YGG winds down gaming division: 35 layoffs and a pivot towards the AI economy
Yield Guild Games (YGG) has announced the closure of its publishing division YGG Play and the layoff of 35 employees. The company is reallocating resources to develop a data economy for artificial intelligence (AI). This decision is a direct consequence of the prolonged crisis in the crypto market, which has fundamentally changed the behavior of retail traders.
The YGG Play.fun platform, including the launchpad and games such as LOL Land and Waifu Sweeper, will be completely shut down by August 1. Meanwhile, the Web3 versions of the GIGACHADBAT and Ragnarok Breaker projects will continue to exist within their own studios.
The reason for such a radical move is a deep market correction that began in October of last year, when over $19 billion in leveraged positions were liquidated in a single day. Selling pressure persisted into 2026. Bitcoin (BTC) repeatedly fell below the $60,000 mark, and many leading altcoins lost 80% or more of their value.
Despite YGG Play's revenue reaching $9 million by the end of the first quarter of 2026, the company states that the market crash on October 10 permanently altered user behavior. YGG does not expect crypto and Web3 gaming markets to recover to their previous volumes in the foreseeable future.
"Furthermore, the entire market for game publishers is currently in a very difficult state. Given this combination of circumstances, we must acknowledge that YGG Play cannot remain commercially viable in the current situation. Therefore, the decision has been made to close the YGG Play business unit," the company stated in an official announcement.
New Direction: From Games to AI Datasets
YGG's management considers this step necessary to focus efforts on a more stable long-term business. The company's mission is to create opportunities through technology, and now all resources will be directed toward the data economy for AI. The first product will be a B2B solution based on gaming datasets.
"This choice directly places us in the global AI dataset market—an industry valued by Grand View Research at $3.9 billion, with demand for specialized data types just beginning to grow," the company emphasized.
YGG joins a growing list of cryptocurrency companies that are either downsizing their business or pivoting to AI development amid the market downturn. Earlier in May, the online analytics platform Dune Analytics announced a 25% staff reduction, focusing on AI development and working with institutional on-chain data.
My commentary as an analyst: YGG's shift from games to AI is not just a forced measure but a strategically sound move. The market for gaming datasets for training neural networks is in a stage of explosive growth, and YGG has unique experience in collecting and verifying data through game mechanics. If the company can convert its gaming expertise into high-quality B2B products for the AI industry, this could become a new growth point. However, the loss of 35 experienced employees is a serious blow to expertise, and the success of the transformation will depend on how quickly YGG can restructure its team for new tasks.