Play-to-earn (P2E) games are a recent and rapidly expanding phenomena in the gaming industry because they combine the two things that everyone wants in life: entertainment and money.
At the intersection of Blockchain Technology and Gaming, something rather unique is taking place. Nowadays, users can make money by playing the games they enjoy because of the quick development of NFTs in the blockchain gaming sector.
The daring application of NFTs in gaming is giving players a wholly new gaming experience and uncovering a wealth of benefits. The player is usually rewarded in today’s play-to-earn games with an in-game token, the value of which is determined by how much liquidity, or money, is present in the token.
Because of this, many utilize non-fungible tokens (NFT) to support their token at first, allocating a portion of their earnings to support it until users start investing their money in it.
Why are NFTs Essential?
The ownership and transaction history related to an NFT are recorded on a Blockchain Network, which is where an NFT lives and dies. It is created in accordance with standards, or groups of detailed guidelines that tokens must follow.
The ERC721 and ERC1155 token standards for Ethereum, which are widely utilized on Ethereum NFT platforms like Rarible and OpenSea, are without a doubt the most well-known standards in use today.
NFTs are non-fungible, which means that they cannot be duplicated thanks to metadata that contains essential descriptive information.
Non-Fungible Tokens (NFTs) are being incorporated by game creators more frequently, and far from being a gimmick to extract more money from players, NFTs applied in the context of games actually offer users a lot of value.
Gaming and NFT’s
Given the information on NFTs provided above, it is reasonable to conclude that gaming and NFTs make a great pairing. Consider tokenizing and converting all in-game objects, such as swords, shields, and potions, into NFTs.
These NFTs, which are maintained in a wallet and connected to a specific gaming account, can subsequently be sold and moved to outside programs. The opportunities are tantalizing.
The ability to tokenize and transfer in-game items means that they are not restricted to a single game or world but may be moved between other games and settings. This, in our opinion, is the most significant result of the use of NFTs in the gaming industry.
The concept of using in-game items as NFTs is great and will appeal to anyone who has invested a lot of time and money in a game only to see their efforts and assets disappear as a result of, say, technical difficulties.
Users who have spent tens, sometimes hundreds of hours playing a game, platform, or account are left with nothing when it disappears, for whatever reason. Not to mention the money invested on the purchases, all of that effort is gone.
All game items can now be instantly moved to an external wallet for storage thanks to NFTs. Even character transfers are possible for usage in different games.
The Play-2-Earn Phenomenon
Play-to-earn gaming simply gives players and game fans ownership and control over in-game resources, allowing them to further improve the value of these resources by actively playing the game.
By taking part in the in-game economy, participants in this business model provide value for the game developers and other players. They receive in-game resources as payment for their participation.
These resources include things like gaming equipment, weaponry, or virtual currency, as well as other in-game items that can be tokenized on the blockchain and even bought and sold as NFTs. This is why using the play-to-earn business model with blockchain games has been successful.
In July, the play-to-earn game Axie Infinity brought in close to $120 million in total revenue. The combined revenue of the remaining top 10 Token Terminal apps at the time of writing was roughly $41 million, compared to Axie Infinity’s hits of over $215 million.
Small Love Potions (SLP), which are required by players to breed more Axies and are paid for by Axie, are earned by players while they play the Axie Infinity game.
For purchasing and selling Axies on the site, Axie levies a 4.25% fee. If a person chooses to cash out his SLP tokens, they may also choose to sell them to other players on a public market.
Play-2-Earn; The Future of Blockchain Gaming
The most important aspect of gameplay is still entertainment. A poor or uninteresting game remains unacceptable, even when receiving rewards in cryptocurrencies and NFTs is a fantastic additional motivation to play.
Even if a small percentage of people were persuaded to play because of the promise of “free money,” they wouldn’t stick around for very long because word of mouth is a potent marketing tool.
How to do that? By providing enjoyable and just rewards. Assuming a game is as entertaining as its non-blockchain competitors, it will likely continue to be viewed as superior by most players.
Within the next five years, according to Reddit’s creator Alexis Ohanian, Play-to-Earn games will account for 90% of the gaming business.
“90% of people will not play a video game unless they are being adequately valued for that time.”
“In five years you will actually value your time properly, and instead of being harvested for advertisements or being fleeced for money to buy stupid hammers you actually don’t own, you will be playing some on-chain equivalent game that will be just as fun, but you’ll actually earn value, and you will be the harvester.”
Undoubtedly, new ways of making money will emerge as time goes on. With the introduction of the Metaverse, in whatever form, everything from adopting a large corporation’s name to leasing property, selling digital goods, or providing digital services will be possible.
It is still a fairly new idea, but it is organically growing in popularity with a market that used to spend their money on gaming but is now able to invest it and their time.
For a very long time, people have viewed video games as nothing more than pure time wasters. Through the bold application of blockchain technology, but particularly of NFTs, it will be possible to enable gamers to make money while enjoying their favorite games in 2021. This is a completely new era in gaming.
The most recent development in the blockchain gaming sector is play-to-earn games. How consumers interact with the economies of their favorite games will change as a result.
In order to ensure that gamers who contribute to the gaming industry are rewarded monetarily, it has ensured and embraced the idea of an open economy.
Due to the large number of players flocking to these games (regardless of how gaming-oriented they may be) to play and gain money for themselves, this has in turn had a domino effect on the cryptocurrency markets.