Since electronics have been around, gaming has become very popular, with the advent of the internet it has become even more popular and the same could happen again as blockchain technology gets more and more involved in gaming.
You read that right, according to many, Play-to-Earn is the catalyst that will take gaming to the next level. Play-to-Earn is a fairly young branch of gaming. This makes it possible for gamers to earn money directly from a game, so not through tournaments or creating content, but directly by playing the game.
Many of the Play-to-Earn games use blockchain technology, which allows you to actually own the characters you play with and the items you use within the games, through NFTs.
There are therefore various ways in which you can earn money from these so-called Play-to-Earn games, for example by playing them, but also by investing in them. Would you like to know more about this topic? Then read on quickly!
What is Play-to-Earn?
Play-to-Earn is a relatively new branch of gaming in which you play a game and earn money from it. With the application of blockchain technology, it has become more and more popular and according to many, it is the future of gaming. Blockchain technology would contribute to one of the biggest revolutions to date when it comes to gaming.
When you play a game, like Fortnite or GTA, you’re probably doing it for fun. While it is possible to make money from this, for example by making YouTube videos about it or by participating in esports tournaments, most people don’t make any money from it. In fact, it is also Play-for-Fun.
This is different through Play-to-Earn. Players earn real money from what they do in the game. At least, when blockchain technology is used, they often earn tokens or NFTs, which they can then exchange for real money. But how exactly does this work?
What does Play-to-Earn have to do with blockchain?
You are probably wondering how exactly this ‘cooperation’ between Play-to-Earn and crypto works. Its basics are actually quite simple to explain. The so-called Play-to-Earn games are often linked to a particular blockchain. For example, Axie Infinity on the Ethereum blockchain, and Defi Kingdoms on the Harmonyblockchain.
This basically means that the actions you perform in the game are basically just transactions on the blockchain. Transactions involve tokens and/or NFTs and so you can often save these tokens and/or NFTs by playing the game.
For example, there are Play-to-Earn games where you have to battle against other players. Then, when you win, you get a certain amount of the game’s native token. There are also games where you let your characters go on a quest, in the hope that they will find items. These items are then, for example, books or crystals, in the form of NFTs. Also, the characters, weapons, or other items you use are often NFTs.
When a Play-to-Earn game uses blockchain technology, it is often referred to as a blockchain game, crypto game, or Defi game.
Let’s take a look at some examples of Play-to-Earn games that use blockchain technology, as well as the revenue models behind these games so that you can get a good idea of how it works in practice.
Examples of Play-to-Earn games?
To really understand it, it is useful to look at some practical examples. So that’s what we’re going to do now. These are some of the best-known Play-to-Earn games right now.
First of all, of course, Axie Infinity. Released in 2018, Axie Infinity is the game that really made Play-to-Earn mainstream. Axie Infinity is played by an average of 1.85 million users and especially in Southeast Asia, Axie Infinity is their main source of income for many people.
Axie Infinity is all about the Axies, little monsters who are the main characters in the game. These Axies are NFTs and you must buy them before you start playing. In Axie Infinity you and your monsters are part of the Axie Universe.
Together with your Axies you can enter battles, against both computers and other players, for which you receive rewards, namely in the form of the SLP token (Smooth Love Potion). You can sell this SLP, so you actually earn real dollars playing, but you can also use it to breed more Axies, and possibly sell them. You can also complete daily, weekly and monthly challenges in Axie Infinity, for which you also get SLP in return.
Axie Infinity is currently by far the most popular blockchain game, so we wrote an extensive blog about it. Do you want to get started with Axie Infinity? Then this article here is ideal for you!
Another well-known Play-to-Earn game that uses blockchain technology is Defi Kingdoms. Defi Kingdoms is a game on the Harmony network.
Everything in Defi Kingdoms revolves around your own kingdom. In Defi Kingdoms, you have heroes, in the form of NFTs, that you can use to complete quests. For example, you have the fishing quest. You then send your hero out to go fishing, and this hero will come back with certain items (NFTs). For example, you can sell these, but you can also use them for crafting. When you start crafting, you turn these items into potions, which you can use for your heroes, for example, but also sell them again.
Also in Defi Kingdoms, you can put your ( the game’s native token) JEWEL in the bank, so you can receive returns on top of your tokens, or you can farm in one of the many farms by providing liquidity.
So there are plenty of ways in which you can earn money in Defi Kingdoms, although you can also lose money, for example when the token decreases in value.
Have you become interested in Defi Kingdoms and want to know more about it? Earlier we also wrote an extensive blog about this game. You can find it here!
How do you play a Play-to-Earn game?
Would you like to play a Play-to-Earn game and hopefully earn some money from it? Then the first thing to do is to choose a game. That could be one of the aforementioned games, but you can also look at DappRadar for other options.
When you want to start with your chosen game, you first have to find out what you need to start with that specific game. For example, you need Axie Infinity at least 3 Axies (NFTs) to get started, and at Defi Kingdoms, you must have at least some JEWEL, and it can be smart to also buy a Hero because this gives you more options and so you can do more in the game.
Once you know what you need to get started with your chosen game, the next step is to buy it. Tokens can sometimes be purchased through a central exchange, such as Binance or Kucoin, but with smaller games, you will often have to go to a decentralized exchange, such as PancakeSwap or UniSwap. To find out, you can look up the token on CoinMarketCap or CoinGecko, and then see under ‘Markets’ where this token can be purchased. You can sometimes purchase the NFTs through OpenSea, namely with games built on Ethereum or Polygon, but sometimes also through a marketplace built by the game itself. You will often see this on the game’s website, or in the Telegram group or Discord server.
When you have purchased everything and have it in your wallet, you can get started. When it comes to Play-to-Earn games, this wallet will in most cases be a MetaMaskthe most widely used digital wallet, accepted by almost every game.
It is now important to connect your wallet. You can see your wallet as your account with the game. All player information is actually stored in your wallet, as well as your progression. In some cases, however, you also have to create a separate account, but this differs per game.
Once your wallet is connected, you can start playing. This is of course completely different per game. You will often be offered an introduction, which explains exactly how the game works.
How do you invest in Play-to-Earn?
When a new trend like this shows up in crypto, many people often quickly become interested in possible investment opportunities. Maybe you too! But how do you invest in Play-to-Earn?
This can be done in 2 ways, namely: the tokens and the NFTs. As we explained to you earlier, many of these Play-to-Earn games run on a blockchain. This often means that tokens and/or NFTs come into play, which often have a function within the game. For example, with Axie you need both the Axies and the SLP token, and in Defi Kingdoms, you need at least the JEWEL token, and if you want more you can also get a Hero-NFT.
So when a game is played a lot, there is often a lot of demand for both this token and the NFTs. Assuming one of the basic economic principles: when demand rises, the price will rise, and this will cause these tokens and/or NFTs to rise in price.
So it could be a good idea to keep an eye on which games you like, or in which games you see a future.
You can also invest in other projects that are related to games, but not directly related to one specific game. For example, you have gaming guilds such as Yield Guild Games (YGG) and Merit Circle (MC). These are projects that deal with multiple games, not one specific one. This theoretically reduces your risk.
What is often seen as a good tip, however, is that making money with Play-to-Earn should not dominate. It is of course dangerous that you invest a lot of time and money in a game that you actually don’t like. Although there is a chance that this will turn out well in terms of return, this will probably not make you happy in the long term.
The future of Play-to-Earn?
It all sounds very nice, but does it actually have a future? Is it true that in 5 years we will only be playing Play-to-Earn games, or will it be okay in the end? According to the experts, this is inevitable.
According to these same experts, one of the problems that Play-to-Earn games still have until now is that the games are not yet at the same level as other games that we play, for example via the console. For example, there are no Play-to-Earn games that you can really compare to games like GTA, Fortnite, or FIFA 21.
It is therefore said that it is crucial that major game studios, such as Rockstar Games, Epic Games, and Electronic Arts, will also be involved in blockchain gaming. When that happens, there will no longer be a brake on developments. These companies bring with them enormous expertise and experience.
Of course, you can never be 100% sure what the future will look like, but the chance that blockchain technology will somehow be more connected to the world of gaming seems quite high.
Today we looked at Play-to-Earn, which many believe is the future of gaming. First of all, we discussed what it is exactly, but also what connection it has with the blockchain.
Next, we looked at two real-world examples, namely Axie Infinity and Defi Kingdoms, probably the two biggest Play-to-Earn games right now.
Then we looked at how you can play a Play-to-Earn game, but also how you can invest in it so that you can hopefully start making money from it. We then closed it off by looking at what the future of Play-to-Earn will hold.
Finally, it is important to mention that nothing in this blog should be seen as financial advice and that you should always do your own research! Only invest based on your own findings. We also think it is important to point out that Play-to-Earn is basically about fun, and that earning can be a nice side effect. However, this should never prevail.