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

1. Introduction

The gaming industry has surpassed the scale of movies and music, but it faces severe challenges in recent years. From 2023 to 2024, the industry is experiencing a wave of layoffs and consolidation, with soaring development costs and significant reductions in investment. Game publishing and distribution are becoming increasingly difficult, with an oversaturation of AI content, saturated platforms, and players favoring established IPs, making it hard for new projects to stand out.

Nevertheless, there are still huge opportunities in the industry. Gen Z and Gen Alpha, as digital natives, will continue to drive market expansion. At the same time, the "Global South" market is experiencing explosive growth and will become an important incremental market for the gaming industry in the next decade.

This report will explore the latest challenges in game publishing, analyze the high-growth opportunities in the "Global South," and focus on KGeN—a blockchain-based gaming platform aimed at reshaping the incentive mechanisms between publishers and players.

2. Challenges Faced by the Issuance

One of the biggest challenges in the current gaming industry is distribution. Changes in consumer habits, adjustments in regulatory policies, lower market entry barriers, and content saturation have made it increasingly difficult to successfully promote games.

Players tend to spend most of their time on familiar games. In 2023, the top ten games ranked by average monthly active users were all released over seven years ago. In 2024, despite Steam welcoming 19,000 new games, the games released that year only accounted for 15% of the total gameplay time.

The mobile gaming market once had a mature publishing model, but the privacy policy adjustments in 2021 have significantly impacted user acquisition strategies. Small teams are facing greater competitive pressure.

AI may significantly increase the quantity of content, exacerbating the challenges of content filtering and promotion. Web3 games also face additional obstacles such as stricter policy restrictions and bans in certain markets.

The Web3 gaming market is relatively small, with around 6 to 7 million active wallet addresses interacting with 3,000 on-chain gaming protocols. The surge in the number of emerging networks has intensified the competition for player liquidity.

Against this backdrop, a number of Web3 companies are exploring new user acquisition models based on blockchain. Innovative incentive mechanisms and on-chain reputation systems could become potential competitive advantages for these companies.

3. Global South(Global South)

The Global South refers to countries and regions with relatively low levels of economic development, usually located south of industrialized nations. These areas are rapidly becoming a market with enormous potential for gaming, characterized mainly by:

• Huge player base
• Mainly rely on mobile devices for gaming
• Overall willingness to pay is relatively low.
• The younger generation has a high preference for game content.

The following are some key market characteristics:

India (

• The number of gamers has increased to about 466 million, and it is expected to exceed 640 million by 2027.
• The market revenue is expected to grow by 13.6% in 2024, reaching $943 million.
• Mobile games dominate, contributing 77.9% of total revenue.
• The rapid proliferation of 5G networks and the improvement of digital payment infrastructure.
• The economy continues to grow at a high speed, and the income level of the middle class is rising.

) Southeast Asia ### SEA (

• Game revenue in 2023 reached 5.1 billion USD, a year-on-year increase of 8.8%.
• Expected to grow to $7.1 billion by 2028, with a 5-year CAGR of 6.7%
• In 2023, there are 277 million gamers, expected to increase to 332 million by 2028.
• Community and competitive culture are common features.
• The penetration rate of smartphones is high, expected to reach 90.1% by 2026.

) Latin America ### LATAM (

• In 2022, it is estimated that there were 316 million gamers, with Brazil accounting for 101 million.
• Brazil generated $2.7 billion in gaming revenue in 2022.
• 60% of Brazilian players have played a mobile game at least once in the past six months.
• 43% of Brazilian players have in-game purchase behavior
• Brazil is strongly supporting the development of the gaming industry by providing tax incentives and other measures.

) 非洲###Africa(

• Revenue is expected to exceed $1 billion in 2024.
• Mobile games account for nearly 90% of the market share
• 92% of players use mobile devices to play games
• Main challenges: high data costs, hardware prices, network connectivity issues
• The payment system is both a challenge and an opportunity, with a high penetration rate of mobile payments.

) Middle East and North Africa ### MENA (

• Revenue grew by 4.7% in 2023, reaching 7.1 billion USD
• Expected CAGR of 9.4% from 2024 to 2030
• MENA-3) Saudi Arabia, UAE, and Egypt ( are core markets, with revenue expected to reach $2.9 billion by 2027.
• A high proportion of young population drives market activity.
• Widely adopted new technology

![Let gamers prove: how KGeN redefines user acquisition])https://img-cdn.gateio.im/webp-social/moments-d3de399cfffbeb740364dfae15a2686b.webp(

4. Introduction to 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 drive user engagement across different games. The core of the platform is a decentralized player data network, utilizing "Player Proof" ) Proof of Gamer, PoG ( engine to create a cross-chain player reputation layer.

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

The KGeN ecosystem is gradually decentralizing, protecting the PoG engine through a distributed oracle network and providing greater transparency to core stakeholders. Both the oracle network and the KGeN store are powered by KGEN tokens.

![Let gamers prove: how KGeN redefines user acquisition])https://img-cdn.gateio.im/webp-social/moments-6a684309a3a50aa2f2837ee493f7bb42.webp(

) 4.1 Grassroots Growth

The core of KGeN's growth is its grassroots tribes and tribe leader network. The tribes represent thousands of micro-communities that join the ecosystem. As of December 2024, KGeN reports having 2,525 tribes, of which 152 have more than 100 members.

The tribe is the core method for KGeN to drive user acquisition based on recommendations. Approximately 1.7 million KGeN accounts verified through KYC were acquired through the tribe. Tribe leaders are incentivized to introduce new members and maintain community engagement.

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.

![Let gamers prove: how KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-d5024d3244e8e06eb832353ce147bd10.webp(

) 4.2 Incentivize participation through KGeN Play

KGeN Play is the front-end interface that most players on the platform participate in, where all reward tasks are published. Users can access it through the PC portal or mobile application. When an account is created, the system automatically creates a blockchain wallet in the background to store user assets and non-tradable player reputation NFTs.

Users primarily earn rewards by participating in K-Drops and K-Quests. K-Drops provide automatic real-time verification, while K-Quests use a manual verification process.

![Let gamers prove: how KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-0edfaf9accefa4de93c0fa72feaa027c.webp(

) 4.3 PoG Engine

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

• PoH### Human Proof (: Tracking Data Points to Reduce the Possibility of Robots
• PoP) Game Proof (: Determine players' engagement with the platform and their gaming preferences.
• PoS) Skill Proof (: Recognizing player abilities and achievements
• PoC) Commercial Proof (: Identify users' monetization potential
• PoSN) Social Network Proof (: Mapping the Scale of User Social Profiles

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

![Let gamers prove: how KGeN redefines user acquisition])https://img-cdn.gateio.im/webp-social/moments-e150f998ddcdedf65ff8cbb46b3245f9.webp(

) 4.4 KGeN Token Economics

KGeN economy consists of two core assets: KCash and KGEN tokens. KCash serves mainly as an off-chain asset for reward currency, while KGEN tokens are the utility tokens that drive the growth flywheel of the ecosystem.

rKGEN airdrop activity. rKGEN can be converted to KGEN tokens at a 1:1 ratio. Some users will be able to start staking rKGEN before the TGE to earn additional token rewards.

![Let gamers prove: how KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-238d7cd2ae2476494e3b286b5e1f8c37.webp(

) 4.5 Oracle Network

The KGeN oracle network is a distributed network composed of permissioned nodes, forming the backbone of the PoG engine. The task of the oracle is to store PoG data, calculate PoG scores, and submit the scores to the Aptos blockchain for settlement.

The decentralization of the oracle network will be a gradual process, expected to take at least three years. The oracle key is the NFT required to participate in the network and will be tradable when the network transitions to the second phase.

![Let gamers prove: How KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-1bbf9a79a3f9f248f26bc4a103343da8.webp(

5. Competitive Landscape

) King of Advertising Technology: Past and Present

In the Web2 market, Facebook and Applovin are two typical examples:

Facebook:

• Find a foothold at the end of the web game era and the rise of mobile.
• In 2014, it occupied nearly 30% of the mobile advertising market share.
• The core value lies in accurately identifying and reaching high-value users.

Applovin:

• Highly mature advertising technology platform
• There are layouts on both ends of the mobile advertising market: supply-side platform MAX and demand-side platform AppDiscovery.
• The core is the machine learning engine AXON, which combines user behavior data with platform bidding data.

Mystplay:

• One of the fastest-growing reward-based UA platforms in the Web2 space
• With approximately 16 million registered users, the MAU exceeds 2 million in 2023.
• The annual income is expected to be around 55 million US dollars.
• Mainly aimed at the first-tier markets in Europe and America, adopting a "quality over quantity" strategy.

![Let gamers prove: How KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-e8095eedec89550374d875044adc7f91.webp(

) 5.2 Web3 Competitive Landscape

The competitors in the Web3 market are mainly divided into two categories: publisher ecosystems and task platforms.

Web3 Publisher Ecosystem:

• Represents: Ronin, Immutable, Xai, and Catizens
• Mainly through token subsidies or inflation for UA incentives
• The profit model is based on the fee structure of developer activities.

Task Platform:

• The core advantage lies in aggregating tasks from multiple projects to provide a one-stop experience.
• KGeN has a strong community base and first-mover advantage in India and Brazil.

![Let gamers prove: How KGeN redefines user acquisition]###https://img-cdn.gateio.im/webp-social/moments-198dbe74f4481de6eb6598db203ce74a.webp(

) 5.3 Competitive Analysis