Video gaming has traditionally been conceptualized as a fairly passive habit that doesn’t have a lot of earning potential. It tends to be thought of as a hobby for the vast majority of participants in the industry – essentially, everyone other than top-tier professionals who earn money through winning competitions or streaming revenue.
However, with the global gaming business now valued at $300 billion (more than the music and film industries combined), gaming enthusiasts are exploring new ways to turn their interests into income. And with the rise of “play-to-earn” gaming, this dream is already becoming a reality.
Play-to-earn is a new concept that’s enabling players to make real-world money simply by playing their favorite games – no need to be a popular streamer or participate in competitions. But what exactly is play-to-earn? How does it relate to the crypto industry, the gaming industry, and beyond? Read on for our perspective.
What is play-to-earn gaming?
Play-to-earn gaming (often referred to as P2E) is a fairly broad term for a genre of games that are empowering players to earn real-world money off of playing. In many cases, the games utilize cryptocurrencies and blockchain tech to enable these types of income streams. Thanks to P2E, players across the world are currently generating an income from cryptocurrencies or NFTs just by playing games on their computers and/or smartphones.
Using blockchain tech, game designers are creating in-game items that are unique and transferable. These might take the form of an NFT, a cryptocurrency that’s native to that game, or even a popular cryptocurrency.
After earning these rewards, the gamer can export the coins they got to a crypto wallet and convert it to a fiat currency, like U.S. dollars; in games where NFTs are earned, they can be sold to other players, collectors, or speculators at various marketplaces (both in-game and secondary market).
What are the most popular play-to-earn games right now, and which ones are coming next?
As P2E gaming grows in popularity, hundreds of developers have released their contributions to the genre. However, there are a few games that lead the pack in terms of popularity and earning potential.
With 2.8 million daily users and a total trading volume of $3.8 billion, Axie Infinity is one of the top play-to-earn games. As of July 2021, the average Axie Infinity player could earn around 1,125 tokens per week in the game’s native cryptocurrency. At that time, that meant gamers could earn an estimated $389.48 per week just by playing the game. Notably, the price of the tokens has dropped quite a bit since then, with revised earnings potential estimated at around $100 per week (research drawn from Cryptoday newsletter).
Some of the other top games in P2E have roots in DeFi space. Aave’s Aavegotchi lets players stake aTokens while playing with cartoon creatures represented by NFTs. Just by playing the game, you earn yield on Aave.
While many indie studios are making P2E games, some of the largest names in the industry are also beginning to do so – such as Assassin’s Creed and Far Cry developer Ubisoft. The French developer recently announced plans to launch NFTs into the next Ghost Recon game.
NFT leader Bored Ape Yacht Club have also announced that they’re looking into the space, with a P2E game expected to come sometime in 2022.
How is play-to-earn being received by the gaming community?
Though crypto enthusiasts have been thrilled to see the video gaming community explore blockchain technology, some gamers have expressed reluctance around the entry of crypto into their world.
With the arrival of the Ubisoft NFT news, gamers on Twitter and other platforms voiced their dissatisfaction, hypothesizing that this could result in lower quality games. One gaming media outlet, Cultured Vultures, put it this way: “Letting this slide is just the tacit endorsement the rest of the industry needs to nosedive into full-time crypto nonsense.”
Overall, gamers may feel P2E is a continuation of microtransaction-style game development, or have too many roadblocks to entry. Although many play-to-earn games are built on popular blockchains (like Ethereum and Polygon), converting them to a more liquid asset isn’t always the easiest process. NFTs can take time to sell, while in-game coin values can fluctuate quickly.
On the other hand, announcements like the Ubisoft one are like a holy grail for crypto-minded gamers. Some gamers who are more in support of P2E have expressed similarities in the system to already existing game concepts; for example, the popular Diablo III offered a player-only auction house that gamers made real world money off of, while many other games have had unofficial or illegal ways to sell loot with real-world money.
Fans of P2E have expressed that the technology can legitimize gaming as a form of income in a variety of capacities, such as selling loot that they’ve worked hard in-game to receive. It’s certainly among the simplest ways to earn money from gaming, especially when compared to the difficult process of becoming a professional competitive gamer or streamer.
No matter how you feel about P2E, it’s definitely set to have a huge impact on gaming and crypto at large. The next generation of gaming will likely involve NFTs and crypto on some level – the question is when and how, not if.
