As crypto prices have crashed, the longevity and sustainability of the Play to Earn (P2E) model is being called into ever-greater question.
The collapse of Terra/Luna, Three Arrows Capital, Celsius, and other big-name crypto industry players, has sent shockwaves through the ecosystem. All this uncertainty has led to tanking token prices.
As a result, P2E games have struggled to maintain the headline-grabbing player numbers of yesteryear. Now, the Web3 gaming community is looking for an answer to the question, “How do we keep gamers hooked when the financial rewards dry up?”.
The answer is prioritizing fun, entertaining gameplay. It’s that simple, although it’s easier said than done. Landmark games like Axie Infinity have forged ahead as early innovators for the next era of gaming. But now the real work starts on how to build Web3 gaming into an industry with staying power.
P2E vs Play and Own
First, definitions. With both, it’s in the name.
Play to Earn: the primary objective of playing is to earn money.
Axie Infinity will always be the go-to example for P2E and the ascent of Web3 gaming in general. And Web3 gaming will always owe Axie Infinity a debt of gratitude for putting the segment on investors’ and gamers’ radars. Just as Flappy Bird is the go-to example for the dawn of the mobile gaming era, the simple concept and UI/UX of Axie Infinity led to its mass appeal. But this time the innovation was in the addition of quick and easy financial returns; that is when the market is up.
At its peak in January 2022, Axie Infinity had a community of 2.7 million live players. But since summer 2022 that number’s been consistently below 1 million per month. It seems once the financial rewards were removed from the equation, the game lost its allure among players.
From P2E came an X2E surge, with the likes of StepN’s “Move to Earn” model. Such games have all seen similar life cycles: a short burst of interest and activity, but ultimately a lack of longevity, with diminishing returns as the user base thins. Not all is lost, as interest will likely swing back to the upside again with the next bull run. But for Web3 gaming to really come into its own, a more sustainable model and following are required.
Now for Play and Own: the priority is on good, fun, entertaining gameplay that naturally draws in players. Meanwhile, users also have the additional option to retain the financial value of their time and effort through NFT ownership. But fun is always the primary objective. It’s Play AND Own if you’d like to.
The distinction might sound nuanced, but essentially it comes down to intent. With Play and Own, the players are not there to make money; primarily they’re there to enjoy the game. This is already the case with Web2 games, where players usually pay for the privilege of the experience and/or community interaction. With the Play and Own Web3 gaming model, players also have the option to turn their in-game assets – such as leveled-up characters or items, or land – into digital assets in the form of NFTs. That means they can trade the fruit of their labors on the open market if they so desire.
Why the Play and Own model is more sustainable
In short, it comes down to the focus on entertaining gameplay. Anyone who’s worked in the Web2 gaming industry knows that fun is the only surefire way to attract gamers for the long haul. That’s the only proven way to build long-term community and loyalty, and thereby ensure the longevity of a game.
Think of a World of Warcraft where your leveled-up character is worth more than just bragging rights and good memories. Right now, players are more than happy to pour hundreds of hours (cumulatively) into planning WoW raids, with no thought of any financial return. With Play and Own, they’d also get the chance to sell on their hard-earned in-game assets once they’re ready to put down their weapons. It’s an additional incentive, but not the core attraction.
Again, the precedent often referred to for in-game assets is Magic the Gathering. The physical card game already has an active, though unofficial, secondary market. But because the game itself is so addictively fun to play, that secondary market will always remain just that – secondary, and not the primary objective of buying the cards in the first place.
In 2023, look for the rise of Play and Own
To all you Web3 enthusiasts, don’t lose heart because P2E is having a tough time right now. Consider this latest bear market a lesson learnt for Web3 gaming. Following on from the pioneering P2E model is coming the more measured rise of Play and Own. Thankfully, we’ll soon be seeing more and more of this sustainable Web3 gaming model, which leverages blockchain technologies to give players additional value without sacrificing fun, entertaining gameplay.
Joseph Derflinger has been in the video game industry for more than 10 years, with senior positions at Perfect World, GREE International, Tencent, and NetEase. With rich experience in developing many well-known AAA games globally, Joseph aims to transform the Web3 gaming industry with state-of-the-art gaming design and technology. He is the CEO and founder of Web3 game studio and publisher Red Door Digital.
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