Cryptogaming: Play to Earn or Play and Earn?
The last year has seen an incredible boom in the blockchain gaming sector, a genre of games where players can spend their time and resources to collect rewards that can then be traded using cryptocurrency (Bitcoin, Ethereum) channels. Axie Infinity, a game designed by Vietnamese developers Sky Mavis is one of the most popular blockchain […]
The last year has seen an incredible boom in the blockchain gaming sector, a genre of games where players can spend their time and resources to collect rewards that can then be traded using cryptocurrency (Bitcoin, Ethereum) channels.
Axie Infinity, a game designed by Vietnamese developers Sky Mavis is one of the most popular blockchain games as its players can buy specific avatars and items in the game to then mint and collect non fungible tokens (NFTs) as they play and progress. The popularity of Axie Infinity in the last year had seen its players trade digital assets worth USD 2.5 Billion by September 2021.
Today, there are close to 400 games that use blockchain technology and promise their players a gameplay experience that allows them to “play to earn” (P2E).
Play to Earn or P2E seems the next logical step if you consider the intertwining of the gaming industry with cryptocurrency and decentralized finance. Gaming has always been a computationally demanding activity and if valuable resources like electricity, time, and computing power (key resources for crypto mining) are used to navigate gaming worlds then it seems logical that they could be used to mine artifacts and rare items in games.
Blockchain gaming combines the architecture of cryptocurrency with the open markets for skins and cosmetic items that multiplayer games have perfected to try and allow players to earn money from their playing pursuits.
P2E isn’t a unique idea in gaming as games like World of Warcraft have had systems where players could earn in-game rewards to pay for their monthly subscriptions for a while. However, this comes garbed in the lustrous promise of cryptocurrency and NFTs and an exchange market that allows players to cash out their in-game rewards. The implementation of this promise is likely to be the most challenging aspect if blockchain gaming is to succeed.
There are two broad dimensions at play here and both are equally important if P2E is to go mainstream.
The quality of games
Games are fundamentally fun activities and they need to remain fun for players to stay engaged and immersed. Axie Infinity is a fun game with its Pokémon based style but a lot of the other blockchain games at this point are copies of Axie and that is a poor indicator for the genre.
If games lack fun and get repetitive then play transforms into work and as gamers are a smart community how long before they find ways to circumvent the process? Isn’t the fun and the experience the unique differentiator for Blochain gaming from conventional mining of crypto?
The NFT economy
This dimension is more challenging as the NFT economy is based on scarcity and ownership. In other words, an NFT holds value as long as it is one of a kind, for this to happen players need to receive unique NFTs from their games and the valuation of these NFTs needs to be carefully managed.
For example, if every player were to receive the same NFT for clearing a level then that NFT would hold negligible value as there would be simply too many of them. Leaving us to wonder how would these NFTs be rewarded? Would they be at random, specific, skill-based, or auctioned? There is simply too much here that is still unclear.
The P2E economy of games has been recently heralded by many as the successor to free-to-play (F2P) and Pay2Win but it seems difficult to find differences at this juncture as both P2E and Pay2Win are based on the same financial mechanisms. Add to this the sudden crumbling of global interest in NFTs all doesn’t seem hunky-dory for blockchain gaming.
For now, I believe games must remain fun, leisure time activities.
