circle of friends from back then. At the beginning of the suspension, no one thought that the deadline would last for 8 months, nor did anyone realize the extent of the impact it would have, but the domino effect had already quietly begun. The suspension of game approvals in 2018 directly or indirectly led to the closure of at least 1,000 new games in the industry, with over 600 game companies closing within the year. According to enterprise check data, by the second half of 2021, more than 14,000 domestic game-related companies had been deregistered. "This impact lasted for many years; the game company I was in kept laying off employees, and eventually, it couldn't hold on any longer, which led to me being unemployed for the first time," in 2021, Xiao Ze also became one of the thousands of game industry employees who were laid off. "That should have been five or six years ago, but I remember it very clearly; that was the low point of my life. I thought I might not be able to make games in the future, and I cried a lot," he said he cried for a whole two weeks, "I cried every day for two weeks, I did nothing, I was very anxious, and I didn't know what to do."

Blockchain gaming, a "refuge" for "game refugees"Amid the policy winter, game developers began to explore new paths. At the time, all game developers were faced with only two options: one was to focus on creating high-quality games. Faced with version restrictions and intensified market competition, game companies realized that only by improving the quality of their products and creating high-quality games could they survive in the market. The pursuit of high quality not only involves improving the graphics and gameplay of games but also requires extreme attention to game design, user experience, content creativity, and other aspects to meet players' high demands. However, for most small and medium-sized companies, focusing on high quality is not an easy path. High quality means needing more and better resources concentrated on a few games, and it also means that competition in the domestic game market will become more intense.Therefore, going overseas is the only remaining option and the choice of more companies. "Perhaps it was a second chance given to me by fate. After being laid off, due to my good English, I was brought by a previous leader to a game company with resources to tap into the overseas market," Xiao Ze was able to continue making games. "Tencent has also done a lot of overseas business, focusing a significant portion of its resources on this, including creating overseas versions of games, setting up offices overseas, and directly acquiring and investing in overseas game companies," analyzed Lao Si, believing that because Tencent controls most of the industry resources, Tencent's stock price returned to a peak in 2021. During that time, Tencent's merger transactions set records, with Timi Studios establishing offices in Los Angeles, Seattle, and Montreal, owning Riot Games, Funcom, and Sharkmob, as well as holding shares ranging from 4% to 84% in Remedy, Epic Games, Activision Blizzard, Ubisoft, Krafton, Supercell, Frontier Developments, and other companies.

Three years later, the ceiling for blockchain games is still Axie from that yearUnlike gaming giants like Tencent, small and medium-sized game developers venturing into blockchain gaming have not had an easy journey. In terms of channels, promotion, revenue sharing, and other aspects, game developers need to invest a significant amount of resources, which small and medium-sized companies lack. Nevertheless, some small and medium-sized companies have still attempted to enter the overseas market. However, they have encountered many obstacles and challenges. Due to a lack of experience and resources in the overseas market, they faced various difficulties when entering new markets, such as cultural differences, different laws and regulations, and challenges in local operations.It was precisely at this time that "blockchain gaming" broke through. This concept, which seemed unfamiliar at the time, not only attracted the attention of many major game developers but also unexpectedly became a "refuge" for these "homeless" game industry professionals. After two years of accumulation, the Ethereum-based "blockchain game" Axie Infinity exploded in May 2021, showing exponential growth in daily revenue. By August, monthly revenue had surpassed $334 million, far exceeding the revenue scale of Honor of Kings in July, which was $231 million.

"In fact, Tencent also had plans to develop Web3 games at the time, and many domestic companies, such as Ching Ming Bao, were also developing metaverse concept games," Lao Si told BlockBeats. There are many ways to go overseas, but blockchain gaming may have been the best choice at the time. This emerging form of gaming attracted a significant amount of capital investment and allowed some professionals to continue developing in the gaming industry. "It seems that we chose blockchain gaming at that time, but in fact, blockchain gaming chose us," in Xiao Ze's memory, blockchain gaming attracted many professionals who had been hit by the traditional gaming industry, hoping to rejuvenate through blockchain gaming. "However, three years have passed, and nothing has changed; the ceiling for blockchain gaming is still Axie from that year." What seemed like a revitalizing choice at the time has now left Xiao Ze feeling more complex; he feels he has taken a detour for three years. Blockchain game players are mostly speculators with strong motives, mainly for making money, lacking interest in the games themselves, and having low concern for the long-term development of games. Therefore, for speculative Web3 players, blockchain gaming initially requires high initial investment, including time and transaction costs. Traditional game players find it difficult to integrate into blockchain gaming due to high learning costs. Given these reasons, according to CoinGecko's report, from 2018 to 2023, the average annual failure rate for Web3 games is as high as 80.8%, a statistic that is not surprising.

Finally, blockchain gaming is also experiencing a "turnaround"Xiao Ze had not opened his social circle for half a year because his classmates, relatives, and friends were doing better than him, which made him uncomfortable. "I was thinking, should I have given up making games when I was laid off back then?" "Large-scale blockchain games are the second pitfall that game developers have fallen into, with the first being becoming a game developer," Xiao Ze said he would go out to drink to vent his frustrations when he couldn't bear it anymore, but every time after drinking, those thoughts would flood his mind. When he was laid off five or six years ago, Xiao Ze was still relatively young, but now things are different as a family man, he has many things to consider, including the lack of understanding from his family and the "contempt" from former colleagues, leaving him in a difficult situation in game development.Unlike the anxiety and confusion he felt when abandoned by the traditional gaming industry, Xiao Ze has experienced more despair in blockchain gaming...Feeling despair is not unique to Xiao Ze. According to Xiao Ze, most people around him have already left blockchain gaming ahead of him, including Tencent, and those remaining are on the verge of leaving. At the beginning of 2022, the hopes and dreams of most blockchain game developers were about a world without dominant platforms like Apple or Steam. They envisioned a decentralized world where anonymous community members could influence the development of their favorite games. Of course, this dream was somewhat naive and lacked a solid foundation. Having the right distribution method is crucial to the success of a game. Developing an excellent game does not guarantee success; you need to find a large number of users interested in playing your game and willing to pay for it. In the past, Steam and Epic were traffic gold mines for distributing PC and console games, and the App Store and Play Store were traffic gold mines for mobile games."Having no centralized review platform is a good thing, but from another perspective, blockchain gaming has never had a suitable platform to attract users," in three years, Xiao Ze participated in the construction of five or six blockchain gaming projects, but they were all different from what he initially imagined. Now, Xiao Ze has lost his fascination with blockchain gaming; he doesn't believe blockchain gaming can produce a game that people will play, at least not in the next five years. Until this year, after visiting Wutai Mountain with his family, Xiao Ze's miserable life finally began to turn around. Because earlier this year, a click game called Notcoin on the TON chain gained popularity.

Players can earn tokens through simple clicks; the operation is simple, easy to learn, and spreads quickly, making it suitable for playing in fragmented time. The gameplay of Notcoin is simpler than Snake; you just need to keep clicking. This low-threshold game design allows users to quickly get started with almost no learning costs. After its launch, Notcoin quickly attracted a large number of users.Currently, Notcoin has over 5 million daily active users and monthly revenue exceeds $300,000. This achievement rapidly accumulated a large user base in a short period, showing Xiao Ze more possibilities. "It feels like I've been swimming in the sea for a long time, and just when I was about to lose strength, the TON chain pulled me ashore." After connecting with some friends who make games on the TON chain, Xiao Ze finally discovered the huge business opportunities here.

Starting with Notcoin, more Tap to Earn games went online, and gameplays gradually diversified. For example, the most popular blockchain game project currently, Catizen, allows players to merge two low-level cats into a higher-level cat through a Telegram bot, attracting more users to earn money by playing with cats.

By the end of June, Catizen announced that its total user base exceeded 20 million, with over 250,000 daily active players, consistently ranking first in The Open League leaderboard for three seasons. Monthly revenue has also surpassed $500,000. These games are not only easy to understand but also operate in fragmented time, significantly increasing user stickiness. Although everyone knows that the data disclosed by projects may be biased, the fact that the number of players and games on TON is increasing is indisputable.More importantly, blockchain game developers have finally found their traffic gold mine. Telegram's user base has brought tremendous potential user base for the TON chain. Compared to WeChat's 1.1 billion active users, Telegram's 900 million users are slightly fewer. However, due to Telegram's global reach and high user engagement, games on the TON chain are easier to spread and promote. Not only small game developers like Xiao Ze but also the small game market on the TON chain has attracted more traditional game companies, bringing previously shelved domestic small games back into the spotlight.

Traditional game developers join the TON ecosystemAfter working on several Web3 projects, Sunny has now shifted her focus to TON games, with several small game projects under her leadership in progress and operation, including a shooting game. "Recently, I have been chatting with various traditional game companies, and they are all very interested in the current small game market on the TON chain, including Shanda Games," Sunny revealed to me. It is well known that Shanda Games is invested in by Tencent, and according to Lao Si, one of Shanda's data centers mainly focuses on mining. At the same time, Lao Si indirectly confirmed Sunny's statement, stating that not only Shanda but also Glacier, Weiyoo, and Sanqi, these Web2 game companies, have started projects in the TON ecosystem. It can be seen that these traditional game companies entering the space is quite effortless because they have been observing and seeking opportunities in the industry for a long time, and participating in TON chain games is not surprising. "As for Tencent, I think the likelihood of them directly getting involved is relatively low; Tencent may let its subsidiaries or invested companies like Shanda handle it," according to Lao Si, Tencent might also allocate some resources to support these companies, including those involved in WeChat mini-games. "If Tencent really gets involved, no one can do it better than Tencent. But the problem is if Tencent does get involved, wouldn't that just be dressing up Telegram as a bride for traffic?" Lao Si believes that supporting Shanda in developing TON games is already Tencent's biggest compromise. "Everyone is eager to push small games onto the TON chain. For example, those games that were abandoned in the past or those that were developed but couldn't be launched." Recalling the previous cycle, Sunny mentioned that traditional game companies were considering participating in GameFi, but due to the lengthy process of GameFi, they were hesitant to invest. "But with small games, one company may have several hundred or even thousands of them in hand, and everyone wants to rush in." Returning to the beginning of the article, the process of obtaining a license for game development in China is arduous, with various approval processes requiring a long wait. However, TON chain has no such limitations, and with the backing of Telegram's 900 million active users, this is a significant traffic gold mine. "The cycle logic of Web3's massive adoption is not feasible in this round, but small games are feasible, as are mini-apps." Like Xiao Ze, Sunny also believes that large-scale blockchain games will not have a chance in this cycle. "If the emphasis is on massive adoption, GameFi is a false proposition; the time has not come yet; we'll see in the next round." "Blockchain gaming may have been the best choice at the time, but the timing for large-scale blockchain games has not yet arrived. I don't think it's anyone's fault; it's just the choice of the industry and the market." Lao Si also revealed to BlockBeats that some large blockchain games that have burned through their funds are considering tweaking their code to release a TON small game to warm up or showcase some data and achievements before seeking funding for a large game again.

Let's start with something small; don't think about changing the world yetAs more people play games on the TON chain, Xiao Ze is beginning to produce dopamine again, rediscovering his past passion and drive. "In the past, everyone wanted to do something big, something great that could change the world, so small games have always been discriminated against until NOTCOIN became popular on TON." Indeed, the small game market seems straightforward; fundamentally, it retraces the paths of PC and mobile games, allowing previously popular game genres to rise again. Web3 small games are even simpler, following the paths of WeChat mini-games, reviving games that were once popular on WeChat's bestseller list.

Although most TON games on the market currently lack playability, with more developers and major companies joining, it is believed that we will soon see games on TON that were once bestsellers on WeChat, such as "Xundao Daxian," "Salted Fish King," "Yang Lege Yang," "Happy Elimination," "Plants vs. Zombies," "Defend the Radish," and even "Arknights." "When I sold my first small game last month, I immediately started calling my former colleagues and friends who were working on large blockchain games to confirm that my idea of making games on TON was correct. Now, I am very happy, extremely happy." At this point, Xiao Ze received a call from his development colleague, confirming some code details. Before leaving in a hurry, I said to him, "Your situation is completely different from last year; it's like a rebirth." Xiao Ze waved his hand and said, "I'm just not pretending anymore. Whether it's the game industry or the blockchain industry, you don't necessarily have to do something big to be really cool. Just start with something small, so just to hell with huge games." Special thanks to all the interviewees for providing information. For privacy protection, some interviewee information has been blurred.