Global Game and GameFi Regional Market Report Series — Korea (Part 1): Actions of Traditional Game Giants

Asia Blockchain Gaming Alliance( ABGA ) — — A non-profit, blockchain alliance, co-sponsored by leading institutions in the gaming industry. We are optimistic about blockchain games, NFTs and Metaverse and we are taking the initiative to support ABGA related activities and investments.

Founded in 2015, Chain Capital is a new digital fund focusing on the investment of blockchain head project and the management of professional digital asset.

[Disclosure]: The information contained in this article is for reference only and does not constitute investment advice, and Chain Capital assumes no responsibility for the information or the results resulting from the use of the information.

1. Korean game market and blockchain game development process

1.1 Why choose the Korean game market

At present, the market value of the Korean game industry ranks fourth in the world, followed by the United States, China, and Japan. However, as the origin of e-sports culture and industry, South Korea has a unique environment for game development.

The prosperity of the Korean game field is inseparable from the enthusiasm of citizens and players for games, which we call the cultural value bonus. In addition, South Korea’s game infrastructure: such as Internet cafes, high-speed and stable network connections, and a developed mobile phone manufacturing industry. The above points are all catalysts for the development of the game. Several games with the highest civic engagement are League of Legends, Overwatch, FIFA Online, etc.

1.2 Overview of the Korean Game Industry

According to the content summary of the “2019 Korean Game White Paper”, the scale of the domestic game market in South Korea continued to grow from 2009 to 2018, except for a slight downward trend in 2013 (a year-on-year decrease of 0.3%), and has maintained a continuous growth momentum since then.

The size of the mobile game market exceeded that of PC games for the first time in 2017. In 2018, the sales revenue of the mobile game market reached KRW 6,655.8 billion, accounting for 46.6% of the total game industry sales revenue. The sales

revenue of PC games was 5,023.6 billion won, accounting for 35.1% of the total game industry sales revenue. The sales revenue of console games was 528.5 billion won, accounting for 3.7% of the total game industry sales revenue, up from 2.8% in 2017. According to market research, about 50% of South Korean citizens play games on their mobile phones.

As a country of origin of e-sports, South Korea has a unique and non-negligible branch of the game field is e-sports teams, and game live broadcasts. This feature has some differences with the traditional game field, and also represents an advanced game field trend.

1.3 Prospects from traditional games to GameFi

With the rapid development of blockchain technology and applications and the rise of chain games, we have begun to turn our attention to the local game manufacturing giants and their progress towards the blockchain based on the strong evidence supported by the above data.

We ranked the top 10 game companies in South Korea by early 2022, along with their development and prospects for blockchain, based on 4 criteria:

1. Funding

2. Market Opportunity

3. The innovation of service or product

4. Growth Potential/Scalability

2. The top 10 game companies in South Korea and the development process of the blockchain field

2.1 Overview

2.2 Project details

· Nexon Korea: $27 billion market cap

Founded in 1994, Lexian Co., Ltd. is a Japanese computer game operation company controlled by NXC of South Korea. The group’s game development is mainly undertaken by the original group company, Lexian Korea, and its subsidiaries are Nexon America Inc, Boolean Games.

(1) Main business: sports, RPG online games

(2) Representative works: “Dungeon and Warriors”, “Running Kart”, “Adventure Island” and other online games

(3) Development in the field of blockchain:

i. Acquisition of $100 million in BTC

ii. The parent company announced at the end of 2021 that it will accept cryptocurrencies for in-game assets in the future

iii. Blockchain games under development have not yet been announced

· NC Soft: $20 billion market cap

Enxi Software Co., Ltd. is an online game company in South Korea. It was established on March 11, 1997. Its main development direction is massively multiplayer online role-playing games. Headquartered in Seoul, it has subsidiaries and joint ventures in the United States, Europe and Asia, as well as Korean professional baseball NC Dinosaurs.

(1) Main business: RPG games

(2) Representative works: “Paradise” series games, “Sword Spirit”, “Aion” and “Guild War” series games

Gaming companies are in recession, losing $3.7 billion in market value last year.

(3) Development in the field of blockchain

Will launch NFT based MMORPG game in 2022

· Netmarble: $10 billion market cap

Netmarble Games is a video game development and distribution company founded by Fang Junxiao in 2000. It is headquartered in Seoul, South Korea and has more than 5,000 employees. In 2004, it reached a cooperation strategy with CJ E&M and became a subsidiary of CJ E&M.

(1) Main business: mobile games, Marvel series, competitive games

(2) Representative works: “Marvel’s Last Years War”, “The Seven Deadly Sins” series, “The King of Fighters: All-Stars”, “Seven Knights”

(3) Development in the field of blockchain

Announced in 2022 to launch its own game platform MBX to launch 6 P2E games, MBX platform will be based on Klaytn chain, then $MBX will be the MBX platform token.

· Kraftoon Game Union: With a market value of $9 billion, South Korea’s Blue Hole Studio was renamed Kraftoon

Headquartered in Bundang-gu, Seongnam-si, named in the style of KRAFTON, formerly known as Bluehole. Founded in Seoul in March 2007 by Chang Byunggyu, the company is best known for developing TERA, PUBG: Battlegrounds and NEW STATE MOBILE through its subsidiary PUBG Studios.

(1) Main business: RPG online games

(2) Representative works: “PUBG” (Jedi Survival), “Terra” (Battle of God’s Domain), “Eyelon” (Roian)

(3) Blockchain development plan

i. In March 2022, reached a cooperation with Solana Lab, and identified the follow-up chain game development platform as Solana

ii. Participate in investing in Korean local chain game projects such as “KlayDice”

· Pearl Abyss: Market value of $3.2 billion

Jane Abbys is a South Korean video game developer and publisher founded in 2010. The company is best known for its cross-platform MMORPG Black Desert and its upcoming open-world action-adventure game Crimson Desert.

(1) Main business: Massively multiplayer online RPG online games, fighting games.

(2) Representative works: “Black Desert”, “Red Desert”, “Shadow Arena”, “EVE Online” (Eve of Star Wars)

(3) Blockchain development plan

Started research and development of BlackSpace Engine, NFT and Metaverse Engine

· Gameevil Come2us: Market value of 2 billion US dollars, listed on the US stock market

Com2uS Holdings, a publicly traded company based in Seoul, Republic of Korea and Torrance, California, develops and publishes video games for mobile devices. On October 4, 2013, it acquired one of its main competitors, Com2uS.

Gameevil itself has more than 500 million mobile downloads, and in 2013 acquired its rival Come2us.

(1) Main business: RPG adventure games, stand-alone games

(2) Representative works: “Zenonia” (Zenonia series), “Baseball Star Dream” series, and Come2us’ representative work “Summoners War” (Summoning) (about 100 million downloads)

(3) Blockchain development

i. Cooperate with Terra Ecosystem to build the future game ecosystem on Terra chain, C2X plan, will issue NFT and tokens in the future

ii. Cooperation with TIKITAKA Crop, RPGRepublic Co. Ltd, DAERISOFT.

iii. Invested USD 28 million in Korean exchange Coinone

iv. The traditional game “Summoners War” is made into a chain game version, an idle card strategy game. Will be online in 2022

· Gravity: Market value of 1.2 billion US dollars, listed on the US stock market

Gravity Co., Ltd. is a Korean video game company established in 2000. Mainly known for developing the massively multiplayer online role-playing game Ragnarok.

(1) Main business: massively multiplayer online RPG online games

(2) Representative games: “Ragnarok” series (Ragnarok)

(3) Blockchain development

It has reached a cooperation with OnBuff, an American blockchain studio, to make a chain game version of the game Ragnarok. The game will be launched on April 27, 2022, with more than 1 million downloads and more than 700,000 registered users.

· Webzen: $1.2 billion market cap

Webzen, the full name of Webzen Global Digital Technology Co., Ltd. is a South Korean video game company, established in 2000, represented as the online game “Miracle”.

(1) Main business: large role-playing games, action games, mobile games

(2) Representative works: “Miracle MU” series

(3) Blockchain development

Announced in December 2021 to start planning to develop NFT, VR and metaverse scenarios. There is no news on Chain Tour yet.

· Smilegate: $1 billion market cap

Founded in South Korea in 2002, the company is the creator of CrossFire, the world’s top online FPS game with more than 6 million peer players worldwide. Its subsidiary We Made famous products include the “Legend” series of online games.

(1) Main business: multiplayer large-scale online RPG online games, action online games

(2) Representative works: “Crossing the Line of Fire”, “The Lost Ark”

(3) Blockchain development

i. Had an ICO in 2018. Cooperation with Korean public chain ICX

ii. The follow-up will be the revision and cooperation of chain games in 2022

· DoubleU Games: $1 billion market cap

Founded in 2012, it mainly produces various types of casino games.

(1) Main business: social online games, casino games, casual games

(2) Representative works: “Casino Slot Games”, “Double U Bingo”, “Double U Casino”

(3) Blockchain development

Invested $1.5 million in Epic Games.

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