Can P2E Games be Fun If They’re Equitable?

GameFi has the potential to change the world in ways that are hard to imagine. But not all GameFi is created equal. In fact, some games come with built-in problems that make them less fun and even exploitative instead of profitable for everyone involved—especially gamers who want to get paid and enjoy playing their favorite games.

Play-to-Earn (P2E) games employ a business model that incentivizes gamers to play games with cryptocurrency rewards. This can be enormously beneficial for gamers and crypto alike, but the P2E model needs to evolve if it wants to become sustainable and avoid being exploitative.

Why Current P2E NFT Games are Flawed

P2E games are expensive, meaning there’s a high barrier to entry for new prospective gamers. To play, gamers have to invest something—usually NFTs of some sort—which can amount to upwards of $100 on a game like Axie Infinity. Now imagine the implications of that, considering the majority of Axie gamers are low-wage earners in the Philippines.

Axie Infinity tried to solve the barrier to entry with the scholarship model, which lets players, or scholars, who wish to play the game but do not possess adequate financial resources. Initially, the Axie scholarship system worked in bringing down the barrier to entry and allowed early investors to lend out their NFTs to players unable to afford the cost. In return, investors (now dubbed as “guild”), share in the profits of people playing the game for them.

But the Axie scholarship system made it extremely profitable for investors who initially could afford the high costs to take advantage of those less fortunate. This system also came with some undesirable terms and conditions, which would take cuts of the player’s profits, sometimes up to two-thirds of their total earnings. It’s obvious that the current model feels very much like a pyramid scheme, and if you look closely, the model fails to be sustainable in the long run. You’ll need a constant influx of new players - scholars to keep the top earners happy.

How P2E games can change

P2E can be enormously beneficial for gamers and crypto alike, but it needs to be open to evolving, mainly by making a switch from a play-to-earn model to a play-and-earn model (P&E). The focus should be on creating a game not for the sole purpose of earning, but for enjoying the game itself that truly stands by itself without any earn mechanics. We play games because they’re fun, challenging, and rewarding. In a P&E model, instead of playing a game solely for the purpose of earning rewards, it’s a secondary effect after having fun by yourself or with friends, family, or teammates through online multiplayer experiences, and innovative game mechanics.

Earning mechanics are a given in web3. As soon as tokens were added to a game, the idea took off, and P2E games were immediately successful. However, there are so many other avenues in blockchain yet to be explored and created. Blockchain does not always need to equate to just earning.

To change the current state of GameFi, Web3 games can explore different blockchain mechanics to improve the player experience. Ethereum founder Vitalik Buterin proposed the idea of  "Soulbound" NFTs that can record details of your social identity, or NFTs that offer interoperability. It’s developments like these that have the potential for real change. While none of these include earning mechanics, they do push the true innovations of decentralization from creating a game player’s identity to creating value in different ways for the player.

The rise of Esports in the last decade has created a cultural phenomenon with the rise of monetization with top titles like League of Legends, HearthStone, and CounterStrike: Go. However, Esports within the blockchain gaming space has largely been unexplored. Another way to create equity is to run in-game tournaments with paid participation. The entry fees would make up the prize pool, and be redistributed to the winners, with developers taking an administrative cut. On top of that, every participant could get guaranteed rewards, such as unique in-game cosmetics. This monetization model rewards players for skill and does not need any upfront investments encouraging everyone to participate thanks to the guaranteed prizes.

The GameFi industry needs to make sure that the future of blockchain games is inclusive, fun, and profitable for all involved. P&E games have a lot to offer in terms of creating new kinds of gaming experiences if they are more equitable, easily accessible, and actually fun.

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