The Future of GameFi: Can Play-and-Earn solve the Play-to-Earn Problem?

Published on Mar 21, 2022 11:25 AM IST

One of the new sectors arising out of this natural evolution is Play-and-Earn (P&E). While P2E focuses on earning, P&E emphasizes ownership and quality gameplay, which are better suited to promote longevity.

KittyKart
KittyKart
ByHT Brand Studio

As part of the DeFi boom and metaverse craze taking the world by storm, Play-to-Earn (P2E) gaming has solidified itself as a burgeoning new division of GameFi technology.

Play-to-earn games are exactly what they sound like, games that are designed to deliver both earning potential and entertainment. Most P2E games have native tokens for in-game purchases and trading between players.

One of the players leading the way in the P2E space is Axie Infinity. The platform banks on players making (often hefty) upfront investments in game-specific NFTs or “Axies”. Through gameplay, players battle, breed, and trade their Axies, hoping to turn a profit.

Although Axie has brought in over $3 billion in trading volume since its launch in March 2018, it has come under fire recently for its unsustainable foundation. The drastic plunge in the value of Axie’s token, Smooth Love Potion (SLP), forced the company to scramble to adjust its business structure.

SLP’s uncapped supply created an unsustainable environment destined for inflation, and as the value of the tokens inevitably declined, so did the number of users. As of January 31st, the game had only 2.2 million daily active users, per Sky Mavis, compared to a peak above 2.7 million in November. "The Axie economy requires drastic and decisive action now or we risk total and permanent economic collapse," acknowledged Axie developers in a post.

Examples like this expose how difficult the P2E model is to sustain, often falling short of the promise to provide users with the opportunity to earn money. Further, because the focus of game development hinges on optimizing profit, not fun, players can become stuck in a sub-par gaming experience, working long hours in an effort to recoup their initial investment.

It’s not just Axie Infinity, though. Many other P2E projects have proliferated without addressing the inherent challenges of this model. As with any new technology sector, P2E must learn from its shortcomings and adapt. Other P2E projects would be wise to learn from Axie’s missteps and adapt to better meet the needs of their communities.

One of the new sectors arising out of this natural evolution is Play-and-Earn (P&E). While P2E focuses on earning, P&E emphasizes ownership and quality gameplay, which are better suited to promote longevity.

One such company pioneering the P&E movement is Kitty Inu, a project building a new kart-style racing battle royale game, KittyKart, on the Ethereum blockchain. By combining Free-to-Play (F2P), Play-and-Earn (P&E), and an emphasis on the quality of the gaming experience, their aim is to redirect the crypto gaming space into a more positive and sustainable direction.

Unlike many blockchain games, KittyKart doesn’t charge users an access fee, and unlike traditional gaming, players retain full ownership of all earned and purchased assets, which can be traded or sold for $kitty tokens via the in-game marketplace. The supply of $kitty tokens is capped, and best-in-class game developers have been retained to build a fun, eye-catching, AAA-quality game. The project is creating a platform that will help position P&E as a more stable and enjoyable alternative to P2E.

To ensure the economy of their game is “sustainable for decades to come,” Kitty Inu has retained an in-house economist, financial strategic analyst, and talent acquisition specialist. They have also hired several engineers to build KittyKart’s in-game marketplace. “We are crossing all of our T’s and dotting all of our I’s to make sure we build one of the best games out there,” one of the co-founders stated on the project’s Telegram page.

 

Disclaimer: Online gaming may be addictive. NFTs are digital assets and subject to risks. Opinions expressed are of the author and does not reflect the opinion of Hindustan Times.

 

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