What is Play to Earn? Play games to earn money & future trends
What is Play to Earn? Why playing games to make money has been around for a long time but is now booming?
What investment opportunities with this future trend?
Play to Earn is a very hot topic in recent times, stemming from the explosion of the game project from Vietnam, Axie Infinity.
Axie not only attracts a huge number of players from all over the world, but also shows everyone (crypto and non-crypto) the huge profit potential this market has to offer. With sales far exceeding all of today’s leading protocols, this will certainly be an attractive piece of cake for both users and the project side.
The following article will share with you about Play to Earn, the development potential of this market and what will come next as well as investment opportunities with this money-making gaming trend.
What is Play to Earn?
Play to Earn is a form of helping players receive a certain benefit or reward when participating in the game. In a word, Play to Earn is playing games to earn money.
Play to Earn has been around for a long time but why boom now?
Play to Earn boom comes with the advantages that Crypto brings, which include:
- Using NFT technology as leverage for the Play to Earn game group.
- True ownership.
Use NFT as leverage
NFT (Non-Fungible Token) is a unique token and cannot be replaced by other tokens. NFTs will represent different collectible items or assets, so NFT tokens are widely used by artists, illustrators or game developers to tokenize their products. .
Surely those of you who have been in the market for a long time will know that the potential of NFT is very large. Previously, most of NFTs were in the form of works of art such as paintings, photos, etc., what gives them value lies in (1) the story behind (2) the collectability, the purchase value. Gaming creates another value for NFT that is (3) applicability.
This greatly increases the reach for NFT, thereby expanding the potential market and moving towards the mainstream.
In the past, I played a game, owned a super rare skin and could be sold for a high value. But in an event, the publisher opened up the sale of that skin for an unlimited amount of 24 hours, and then his skin was almost worthless.
This is just a small example of the current state of the game, in-game items can only be traded within that game. All power belongs to the publisher, they can control the supply, use and value of the item, but not the player. And if that publisher goes bankrupt and closes the game, all the player’s values and efforts will be in vain.
Another example is the case of FiFa Online 3 upgrading to FiFa Online 4, players who deposit money into FiFa Online 3 lose all their deposit.
In contrast, by taking advantage of NFTs and their properties, NFT games help to solve the above problem and for the player:
- Real Ownership: The user owns the item in the form of NFT (token) and is certified by the Blockchain, so no issuer can take away the item, even if the server crashes. Items are tokens that allow users to trade with anyone in the world without being limited in the game as before.
- Reserve of value: NFTs are unique, the number of NFTs issued and their properties are fixed and cannot be changed. Therefore, there will be no chance of rare items becoming “less rare”. In addition, with more and more game ecosystems and different Dapps supporting NFT, their applicability is increasing, not just limited to a single game.
All the above advantages help the Play to Earn model – Playing games for money in the Crypto market really shines, users can confidently consider playing games as a real job to help generate income for themselves. Dear.
Axie Infinity – The one who paved the way for play-to-earn
In the “play-to-earn” video surveying people in the Philippines, Axie Infinity has really made waves in the country.
Low income and effects from Covid-19 forced them to look for another source of income and Axie was like a lifeline for the Filipino people.
In the video, we see a large number of players from the elderly to children of all walks of life who treat Axie as a daily job and this percentage is increasing.
With revenue outstripping all other dApps by weeks, Axie is a testament to the potential of Play to Earn, and has paved the way for other Play to Earn projects to learn from and perfect their products. me.
To get a correlative look at how far on-chain gaming can grow, let’s take a look at the value of the current gaming market.
According to Newzoo, one of the world’s leading gaming data collection sites, the gaming market is growing steadily every year. At the current average growth rate, this market could reach $200 billion with 3 billion players by 2023.
According to Newzoo, a game’s revenue (the amount a player is willing to spend in a game) can account for up to 77% of that game’s revenue.
Adding the total market capitalization of the current top 10 on-chain game projects (accounting for almost the entire market share of on-chain gaming), we find that the market for on-chain gaming is quite small and lots of growth potential.
However, Newzoo’s data above only covers the traditional gaming market, with Play to Earn, the Gaming market can grow much more.
Gaming will then be more than just a game, it can be real work and will be recognized by more and more people, like what Axie Infinity did to people in the Philippines in particular and the world in general.
Obstacles to overcome
Conditions to play the game
Although I have high expectations for on-chain gaming, there are still many barriers from a player’s perspective.
The first time I tried to download Axie, to be eligible to play (with 3 pets) I lost more than $700, but with this $700 I only received the weakest pets.
Trying to play the CryptoBlades game also costs me about $300/account, this amount is relatively if not too high for ordinary players.
To move into the mainstream and reach more players, monetized gaming should learn from traditional game models:
- Anyone can join.
- Almost completely free or just a low cost.
- Monetization can be flexibly integrated in the game.
The currency in the game should not fluctuate too much like current games (similar to Aavegotchi with the bonding curve model) to keep the GHST price stable and difficult to pump as strongly as Axie or My Neighbor Alice,… ).
Infrastructure for gaming
Axie using layer 2 Ronin is clear proof that developing games on Ethrereum is not a good idea.
To handle a large amount of transactions, and provide a smooth and low-cost game experience, the current Ethereum blockchain is completely inadequate. No player wants to spend tens of dollars and wait a few minutes for a transaction to play a game.
With more than ten years of experience playing games, I realize that there is still a pretty big gap between on-chain games and traditional games. Only a few titles have outstanding visuals and engaging gameplay.
Currently, there are a number of promising games with eye-catching visuals like Star Atlas on Solana, or The Ember Sword that are still in the development stage and have not announced a release date.
In short, gameplay will be something to improve if you want to really attract players, not just stop at normal speculation.
The future of Play to Earn
Is playing games for money just a fad?
Personally, I think with a potential market, create a real use case for NFT and most importantly help participants generate income. Play to Earn will not be a fad like trending food coins or animal coins.
Note: A prolonged trend does not mean that the price of game tokens will continue to rise from here on, Axie Infinity has been in development since 2018. In order for an AA game and more of AAA to be able to hit the market, usually it takes years as well as a lot of expense, and to generate real revenue is even more difficult.
Next, I will summarize some future trends for the Play to Earn trend.
The evolution of gaming
The NFT gaming space has actually been around for a long time with the launch of CryptoKitties in 2017, when players could only buy or hatch eggs to hatch NFT cats.
Then came the appearance of the second generation of games that we are playing, typically The God Unchained and Axie Infinity, now players can take their NFT to fight with other players, greatly increasing the character. game interaction.
In the next generation of games, games will solve the limitations of current games to help bring better experience and game quality to players. Players will be able to experience better gameplay, do not need to meet too high requirements to participate, the experience in the game is also fast and smooth.
You may find it a bit off topic, but it is highly likely that Storage will be an area that any on-chain game will need to pay attention to in the future.
Storing data on blockchains like Ethereum is extremely expensive.
According to Seba Bank, to store 1GB of data on Ethereum with 100 gwei gas fees would cost over 60,000 ETH in transaction fees. So instead of being stored on-chain, NFTs will only contain a link to the data stored at a certain server.
So, there is a possibility that the server will crash, NFTs now only contain a broken link and users will not be able to watch it (similar to you using a link to download a game or movie and after a while the link is broken. ). If this happens, the author will need to issue a new NFT to replace the old NFT and it is unlikely that the NFT will retain its original value.
Fun fact: Most games currently only store some data on-chain, most of it is stored on the server.
Therefore, I think that if the gaming and Play to Earn segments continue to grow, the Storage segment will be a gold-digging shovel from this trend.
The games and projects that apply decentralized storage projects such as Filecoin, Arweave, IPFS, … at the earliest will also significantly increase the probability of success compared to other competitors.
Learn more about Storage and all there is to know about Storage in DeFi.
Actually, there is no need to wait in the distant future, now this is a criterion for you to judge whether a game is actually building or not.
You may not have noticed, but randomness is a paramount thing in most games today. The “opening of the chest” and receiving random gifts is one thing that greatly increases the appeal of the game.
- League of Legends has treasure chests open.
- FiFa opens player cards,…
- Card games, betting, lottery, … if there is no randomness, the game will not ensure fairness for players, and we should not participate in games that have lost right from the start. when it started like that.
Blockchain game ?
A typical way for an on-chain game to integrate randomness is to use Chainlink’s VRF (verifiable random function). Games like Axie, Aavegotchi,… all have their own VRF integrated.
Talking about the principle is quite lengthy, but you just need to remember that VRF makes the game really random.
When you learn about a certain game project, one of the top priorities is to find out if the project guarantees this.
If you decide to use Chainlink’s VRF, it’s good, if not, you need to learn more carefully before investing.
Interoperable NFT means that NFTs can be used on many different platforms.
Let’s take the example of meebits, the project says that its NFTs can be represented in many different Metaverses. Characters meebits can adventure in Sandbox, Webaverse and other universes. The video below will give you a perspective on Interoperable NFT.
As mentioned in the beginning, the application of NFTs in many different platforms will increasingly increase the value of NFTs.
Interoperable NFT will make gaming more attractive than ever and thereby increase the attraction of money-making gaming.
However, at present, Interoperable NFT is still in its infancy, most of it is still just an idea, but there are no concrete results.
I will have a detailed article about Interoperable NFT for you when the time is right, projects that are implementing this idea should also be included in the watchlist.
Some complete Play to Earn games
Star Atlas is an online game with a galactic setting, in which you will put yourself in one of three factions and compete for resources, conquer territory, and dominate the game.
The special thing is that the game has two currencies, although it is not clear how it will be applied to the game, but the project itself has clearly recognized the limitation of letting tokens be the currency in the game. And with the shimmering images from the teaser, I have high expectations for this game.
Aavegotchi is a NFT project based on the Ethereum blockchain combined with Aave’s lending mechanism. What impresses me is that the project has recognized this problem for a long time and applied the bonding curve mechanism to the token issuance.
The higher the token price, the more tokens are issued, thereby increasing the supply and helping to stabilize the price.
Here are some of my thoughts on the Play to Earn model:
- Play to Earn or play games for money is a long-term trend and has great potential for growth.
- Currently, it is too hype when the number of games with products is small, the number of games that generate real revenue is even less, and the number of people who Fomo and ape-in all projects related to games is increasing. a lot of.
- Play to Earn still has a lot of room for improvement, but also creates many opportunities for those who know how to seize it.
What do you guys think about the play-to-earn trend? What are some good money-making tips or play-to-earn games that you would recommend?
Please comment below to share your opinion with Idolmeta.net!