Play-to-Earn (P2E) games are early-stage metaverse platforms that add innovative economic models that allow players to earn a steady income for playing. These games are usually powered by a blockchain, offering rewards and incentives to users based on their platform activity or related in-game achievements. As users earn cryptocurrency based on their gaming activities, they can exchange them for fiat or other assets on exchanges. Play-to-earn games could bring digital identity, assets, and ownership into players’ hands as the gaming industry is becoming decentralized. This is how modern video games may introduce new paradigms that lend themselves to a wide variety of emerging digital environments and forms of value creation. These games are also spearheading a recent development: the increasing convergence of the physical and digital worlds. The true innovation lies in the decentralized integrity and security of these digital items, which—for the first time—can transcend the traditional proprietary, custodial ownership, and discretion of a company or even government.
As an example, instead of relying on the permission or rules of publishers or other third parties, in-game resources from play-to-earn games can be sold freely on marketplaces both inside and outside of the game. For now, it is worth noting that play-to-earn games do not inherently and fully eliminate the centralization found in games: they still require the authority of the publisher to define, issue, and constrain the asset that eventually is traded as an NFT. Rather, the greatest promise of play-to-earn games is in their potential to decentralize marketplaces for the creation, ownership, and exchange of digital assets, as well as the potential created when these marketplaces are connected to the traditional economy and fiat currencies—allowing players to transfer their digital time, effort and earnings into disposable income in the physical world.
Owning and participating in core pieces of these new worlds brings great financial returns to those who believed; many of whom will be from emerging markets who were quick to move on the opportunities available. For the players themselves, the play-to-earn model may represent a new and flexible way to make money. But beyond questions around financial reporting and taxation, it also reflects some of the perils associated with the digital economy, which risks creating “humans as a service”: limited job security, precarious relationships between firms and employers, and a lack of social safety nets. Given that freelancers are already overrepresented in the creative economy; these will all be considerations that policymakers will have to take into account. For this reason, we have an interview with Alireza Mehrabi, an entrepreneur and cryptocurrency analyst, to find out his opinion on the smart contract.
Play-to-earn gaming as the job board for the ‘metaverse’
While play-to-earn is still an emerging niche, it could redefine more than just the gaming landscape. We make the case that it has the potential to change how people interact with and perceive traditional socioeconomic structures like financial institutions, marketplaces, and governments. This is because play-to-earn games provide a proof of concept for a self-sovereign financial system, an open creator economy, and universal digital representation and ownership that lend themselves to a wide variety of emerging digital environments and forms of value creation. It seems that play-to-earn games are spearheading a larger trend at play: the increasing convergence of the physical and digital worlds. And with that, the emergence of the legendary ‘metaverse’—which has been as much at the center of the recent academic debates as it has been the stuff of rejuvenated corporate agendas, most prominently that of Meta (née Facebook). Enticed by visual impressions drawn from Neal Stephenson’s 1992 novel ‘Snow Crash’ or movies like ‘ReadyPlayer One’, most discussions of the metaverse centeraround technical details, functional attributes, or end-user implementations in the form of high fidelity 3D and extended reality headsets. But instead, the metaverse may quite simply be the point in time for human society in which digital identity and assets are more meaningful than their physical counterparts. As metaverse startup Koji quick-wittedly points out, through this lens, our transition to the metaverse becomes a socioeconomic shift as a consequence of technology and connectedness. As humans, we value objects and experiences we live in a world and a moment in time in which those objects have been assigned value by society. The metaverse marks the moment in time in which digital assets, experiences, and relationships are assigned an even bigger value than our physical surroundings. And for many people—from the United States to Venezuela and the Philippines—this transition may have just begun.
Some 2021 Most Popular Play-to-Earn Games
- Axie Infinity
Axie Infinity is undoubtedly the most popular play-to-earn game in the crypto world. It’s inspired by some popular games such as Pokémon and Tamagotchi. Players can collect, breed, raise, battle, and even trade token-based creatures, which are, of course, called Axis. These creatures can all take various forms, and there are currently over 500 different available body parts – these include reptile and plant parts, bugs, birds, beasts, aquatics, and so forth. The parts classify in four different rarity scales: common, rare, ultra-rare, and legendary.
Every single Axie is a non-fungible token (NFT), and it has different attributes and strengths. Users can spend time and effort on upgrading their Axis, and they can trade them for cryptocurrencies on a dedicated marketplace. The native cryptocurrency of the protocol is Axie Infinity Shards (AXS), and it’s used to participate in the governance of the game. AXS can also be staked. We have a detailed guide on how to stake AXS that can be found here. there’s also the Small Love Potion (SLP) cryptocurrency, which is earned by playing the game. It’s an ERC-20 token, and it can be used to breed new Axis. The cost of breeding starts at 100 SLP but increases with every breed – the second costs 200 SLP, the third 300 SLP, the fourth 500 SLP, and so forth, where the sixth one costs 1,300 SLP. You can’t breed more than 7 Axis. Players can accrue SLP throughout the game, and this is how they can essentially earn. At press time, both AXS and SLP are traded on the Binance exchange. The earnings of a player will vary based on the price of SLP at the time they’re selling. However, this can also be a good
Decentraland is another very popular game that was created by Ariel Meilich and Esteban Ordino. It’s worth noting that both of them have since stepped down from occupying major positions in the project but are still working on it as advisors. The project is somewhat of a veteran in the space – it was launched back in 2017 through an ICO, which managed to raise $24 million. It’s essentially a virtual world – a parallel universe that’s running on Ethereum, and players can create, experience, and monetize different content and applications. Users can purchase plots of land. They can, after that, moderate it in a way that makes it more attractive, they can build on it and potentially monetize it. Users have created plenty of different exciting things in Decentraland. Many people see a lot of potential in this virtual reality, and back in June, Reuters reported that someone had bought a patch of virtual land for more than $900,000.The native cryptocurrency of Decentraland is MANA, but there’s also LAND. MANA is a basic ERC-20 token, and it can be burned to acquire non-fungible ERC-721 LAND tokens. The MANA token can also be used to pay for different names, wearables, avatars, and other things available on the Decentraland marketplace.
- The Sandbox
Sandbox is another blockchain-based virtual world that allows players to earn as they enjoy the game. The main mission, according to the public whitepaper, is to introduce blockchain tech into the gaming world in a successful way. It combines the capabilities of decentralized autonomous organizations (DAOs) and NFTs to create a digital world that harbors a considerable gaming community. Its blockchain-based virtual world allows players to build, create, buy, and sell various digital assets in the game. Like Decentraland – there are two different tokens, one of which (SAND) is based on the ERC-20 protocol and is a utility token with a finite supply of three billion. The other one is a non-fungible token (LAND), and there are only 166,464 of it available. LAND can be used to host games, create housing, build multiplayer experiences, and so forth.