GameFi and gaming economies: a little less conversation, a little more action

Reading the news, it can feel hard to tell whether Web3 gaming is celebrated, hated, or somewhere in between. Every week there is a new headline about a company doubling down on its investment in in-game NFTs, or backlash from gamers against high entry prices to play-to-earn games. The debate about Web3 gaming might continue to rage, but ultimately, there can only be one clear winner: progress. 

With the majority of Gen Z willing to spend real money on in-metaverse items as they would in real life, it won’t be long until the old guard accept the inevitable - that Web3 and blockchain gaming aren’t a temporary craze, they’re the basis of a new generation of games. What those who oppose Web3 gaming miss is that it isn’t just about an NFT drop, and in-game purchases don’t just have to be limited edition skins that give the player prestige. So, in a divisive field and with new use cases to be discovered, what can studios do with Web3 and blockchain to improve the player experience?

Examining the playing field 

Emerging studios understand the power that Web3 has to improve the player experience with cross-platform collectibles, metaverse activations, and genuine economic value. But for traditional gaming companies, so many of these concepts are getting stuck in the boardroom. To emulate the success of Web3 startups and overcome the struggle incumbent studios face, it is time to examine the playing field, set a strategy, and deliver on these innovative ideas. 

Navigating GameFi can be tricky, as it involves blockchains, protocols, savvy developers and buy-in from users. Perhaps the best known and most widely used implementation so far is the incorporation of NFTs into a game; allowing players to invest in real ownership within the gaming world. One of the top rated blockchain games (per DappRadar) is Alien Worlds, with 225.3k unique active wallets, a near measure to the number of active users. 

Alien Worlds has seen users trade NFTs of in-game playing cards that amount to more than $31million in real-world money since its launch in 2020. But more than simply purchased and used to store monetary value, these NFTs are found and earned in-game and used to connect and play with others. Players can also earn Trilium, an in-game currency that can also be used to participate in ‘Planet DAOs’; or decentralised autonomous organisations. In this way, players can use their Trilium tokens to vote on in-game events, create mini games within Alien Worlds, and elect a planetary custodian, with results recorded on the immutable, transparent blockchain to ensure fairness. 

A well thought-out strategy, incorporating a system by which players can engage in governance, trading, and earning, opens entirely new opportunities to leverage Web3 and show players how rich a blockchain-based game can be. But this also means considering more than in-game purchases, and a new model for in-game economy. 

From ‘play-to-earn’ to in-play economies

Similarly, the ‘Play-to-Earn’ (P2E) structure can be popular with users. Games like Axie Infinity helped make the P2E model popular with its launch in 2018, but without a sustainable, long-term view to how players would earn in-game assets with real-world value, they can only go so far. The price of entry to the most popular games quickly becomes too steep, as players must make an initial investment that supports the in-game economy. However, new models, such as economic structures within games that allow players to assign one another tasks and jobs could open doors to totally new ways of thinking about GameFi.

Effective blockchain games require strategy to successfully launch and operate. As competition in the space heats up, simple in-game assets will no longer impress gamers - they’re looking for more complex, rich worlds where the tokens they earn and NFTs they collect are an integral part of gameplay - they derive their real-world value from their utility, not just from scarcity and prestige. 

The key is to think long term. Create a strategy, plan out how your in-game tokens will inform the player journey, and what value they offer in-game, as this will underlie what value they hold in the real world. How can players use their hard-earned in-game tokens to progress further in the game, reinvesting them in fellow players and an in-game economic system? With a little Web3 and blockchain expertise, you can then build out the system you’ve imagined using smart contracts, DAOs, and cryptocurrencies. 

From starting out to the final level 

Ultimately, the best time to get involved with Web3 is now, as the market is set to boom - to the tune of $65.7billion by 2027 from its current size of nearly $5billion. Embracing the potential of this technology, seeking a strategic Web3 development partner, and planning a meaningful experience are key for games studios to survive and thrive.