Challenges and Opportunities in the Gaming Industry: How KGeN is Reshaping User Acquisition

1. Introduction

In recent years, the gaming industry has continued to grow in scale, but it also faces many challenges. After the pandemic, the industry experienced layoffs and consolidation, rising development costs, and decreased investment. The difficulty of game publishing has increased, making it harder for new projects to stand out.

However, opportunities and challenges coexist. The digital natives will continue to drive market expansion, and long-ignored emerging markets are now experiencing explosive growth.

This article will explore the latest challenges in game publishing, analyze the high-growth opportunities in emerging markets, and focus on KGeN, a blockchain-based gaming platform, assessing its potential to reshape the incentive mechanisms for publishers and players.

2. Challenges Facing Issuance

One of the biggest challenges in the current gaming industry is distribution. Factors such as changes in consumer habits and lower market entry barriers have made it increasingly difficult to successfully promote new games.

Players tend to spend time on familiar games. In 2023, the top ten games by monthly active users were released more than seven years ago. In 2024, games released that year accounted for only 15% of the total gaming time of players.

The mobile gaming market once had a mature distribution model, but the adjustment of privacy policies in 2021 has had a significant impact on user acquisition strategies. Small teams are facing greater competitive pressure.

While AI can improve UA efficiency, it can also lower the market entry barriers. UGC platforms face challenges in content screening and promotion, and the widespread adoption of AI will further exacerbate these issues.

Web3 games still need to overcome additional obstacles, such as stricter platform policies and bans in certain markets. Currently, there are about 6 to 7 million active wallet addresses interacting with over 3,000 on-chain game protocols, but only about 200 protocols have more than 100 active on-chain accounts.

Emerging ecosystems have intensified challenges. In 2024, 104 new networks/ecosystems will be launched, but only 263 new Web3 games will be released. This has led to a battle for player liquidity.

Some Web3 companies are exploring new UA models based on blockchain, gaining competitive advantages through innovative incentive mechanisms and on-chain reputation systems. In emerging markets, these enterprises may have significant growth opportunities.

3. Global South(Global South)

The Global South refers to countries and regions with relatively low levels of economic development. Due to improvements in internet infrastructure, the proliferation of smartphones, and income growth, this region is becoming a game market with enormous potential.

The characteristics of the gaming market in the Global South are: a large player base, a primary reliance on mobile devices, but overall willingness to pay is relatively low. The younger generation has a high preference for game content, and as the economy develops, they will become the new generation of paying players.

India(

India is rapidly emerging as the largest gaming market in the Global South. The number of gamers was 44.9 million in 2017 and has now increased to about 466 million, with an expected rise to over 640 million by 2027.

Market revenue is expected to grow by 13.6% in 2024 to reach $943 million, and to exceed $1 billion in 2025, reaching $1.4 billion by 2028, with a 5-year CAGR of 11.1%.

The Indian market has a strong preference for mobile games, benefiting from the rapid development of 5G and digital payment infrastructure. The internet penetration rate has increased from 14% in 2015 to the current 52%, and there is still significant room for growth.

Composition of revenue in the Indian gaming market:

• Real Money Games ) RMG ( annual revenue of 2 billion dollars
• The total revenue of casual and hyper-casual games is $700 million
• The market size of other category games is approximately 400 million USD.

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) Southeast Asia ( SEA )

Southeast Asia is one of the most mature gaming markets in the Global South. In 2023, the region's gaming revenue reached $5.1 billion, a year-on-year increase of 8.8%, and it is expected to reach $7.1 billion by 2028, with a 5-year CAGR of 6.7%. In 2023, there are 277 million gamers, and this number is expected to increase to 332 million by 2028.

Indonesia has the highest mobile game downloads, reaching 2.4 billion times. Thailand has the highest IAP revenue, reaching 400 million dollars.

Community and competitive culture are common characteristics of the region. The proliferation of smartphones and the development of broadband infrastructure are key factors driving market growth. It is expected that by 2026, the average smartphone penetration rate will reach 90.1%.

Latin America ( LATAM )

Latin America is another market worth paying attention to. In 2022, there were an estimated 316 million gamers, with Brazil having 101 million players, generating 2.7 billion dollars in gaming revenue.

The Brazilian market has a strong preference for mobile games, with 60% of players having played a mobile game at least once in the past six months. 43% of players have made in-game purchases.

Brazil will continue to dominate the growth of the gaming industry in Latin America, thanks to a well-established gaming education system and policy support.

非洲(Africa)

The African gaming market is at a critical development stage, with revenues expected to exceed $1 billion in 2024. Mobile games account for nearly 90% of the market share.

The main challenges include high data costs, hardware prices, and network connectivity issues. Payment systems are both a challenge and an opportunity, with significant differences in payment methods across different regions.

Middle East and North Africa ( MENA )

MENA is the fastest-growing gaming market in the world, with a revenue growth of 4.7% in 2023, reaching 7.1 billion USD. The CAGR is expected to reach 9.4% from 2024 to 2030.

Saudi Arabia, the UAE, and Egypt are the core markets in the region, with projected revenues reaching $2.9 billion by 2027, at a CAGR of 8.3%. A high proportion of young people, increased internet penetration, and the adoption of new technologies are the main driving factors.

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4. What is KGeN

KGeN is a blockchain-driven gaming platform that leverages on-chain and off-chain data, an incentive-based task platform, and a decentralized reputation system to promote user engagement across different games. KGeN returns publisher funds to users, driving the growth flywheel.

The core of the platform is a decentralized player data network that covers millions of micro-game communities ) KGeN Tribe (. This network uses "Player Proof" ) Proof of Gamer, PoG ( engine to create a cross-chain player reputation layer, providing publishers with a highly engaged target user group.

Since January 2024, KGeN has shown significant growth: the total number of registered accounts has increased by over 700%, monthly active users )MAU( have grown by 1333%, and the total data attributes have increased by 992%.

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

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) 4.1 Grassroots Growth

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

The tribe is one of the core ways KGeN promotes user acquisition based on referrals. About 1.7 million KGeN accounts that have passed KYC verification ( account for 39% of MAU and 13% of the total registered accounts ) were acquired through the tribe.

KGeN's largest market currently is India, but over 30% of independent active wallets and transactions occur on Kaia, indicating that KGeN has strong growth potential in Asia.

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) 4.2 Incentives for participation through KGeN Play

KGeN Play is the front-end interface where most players on the platform participate, and all reward tasks are published here. Users earn rewards by completing tasks while building their own PoG reputation score.

KGeN Play can be accessed through the PC portal or mobile app. When users create an account, the system automatically creates a blockchain wallet in the background to store user assets and non-tradable player reputation NFTs.

The task activities are divided into K-Drops and K-Quests. K-Drops provide automatic real-time verification through API integration, while K-Quests are conducted through a manual verification process.

4.3 PoG Engine

The PoG engine is a decentralized player scoring system hosted by a network of distributed nodes. PoG consists of five core pillars, each containing five to ten attributes that track players' skills, "humanity", engagement, wealth, and social networks.

The five core pillars are divided into:

• Proof of Humanity ( PoH )
• Game Proof ### PoP (
• Skill Certificate ) PoS (
• Business Proof ) PoC (
• Social Network Proof ) PoSN (

The PoG engine currently consists of over 270 million data attributes, coming from more than 13 million registered accounts and 4.4 million MAUs.

Using the PoG engine, KGeN is leading the "Effective Customer Acquisition Cost" ) eCAC ( alternative UA framework. KGeN only charges active users who reach the middle or bottom of the user funnel.

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) 4.4 KGeN Token Economics

KGeN economy includes two core assets: KCash and KGEN tokens. KCash primarily serves as an off-chain asset for reward currency and can be used for purchases in KStore.

The KGEN token is a utility token that drives the growth of the KGeN ecosystem. The community allocation accounts for 40%, and the team and investors have a four-year lock-up period.

rKGEN airdrop activity. The distribution of rKGEN is based on the total amount of K-Points held by users, their time on the platform, and relevance. Once the token is launched, rKGEN can be converted to KGEN tokens at a 1:1 ratio.

In addition to direct token consumption, there will also be token staking. Tribal leaders can stake tokens to increase the member limit and gain additional platform tools. Publishers can also participate in a tiered staking program to acquire more free funnel top users in UA activities.

4.5 Oracle Network

The KGeN oracle network is a distributed network composed of permissioned nodes, forming the backbone of the PoG engine. Each oracle is responsible for storing PoG data, calculating PoG scores, and submitting the scores to the Aptos blockchain for settlement.

Another core component of the oracle network is the oracle key. The key is the NFT required to participate in the network. The more an authorized oracle operator spends on their oracle license, the more keys they receive.

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