Is the future of gaming Play to Earn?
Society’s perception of gaming has evolved from a mindless pastime, to potentially the largest global sport in recent history. The world of competitive gaming and eSports has seen incredible success over the past decade, growing to 465.1 million eSports enthusiasts/viewers at the end of 2021. The eSports market was valued at $1.08 billion last year and is forecasted to grow to $1.62 billion by 2024 (Statista). The enormous growth in the eSports market has caught the attention of major global corporations and brands, who invested over $640 million in sponsorships with gaming organizations last year, and now these brands have shifted their attention to the new kid on the block, Web3 gaming.
Web3 gaming integrates blockchain technology to establish a digital economy, powered by digital currencies that can be exchanged for fiat currency (USD, Euro, RMB, etc.) called cryptocurrencies. Using blockchain technology, gaming companies can also create non-fungible tokens (NFTs) that serve as representations of ownership over a specific digital asset that can be attained in-game. Ownership over these digital assets can then be traded, sold, or purchased on secondary markets where cryptocurrencies are accepted as forms of payment.
With the establishment of these virtual economies, digital assets, and the creation of secondary markets that allow for global 24/7 trading that is not limited to a single game or platform, a new method of incentivizing players to play these games arose. This method is known as a “Play to Earn” model and is sometimes referred to as “Play and Earn”. Nevertheless, the purpose of a Play to Earn game is to allow players to earn cryptocurrencies while playing the game, which in turn can be exchanged for fiat currencies like USD.
This model, in conjunction with the establishment of community-driven virtual economies and secondary markets, allows players to experience gaming with more freedom, ownership, and authority than ever before. In addition to the ability to earn real money from playing a Web3 game, there are some games like Duskbreakers which allow community members who are holding NFTs to actively take part in decision making processes, establishing a community led governance model that is rarely seen outside of small indie projects in today’s gaming space.
Play to Earn gaming took a giant popularity leap in the second half of 2021 with the rise of Axie Infinity, a Web3 game similar to Pokémon where players can breed Axies with unique traits that can be traded on secondary markets. Axie Infinity has reported 2,225,346 active players DAILY, just in the last 30 days. It is reported that there are people in the Philippines and other low-income communities that are making more money playing Axie Infinity than working an office job in their area.
Play to Earn gaming has also been a topic of much pushback from traditional gamers who believe that this model influences players to focus more on monetary gain rather than enjoying the game. Although the future of Play to Earn gaming is uncertain, there is now a new model of Play and Earn gaming which places more emphasis on the quality of gameplay and in-game experiences rather than methods for earning revenue from playing the game. This Play and Earn model serve the purpose of repositioning Web3 gaming brands as more gameplay-focused in the hopes of attracting more traditional gamers, bridging the gap between traditional gaming and Web3 gaming.
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Check out this video explaining blockchain gaming!