Gaming is always considered as something to take your mind off a hard day’s work. But now, as a new type of video games using blockchain technologies has emerged, gaming is not simply for entertainment, but already a way to make a living. These so-called play-to-earn games are now proved to be the next generation of the gaming field.
What are play-to-earn games?
Simply put, P2E games are video games where players can receive rewards with real-world value. Each game’s mechanism can differ, but the rewards commonly come from staking, farming a game’s currency, or generating tradeable NFT items, that can later be converted into a fiat currency.
Unlike in regular games, where in-game items are held on walled-off data networks and owned by the companies that created the game, NFTs enable players to own unique assets that can freely be sold outside of the platform where it was created. That means in-game items can be traded and sold for fiat currency on any NFT marketplace.
P2E games also have their own in-game economies and business models where players can work for more income.
How do developers and players make money from P2E games?
For developers, they usually make money in two ways:
Firstly, is from the tokens or NFTs new gamers purchase to participate in the game.
Axie Infinity, as an example, requires new participants to purchase Axies, characters in the game, before joining, usually costing from US$10 to US$1,000.
Another way the developers can make money is through transaction fees on the secondary market within the game. NFTs can be bought, sold, and traded between gamers, and developers will take profit from those transactions.
About gamers, they can earn money through buying and selling in-game NFTs, or through taking part in other elements of the game.
What are the most popular P2E games at the moment?
Axie Infinity is no doubt the largest game in the space. According to a recent report by NonFungible, Axie Infinity seems unbeatable when accounted for nearly two-thirds of all NFTs transactions in the entire blockchain game market in 2021.
Launched in 2018 by Sky Mavis, a Vietnamese video game development company, the game is highly inspired by the cult classic “breed and battle” game Pokemon. Its NFT marketplace has recently surpassed $1bn trading volumes, according to Semper Fortis.
The Sandbox, which is the combination of Minecraft and Roblox, is taking place in the 2nd spot. In this game, players create worlds, arrange adventures, and create their own games which can all be monetized. SAND, in-game currency, is up by over 13% in the past 24 hours. As per CoinMarketCap, SAND is positioned at the 34th spot with a total market capitalization of $3.6 billion.
Closing thoughts
Play-to-earn games are a new term when it comes to earning with cryptocurrencies. We can’t deny the tremendous profits and all potential these games bring. However, investors should always be careful, because earning in game is still high risk and unsustainable due to bad tokenomics, or even scams.