Analysis of the Current State of the Gaming Industry and KGeN Platform

1. Introduction

In recent years, the gaming industry has faced severe challenges. After the growth during the pandemic, there has been a wave of layoffs and consolidations in 2023-2024, with rising development costs and decreasing investments. The difficulty of publishing has increased, AI content is rampant, platforms are saturated, and players prefer mature IPs, making it difficult for new projects to break through.

However, opportunities still exist. The consumption power of the digital native generation will drive market expansion. The long-ignored "Global South" market is experiencing explosive growth and will become an important incremental market in the next decade.

This report explores the latest challenges in game publishing and the growth opportunities in the "Global South," and analyzes KGeN, a blockchain-based platform that aims to reshape the incentive mechanisms between publishers and players. We will also assess the feasibility of Web3 task platforms and analyze the structural changes in the value distribution of the gaming industry.

2. Challenges Facing Issuance

One of the biggest challenges currently facing the gaming industry is distribution. Changes in consumer habits, regulatory adjustments, lower barriers to entry, and content saturation have made it difficult for new games to reach millions of users. The top ten games in 2023, based on monthly active users, have all been released for more than seven years.

The mobile gaming market once had a mature distribution model, but the adjustments to Apple's and Google's privacy policies in 2021 affected the way publishers reached users, impacting user acquisition strategies and business models.

While AI can improve UA efficiency, it also lowers the market entry threshold and exacerbates content oversupply. UGC platforms have become a testing ground for independent developers, but they also face challenges in content curation and promotion.

Web3 games still need to overcome additional barriers, such as stricter policy restrictions and certain market bans. The Web3 gaming market is relatively small, with about 6 to 7 million active wallets interacting with over 3,000 on-chain gaming protocols, but only about 200 of those protocols are truly active.

In the face of challenges, some Web3 companies are exploring new UA models based on blockchain. Innovative incentive mechanisms and on-chain reputation systems may become their competitive advantages. In emerging markets, businesses that can leverage blockchain global payment networks have significant opportunities.

3. Global South(Global South)

The Global South refers to regions that are relatively economically backward, usually located south of industrialized countries. Due to improvements in internet infrastructure, the proliferation of smartphones, and income growth, this vast area is seen as a gaming market with great potential.

Its characteristics include a large player base, a primary reliance on mobile devices, and an overall low willingness to pay. The younger generation is the first group that has grown up with smartphones and has a very high preference for game content. With economic development and increasing income, they may become the new generation of paying players, driving industry growth.

The following are some key market characteristics:

India

• In 2017, the number of players was 44.9 million, currently increased to 466 million, and it is expected to exceed 640 million by 2027.
• Market revenue is expected to grow by 13.6% to $943 million in 2024, surpassing $1 billion in 2025.
• Mobile games dominate, contributing 77.9% of total revenue
• Real money gaming is the biggest segment, with an annual revenue of $2 billion.

Southeast Asia

• In 2023, gaming revenue reached $5.1 billion, an increase of 8.8% year-on-year, and is expected to reach $7.1 billion by 2028.
• In 2023, there are 277 million players, expected to increase to 333 million by 2028.
• Indonesia has the highest mobile game downloads, while Thailand has the highest IAP revenue.
• Community and competitive culture are common characteristics.

Latin America

• In 2022, an estimated 316 million players were in Brazil, accounting for 101 million, generating $2.7 billion in revenue.
• 60% of players in Brazil have played mobile games in the past six months, and 43% have made in-game purchases.
• Brazil has 1,042 game studios, with total revenue of approximately $251.6 million.

Africa

• Revenue is expected to exceed $1 billion in 2024.
• Mobile games account for nearly 90% market share
• 92% of players use mobile devices to play games
• Main challenges: high data costs, hardware prices, network connectivity issues

Middle East and North Africa ( MENA )

• Revenue grew by 4.7% to $7.1 billion in 2023, exceeding the global increase of 0.6%.
• The compound annual growth rate is expected to reach 9.4% from 2024 to 2030.
• Saudi Arabia, the UAE, and Egypt are core markets, with a revenue of 1.92 billion USD in 2023.

4. Introduction to KGeN platform

KGeN is a blockchain-based gaming platform that promotes cross-game user participation through on-chain and off-chain data, incentive-based tasks, and a decentralized reputation system. Its core is a decentralized player data network covering millions of micro-game communities, using the "Player Proof" ( PoG ) engine to create a cross-chain player reputation layer.

KGeN provides publishers with a highly engaged target user base at a lower cost than many existing platforms. Since January 2024, registered accounts have grown by over 700%, monthly active users have increased by 1333%, and the total data attributes have grown by 992%.

The KGeN ecosystem is gradually becoming decentralized, protecting the PoG engine through a distributed oracle network, providing greater transparency for key stakeholders. The oracle network and KGeN store are both driven by KGEN tokens.

4.1 Grassroots Growth

The core of KGeN's growth lies in grassroots tribes and the network of tribal leaders. The tribes represent thousands of micro-communities that join the ecosystem. As of December 2024, KGeN has 2,525 tribes, of which 152 have more than 100 members.

The tribe is the core way KGeN promotes user acquisition based on recommendations. About 1.7 million KGeN accounts ( verified through KYC account for 39% of MAU, and 13% of total registered accounts ) are acquired through the tribe. Tribe leaders not only bring in new members but also need to maintain community engagement to maximize profits.

The largest market for KGeN is India, but over 30% of independent active wallets and transactions occur on Kaia, demonstrating its strong growth potential in Asia.

4.2 KGeN Play incentive participation

KGeN Play is the front-end interface participated by most players, where all reward tasks are published. Users earn rewards by completing K-Drops and K-Quests, building their PoG reputation score.

4.3 PoG Engine

The PoG engine is a decentralized player rating system, consisting of five core pillars:

• PoH( Human Proof ): Tracking User "Humanized" Data
• PoP( game proof ): determine platform participation and game preferences
• PoS( Skill Proof ): Acknowledgement of player abilities and achievements.
• PoC( Commercial Proof ): Identify User Monetization Potential
• PoSN( Social Network Proof ): Mapping User Social Profiles

The PoG engine currently has over 270 million data attributes, sourced from more than 13 million registered accounts and 4.4 million MAU.

4.4 KGeN token economy

KGeN economy includes two assets: KCash and KGEN. KGEN is the core utility token, with 40% allocated to community distribution.

4.5 oracle network

The KGeN oracle network is a distributed network that constitutes the backbone of the PoG engine. The oracle stores PoG data, calculates scores, and submits them to the blockchain. Operators earn KGEN tokens and stablecoin rewards.

5. Competitive Landscape

5.1 Representative of Web2 Field

• Facebook: In-depth user profile analysis, accurately reaching high-value users
• Applovin: End-to-end data integration, providing industry-leading advertising optimization
• Mystplay: Reward-based UA platform, AI-driven recommendation engine

5.2 Web3 Competitive Landscape

Mainly divided into two categories: publisher ecosystem and task platform.

• Publisher Ecosystem: platforms like Ronin, Immutable, etc., provide token subsidies to support UA
• Platform: Competing directly for user attention with KGeN

5.3 Competitive Analysis

Key Competitive Metrics: Total Potential Rewards ( TPR ) and Platform Locked Value ( LPV ).

KGeN leads in the number of registered accounts and MAU, with PoH and PoP as its unique advantages. The community reward distribution ratio of 40% is at a high level in the industry.

6. Future Opportunities

• Optimize the incentive mechanism, balancing external rewards with intrinsic motivation.
• Enhance monetization capabilities, improve PoC dimensions
• Expand KGeN Store, promote on-chain transactions
• Enhance data capabilities and establish unique competitive barriers.
• Improve attribution and AI technology stack

7. Conclusion

KGeN is the largest player database in the Web3 gaming sector, with a competitive growth flywheel. It has a first-mover advantage in the Global South market.

In the future, it must be proven that growth can be maintained after the token issuance to become the preferred UA solution. Monetization capability and data capability are key, and the UA model needs to be optimized, accelerating the development of AI and data tools to remain competitive.