Blockchain and crypto games are taking the gaming industry by storm lately bringing new features and ideas into the sphere. While some consider them just another short-lived trend there is a justifiable desire to try them out. Besides the novelty factor, most crypto games are play-to-earn they can become a source of additional income. Without a doubt, that is appealing to many yet there are various facets to understand before entering GameFi.
What is GameFi?
GameFi is a fusion of the words “Game” and “Finance”, used to describe play-to-earn crypto games creating profit. This may sound like fiction but it is created on grounded concepts. It combines DeFi (this includes on-chain items, yield farming, and others), gaming and blockchain technologies. The actual term of GameFi was used for the first time on September 2020 by Andre Cronje, CEO of Yearn Finance. Since then, the term has become widely accepted and used when referring to video games using blockchain and DeFi elements.
It is important to acknowledge that in conventional games in-game items do not have any value outside of the game’s universe. Besides that, owning such items does not mean having actual control over them as the game studio just rents them out to the player for an indefinite time. In comparison, crypto games offer full control of digital items as they are transferred to the player’s wallet. Yes, it should be known that playing crypto games requires having a crypto wallet yet it is simple and easy to process to create one – thus no need to worry about it.
Play-to-earn (known as P2E for short) is the main point of crypto games and is one of the main reasons for their popularity. It is a business model where players can potentially earn cryptocurrency when playing. In other words, games let players earn rewards that have real-world value outside of the game.
Rewards come in various forms of in-game items, such as virtual land, crypto tokens, weapons, skins, and other on-chain items. The longer the player keeps playing, the more items they can collect. In addition, certain items might be in limited quantity or distributed only for a limited period of time, making them grow in value over time. Contrary to conventional games, players can transfer and trade their in-game items with others for cryptocurrency or other items.
image from blogs.godsunchained.com
P2E ways of earning
Earning through gameplay. In this way, players can earn while collecting in-game items, playing matches, completing objectives, and others. This way is the simplest, providing rewards for just playing the game.
Receiving or selling in-game items. Players can own items such as skins, weapons, virtual land, and others, received as rewards for playing the game. The catch is that the rarer the item is, the more valuable it is if there is demand for it. Thus some can earn a hefty sum selling weapons received months ago if it becomes one of the meta choices.
Earning through investment. Some people who can not find time to play might only get involved in trading on-chain game items. This means buying and selling in-game items in demand, or even lending them to the players. This may sound bothersome for some, but it is one of the things crypto games offer conventional ones do not.
image from axie.substack.com
Use of blockchain
The unique selling point of crypto games is them being based on blockchain and thus provide complete control of items. As more and more developers embrace blockchain gaming and are bringing real money into the sphere. The most known titles in the space include Axie Infinity, Gods Unchained, and Splinterlands.
When it comes to the actual use of blockchain technology, one of the prime example s Axie Infinity. In this game, players earn SLP (smooth love potion tokens) that can be exchanged for fiat and cryptocurrency. Furthermore, players can sell and trade and sell their Axies (fighters that participate in game battles) with the others for cryptocurrency in the game’s blockchain marketplace. Besides that, all the items (in this case – Axies) are kept in the player’s owned crypto wallet, thus game creators no longer have control of them.
The rise of crypto games is nothing to ignore as together with AR, they are bringing new features and technology into gaming never seen before. It is an amazing opportunity to change the industry giving more control to the player. An exciting future lies within the path of crypto games and we highly encourage everyone to try them out!
Stay Tuned to All The Latest News on Gaming
Interested in learning more? Follow Breach for the latest industry news & don’t forget to Sign up! And be one of the first ones to join Breach MVP, which is rolling out soon!