The video game consolidation boom got supercharged in the first quarter, as companies turned to mergers and acquisitions in a bid to diversify and expand amid tighter competition. 
A new report from DrakeStar Partners, an investment bank that closely tracks the sector, said $98.7 billion in deals were announced or closed in the first three months of the year. That's compared to $85.4 billion in deals for all of 2021 and $32.7 billion for 2020.
Take-Two Interactive, the company behind Grand Theft Auto, kicked off the year with its $12.7 billion acquisition of Zynga, the mobile game developer behind Farmville. Microsoft was up next with its record-breaking $68.7 billion planned acquisition of Activision Blizzard, and Sony capped off the trio of mega-deals with its $3.6 billion purchase of Bungie.
In this photo illustration, a Bungie Inc. logo of a video game developer is seen on a smartphone screen and PlayStation (PS) logo in the background. (Photo Illustration by Pavlo Gonchar/SOPA Images/LightRocket via Getty Images)
While those three deals alone make up the lion's share of the quarter's M&A activity, the buying spree has continued through the year. There were 82 gaming M&A deals in Q1, compared to 68 in the last quarter of 2021, and more deals are on the horizon. 
Former U.S. PlayStation chief Jack Tretton is currently raising money through a special purpose acquisition vehicle, or SPAC, to purchase a game company in the one to two billion-dollar range. If he succeeds, that deal will rocket into the top five of the year so far. 
In addition, private capital is flowing into the industry at a steady clip, providing the fuel for future M&A deals. Venture capital and strategic funds invested a "record-breaking" $3.4 billion in the space through 287 deals, according to DrakeStar. 
Blockchain games also made a showing, raising $1.2 billion in the quarter. This emerging category of games is merging free-to-play titles with NFTs and cryptocurrencies —  a controversial but potentially highly lucrative combo of recent technology trends. 
Indeed, a new report from crypto analytics firm DappRadar and the Blockchain Game Alliance puts that number even higher, with the crypto games raising $2.5 billion this quarter.   
The report also noted that blockchain gaming activity increased 2,000 percent from last year, and now makes up the bulk of blockchain activity and NFT trading volume. 
Michael Metzger, a partner at DrakeStar, said the surge in investment hasn't translated into M&A activity yet, but consolidation could be on the horizon as the space matures.