Axie Infinity turned its game into a billion dollar economy that helped thousands of gamers in the Philippines and other low-income countries weather the fallout from pandemic mitigation measures. The main ingredient for success: strong property rights.
Players can mine in-game material and trade on third-party marketplaces like OpenSea. The freedom to set prices and trade with ease unleashed a veritable tsunami of economic activity in and out of the game.
Cointelegraph Research’s 30-page report looks at the top five titles and what’s changed since the days of Second Life and is produced in collaboration with Galaxy Fight Club, The Sandbox, Planetarium, Immutable x, SolaDefy, Decentral Games, X World Games and Animoca. brands
Building a new economy
The report delves into the differences between the virtual economies of the past, such as Second Life or World of Warcraft, and modern blockchain-based games, such as Axie Infinity or DeFi Kingdom.
Developing a well-functioning marketplace complete with an in-game currency and open standards for game material was simply beyond the scope of any development studio in the past. But blockchains offer cheap building blocks to game developers. The technology allows developers to release a token within an hour or define in-game materials as non-fungible tokens (NFTs). This gives users strong ownership rights and the ability to bring their characters and items out of games to third-party marketplaces or even other games with little additional development cost.
Download the full report here – free.
With the addition of decentralized finance (DeFi) technology, players have financial opportunities that they have never had before, leading to rapid adoption of these games.
The report then compares the top five blockchain game titles Alien Worlds, Axie Infinity, Bomb Crypto, DeFi Kingdom, and Splinterlands. Each of these games has different gameplay and offers different incentives to players. Daily active users, transaction volume, deposited balances and gameplay, as well as tokenomics which are the economic incentives for in-game currency, are compared.
But no report would be complete without covering the dark side of blockchain gaming. Environmental concerns, a sharp divide between haves and have-nots, legality and tax implications are all valid concerns surrounding these new economies. This is especially important as the huge success makes these games more and more attractive to gamers and game developers.
GameFi titles were responsible for more than 35% of all Polygon transactions during the peaks of 2021 and early 2022. But without addressing the potential issues, the long-term viability of the entire blockchain gaming space is in doubt. compromised, as critics and regulators will use these arguments to hamper development or make it difficult for players to participate.
Get ready, fight!
The report has an optimistic conclusion about the future of blockchain gaming and the potential unlocked by economic freedom. Lower transaction costs, stronger property rights, and open standards work together to open up the planned economies of earlier gaming markets.
Blockchain technology opens up a world of new opportunities for developers and gamers. If environmental and regulatory concerns can be addressed, 2022 will be GameFi’s best year yet.
This article is for informational purposes only and does not represent investment advice or investment analysis or an invitation to buy or sell financial instruments. Specifically, the document is not a substitute for individual investment or other advice.