We live in an age where almost anything is possible. Free crypto seems too good to be worth it, but it is possible. How? Thanks to the latest developments in blockchain technology, you can play games and earn free crypto.
Instead of playing traditional games, you can just make money doing what you love most: gaming!
Are you curious about what GameFi is and how you can earn money with gaming thanks to blockchain? Find out in this article!
What is GameFi?
Blockchain technology has many more applications than many people know. Where we often think of Bitcoin (BTC) and Ethereum (ETH) when we talk about cryptocurrency, developments follow at lightning speed. The gaming industry is one of the largest industries worldwide, with millions of people playing their favorite games on a daily basis.
For example, gaming is becoming increasingly popular on the blockchain and we also see explosive growth when we talk about GameFi.
GameFi is a combination of the words ‘game’ and ‘finance’. This refers to the countless options where you as a gamer can earn crypto and other assets on the blockchain.
One of the characteristics of the blockchain is its decentralized character. This means that there is no central party that has the power to exert influence.
In traditional games, you have a certain number of levels that you can complete and to complete them you have to do a series of actions, and you’re done.
Thanks to this decentralized nature of blockchain technology, every player has an influence on the game, and everyone has the freedom to design the game themselves, albeit in consensus with the other players in the network.
A good example of this is Decentraland (MANA), the virtual world where you as a player can invest in a virtual piece of land. Then you decide for yourself what you want to do with it. For example, you can decide to build a holiday home on this plot, but you can also place a casino here so that players can try their luck in your casino.
You can also choose to organize your own virtual event and charge an entrance fee. These proceeds go entirely to you as a player, without having to pay a certain cost. Decentraland (MANA) is one of the first blockchain games and was created in 2017, but it is a good example to show how simple a play-to-earn model can be.
In this virtual economy, you can monetize everything yourself. There are no restrictions from a central party that hinder you in making your own choices.
Chances are that you have played Crash Bandicoot or the then-popular Grand Theft Auto (GTA) in the past. With a bit of luck, you had the codes to have more tools at your disposal, such as unlimited money or access to more weapons. But we often don’t think about the fact that the options are limited.
The creators of a traditional game designed this in the source code with the accompanying scenarios that can occur. In addition, the developers of the game still have the influence to completely change this game.
For example, with a new update of the game, they can remove your favorite car or remove your favorite weapon from the game. But what if these assets are now NFTs?
This means that no one but you own this in-game asset. Your weapon in the game is yours and no one else has the ability to take it from you. Due to the further development of GameFi, you can also be sure that you can use this unique NFT in various games, which of course gives you a powerful position as a player.
With traditional games, you know in advance how many levels there are, what status you can achieve and what the options are here. And no matter how long this takes, the time you spend on this is pure entertainment. The only people who really benefit financially from this are the creators of the game.
Thanks to blockchain technology, we have become acquainted with NFTs and their possibilities. And indispensable at GameFi is the use and trading of these unique tokens. These are in-game assets that are actively used to play a game, whereby users can also earn money with these NFTs.
Many game platforms have their own NFT trading platform where you can buy new unique tokens, but also sell yours. And the rarer this is, the more lucrative it is of course!
To achieve this decentralized free economy where players can generate income through games, it is important that there is a DAO structure. This is a Decentralized Autonomous Organization which means that every participant in the network is a co-owner.
Players are given a governance function thanks to the native tokens that allow them to vote on the future of the protocol.
As a result, democracy reigns, and each player is given the freedom to manage their own virtual economy and also trade in their own NFTs. Let’s not forget that these are crucial to GameFi’s play-to-earn success.
For example, via a DAO, players can vote on the number of rewards that will be made available and when and the like.
Due to this consensus, the game remains in the hands of the users in a democratic way and also has a future.
How did GameFi come about?
In essence, blockchain technology is so revolutionary that it can be applied to virtually all aspects of life. Besides the financial aspect where crypto will provide a whole new dimension, video games will never be the same again. We no longer want to be dependent on third and/or central parties.
This also became apparent in the gaming industry where players did not agree with the limitations of the game or the fact that you could finish a game at all.
And even better is of course that as a player we can now also earn crypto, not to mention the tradeability and applications of these NFTs. The possibilities are truly endless!
The first application of GameFi we may know from the hype of CryptoKitties in 2017. Although the current GameFi environment looks completely different, CryptoKitties was the first project where users could invest in these kittens with which they could then breed and keep them alive in a virtual world.
These kittens were an unprecedented success due to, among other things, the scarcity of these NFTs, but also because of their unique character.
Due to this success, we immediately saw that the current technology still had limitations, namely the overloaded Ethereum network. This led to extremely high transaction costs and slower transactions.
To this day, this is still an issue that is central to the further development of Ethereum.
In anticipation of this, new blockchains have emerged that offer greater scalability and also promise cheaper transaction costs. Think for example of Cardano (ADA). This includes the use and trading of NFTs. These ERC721 tokens are tradable on the Ethereum network and often come with astronomical amounts.
Suppose you want to invest in a certain excavator to build your virtual estate or hotel faster, only in this way can you earn money faster. But the purchase of this NFT excavator comes with a transaction cost of several hundred dollars. Because of this, several people are inclined not to make the investment.
For now, many play-to-earn games are found on Ethereum’s network, but that doesn’t stop players from participating. In addition, new GameFi projects are also trying to lower the threshold so that everyone can access their blockchain game.
We saw earlier that players at Axie Infinity (AXS) first had to make an investment of $1,000 worth of in-game assets before they could actually play the game. As a result, a large part of the market was denied access, such as low-wage countries where this amount is a monthly salary. Of course, crypto is for everyone and that is why there are new games that have developed new protocols for this, where, for example, a minimum part of the profits are transferred.
Popular GameFi games
Several GameFi games have been launched in 2021 and it seems like we are still only at the beginning. Many of these protocols have already proven their popularity, but several games are also in the works. Here are three examples that are currently central to the GameFi world.
Create and manage your own virtual monster called Axie. These NFTs are extremely popular and are therefore traded for record amounts on various trading platforms. The whole game revolves around the Axie NFT monsters that you can collect. You can also play with this or cross the Axies to create new monsters. Some even say that Axie Infinity is the ultimate play-to-earn game of 2021!
Do you like Fantasy and have you played Zelda before? Then it’s worth taking a look at the DeFi Kingdom. In addition to the game itself, DeFi Kingdom also has a decentralized exchange where you can swap your favorite tokens. JEWEL, the native currency has already experienced a very nice price development shortly after the launch of the game!
Have you ever played FarmVille on Facebook? Then you know better than anyone how addictive a fairly simple game can be. Can you imagine that you could make money with FarmVille? It almost seems too good to be true, but it is possible via FarmersWorld. In this virtual world, you are the boss of your own farm. To harvest and grow you need tools, this comes in the form of NFTs that you can buy and trade. Please note: the developments of FarmersWorld are in full swing and the IDO will take place in November 2021.
The future of GameFi
In itself, blockchain games, in the simplest sense of the word, are not new. But due to the further development of NFTs and their in-game applications, we see that 2021 has been a special year for GameFi. The popular Axie Infinity is a good example of this. Just launched in August of 2021, and now, less than 3 months later, it already has over a million daily active players.
This is due to several factors. On the one hand, the further development of these games is essential. When we look at CryptoKitties, we can hardly compare this with the gaming experience that players get at, for example, DeFi Kingdoms.
Blockchain Game Alliance
The Blockchain Game Alliance (BGA) is an organization that aims to promote and implement blockchain in the game industry. With this, they want to attract a large new audience. This Alliance is already very positive about the future of GameFi and already has impressive members in its network, including game developer giant Ubisoft. They said earlier in 2021 that the focus of their further development would be GameFi.
GameFi has exploded in 2021 and more and more projects are focusing on play-to-earn applications. It is also the combination of DeFi and NFTs that makes GameFi a unique blockchain application that will continue to evolve in the near future.
How this process will unfold will strongly depend on the developments of DeFi and especially the Ethereum network and possible alternatives. We are currently seeing those main players of traditional games find their way to these blockchain games and the threshold is still unnecessarily high for new players, partly due to the high transaction costs of the Ethereum network.
Nevertheless, there are plenty of alternatives to reduce these costs. As a result, trading in NFTs and digital assets will continue to grow and will also be directly linked to GameFi development and play-to-earn. According to some, the development of GameFi is therefore the gateway to the global adoption of blockchain.