Following the month-long competition, 14 teams emerged victorious, winning a chance to collaborate with Trilitech’s Business Development teams and bring their innovations to the Etherlink mainnet.

The hackathon, organised in partnership with Encode Club, attracted developers worldwide to build on Etherlink’s high-performance infrastructure. 

Projects leveraged Layer 2’s sub-500ms confirmations and near-zero transaction costs to create applications spanning from generative art platforms to AI-powered development tools.

“This was our first hackathon for Etherlink, and the response from builders has been phenomenal,” said Adebola Adeniran, Developer Relations Engineer at Trilitech and hackathon mentor. 

“We received nearly 100 submissions, with standout projects emerging across DeFi, Art, Gaming, and AI. Several teams will be selected to collaborate with our Business Development teams to bring their ideas to life on the Etherlink mainnet.”

Permalink claimed both the Best Overall Project award and first place in the Collab Culture category for its fully on-chain generative art platform. Permalink was created by a digital artist for the digital art community. 

The platform empowers artists to easily experiment with AI and algorithmic techniques, making it simple to generate unique works and mint them as NFTs.

In the DeFi category, Stack won first place for its gamified, mobile-first Web3 investment platform targeting Gen Z users. The application enables fractional investment in real-world assets and stocks for as little as $1, with automated investing through daily habits. 

Runner-up Superlink presented a mature DeFi vault project with strong community engagement, while MeshPay secured third place for enabling offline blockchain-based payments in emerging markets.

“Etherlink’s developer experience has been smooth and powerful. Its EVM compatibility allowed us to use familiar tooling (Hardhat, Viem, Solidity) while benefiting from the performance and low-fee characteristics of Tezos’ L2. 

“We’re especially excited about Etherlink’s focus on real-world utility and believe it’s one of the best environments to launch community- or data-driven protocols like Foretell,” said the builders working on the project Foretell. 

The gaming category showcased innovative approaches to on-chain entertainment. Etherlink Bounce To Earn GameFi took first place for delivering a playable, engaging experience, while Seas of Linkardia earned second place for excellent onboarding and UI/UX design, scalable for both Web2 and Web3 users.

The Vibecode wildcard category highlighted creative applications of blockchain technology. Time Stone won for its innovative app that lets users lock files until a chosen point in the future, ensuring they can only be accessed later. 

The app uses decentralised time oracles and cryptographic encryption for security. Etherlink Agent Kit secured second place for integrating LangChain capabilities with a comprehensive SDK for account, token, NFT, and chain operations.

Special recognition went to Tickity for the Community Choice Award, recognising its mobile ticketing concept, and FOMO Insurance received the Judges’ Choice Award for its innovative DeFi insurance approach.

Winners of the Etherlink Hackathon 2025 will receive mentorship and additional funding opportunities as they develop their projects for mainnet deployment.

The collaboration between hackathon teams and Trilitech’s Business Development division aims to accelerate the transition from concept to production-ready applications.

With all of the turmoil happening around us, it can be difficult to see positive developments happening in the space, one of which is the increasing investments in and the gradual evolution of the blockchain gaming (GameFi) industry.

After the NFT craze of 2021, many metaverse projects saw a dramatic uptick in users and revenue during that time. However, as the bear market has ensued from the start of 2022, the GameFi space has also taken a hit, with many popular Play-to-Earn games reporting record low revenues, as indicated by GameFi NFT trade volumes for Axie Infinity and others.

Although there are some real challenges to be solved, it’s clear that VCs see beyond short-term hurdles, as is indicated by the accelerated investments in the space. In Q2 of 2022 alone, $2.5 billion was invested in GameFi, indicating a huge leap compared to 2021’s aggregate investment of $4 billion – and this year is still not over!

So then the question needs to be asked – is GameFi dead, or is there true potential for blockchains to revolutionize the gaming industry and absorb at least some of the current $220 billion (and rapidly growing) gaming market?

What is GameFi?

GameFi is a portmanteau of the terms “game” and “decentralized finance,” and it refers to a financial system in which users can earn money by participating in video games. While most play-to-earn projects place emphasis on the “gaming” aspect, the most critical aspect of GameFi at its foundation is “money”. Its beauty lies in the financial opportunities provided by a highly viewed form of entertainment – gaming.

While GameFi has shown  a slight decline compared to its popularity earlier in the year, it was definitely the highlight of 2021, growing from 658 projects to over 1,100 projects in one year. The gamification of blockchain made the technology more approachable, appealing and acceptable for the public,

GameFi – Challenges Abound, But So Are Opportunities

Before we discuss the future prospects of GameFi, we have to acknowledge the challenges currently faced in the GameFi sector. For anyone involved in crypto, it won’t come as a surprise to find out that the public perception of GameFi is not great – hostile even. And a good amount of that negativity is not without merit.

Public Image Issues

The biggest challenge by far will be to convince traditional gamers of the underlying true value of NFTs. Not for their perceived and oft-reported highly speculative value, but for their digital scarcity, provable ownership, security and programmability that enables in-game assets to be used far beyond their main purposes.

The 2021 NFT Cambrian explosion led to an immense crypto adoption and made a lot of people wealthy. But it also left some pretty big scars after the market cooled down; countless stories of project rug pulls by anonymous operators and celebrities, and NFT newcomers getting scammed are still circulating the news. 

Mainstream gamers still need to be convinced that the web3 space can tackle the challenge of building a self-sustaining game economy. One that gives the players a chance to decide whether they want to play the game for free and for fun, or whether to take it to the next level and earn an income from it.

Free-to-Play – Adjusting Course for the Better

To draw inspiration for how to structure and monetize a game, the web3 gaming industry need not look further for its most ideal strategy than the one that’s been right in front of their eyes for more than a decade – Free-to-Play. Countless titles, such as Candy Crush, Farmville, Roblox, Pokemon GO, League of Legends and many more, have proven to the world that free-to-play games can be highly lucrative without setting up paywalls for their users, sometimes even more so than paywalled games.

The F2P mechanism flips P2E on its head – instead of letting whales hoard all of the in-game assets and generate passive income, F2P games let them bring in 80% of the revenues through Pay-to-Win (P2W), which allows players to pay for in-game advantages.

These P2W features are typically low-cost small advantage boosts such as resource packs, gacha characters, healing boosters and more. But in the aggregate, these small payments compound into enormous profits for the game.

It works for everyone – most players get to play the game for free, big players get to accelerate their in-game success, and the game itself generates more revenue than it knows what to do with.

And this realization is one of the reasons why more and more investments are flowing into GameFi. Though it had a rocky start, the value proposition of NFT-based games is clear – every single aspect of traditional F2P games is made simpler and safer. In addition, every in-game NFT asset can be added to a highly liquid global market of all NFT assets, offering ways to trade NFTs from different games, as well as build in utility for them in order to grant unique capabilities, access rights, invites and more. And if that’s not enough, on-chain data also shows a clear trend – gaming activity currently accounts for 52% of all Unique Active Wallets (UAW), a 232% increase from last year. The numbers speak for themselves — the opportunity offered by blockchain gaming is immense, and investors are paying attention.

The Path Forward for GameFi – Keeping It Simple

In the past years, the approach taken by many blockchain game projects has been to advertise their games to crypto-natives, typically with the express aim of offering earning opportunities for players. As a result, we’ve mostly gotten games of subpar quality that have served players mainly as profit extraction vehicles with limited long-term sustainability, especially during bear markets when hype and liquidity are low.

This may not be the end of the GameFi sector just yet, however. The newer form of web3 gaming has started to practice patience, build a great, addictive game, and quietly build all of the exciting and innovative web3 features into the backend of the game without making too much fuss about it.

The industry is steering away from P2E, embracing Free-to-Play with Pay-to-Win as a sustainable means of monetization.

Attracting talent from traditional gaming and finally forcing large game studios to build blockchain tech into their backends are all crucial pathways to making a blockchain-based gaming future a reality.

However, these great leaps will not happen out of thin air — a lot of capital will need to be deployed over many years.

Luckily, companies such as Immutable X, the NFT-gaming optimized Ethereum L2 startup, have launched a $500 million development fund to invest in GameFi. Solana Ventures has also amassed a $100 million fund to invest in GameFi and DeFi targeting South Korea. And they’re not alone. More than $10 billion is expected to flow into GameFi this year alone. 

The amount of capital invested perfectly demonstrates the potential these firms see in the upcoming, more improved version of GameFi.

With this amount of capital, and GameFi’s tendency to revamp, improve and further develop its new generation of play-to-earn games, it’s a matter of when, not if, blockchain gaming will become the norm in the future.

Article developed by Boxmining