Opportunity to bring the next tens of millions of new users into the world of cryptocurrency.
Current Status of the GameFi Track
The overall performance of the GameFi track in 2022 can be summarized as high opening and low walking. Except for outperforming the market in April, the market value of GameFi has basically maintained the same trend as the cryptocurrency market, and the decline is greater, entering a deep bearish state.
The sluggishness of the market is intuitively reflected in the short life cycle of the project and the rapid loss of users. From the “Play to Earn” model laid in 2021 to the “Move to Earn” and “X to Earn” models that broke out in 2022, the “new bottle of old wine” game model still uses a variety of Ponzi models and attractive returns as gimmicks, which have attracted a large number of new users to this track, but the misuse of the Ponzi model gives the project party and players the wrong guidance:
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For the project party, putting DeFi on the outside of Game, coupled with the complex token economics disguised its unsustainable nature. Once players cannot profit and lose, all GameFi will fall into an inescapable death spiral, and few projects can maintain an active state for more than three months.
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For users, actual income has become their most important consideration factor, and both game belief and community culture have been replaced by the payback period. Players compromise on the game experience, resulting in the project party being unable to extricate itself from the revision of the economic model plan.
But behind the cruel reality, there are also opportunities. GameFi is still one of the areas that absorbs the most financing in the cryptocurrency industry in 2022, with financing increasing by nearly double year-on-year. In the development of GameFi, the chain game ecology has played an important role. There are Gala Games, which led the last GameFi bull market and innovated. There is TreasureDAO, which has established brand awareness because of incubating the explosive chain game The Beacon. There is also Block Ape Scissors, backed by Binance, which wants to achieve a “great reshaping” of the BSC chain game circle. In the alternation of old and new, the market may have reached the bottom, and they may become the driving force for the outbreak of the GameFi track in the next round of bull market after experiencing the precipitation of the bear market.
Gala Games: The Leader in GameFi, How Far Has the “Steam of Blockchain Games” Come?
Gala Games: The “Steam of Blockchain Games”
Gala Games is a blockchain game development company founded in 2018 with the aim of building a decentralized game ecosystem and becoming the “Steam” of blockchain games. Unlike the real Steam, Gala Games needs to play two roles: game developer and game aggregation platform. In addition to the games developed by the team itself, other game manufacturers can also launch games on the Gala platform after being approved by the nodes.
Gala Games is developing and operating multiple games of different types, giving players control over the assets they acquire in the game and allowing them to trade items and props on the blockchain. Players can not only experience the fun of the game, but also control their game assets and earn revenue in GameFi with their game skills.
The Gala Games ecosystem consists of five parts: games, game publishing platforms, NFT markets, cloud hosting, and the $GALA token economy. Gala Games runs on a distributed computer network rather than a centralized server controlled by a single entity. These “computers” (called nodes) provide processing power for Gala Games’ decentralized game network in exchange for rewards.
In Gala Games’ decentralized node network, users can use consensus voting to decide which games can be launched on Gala Games’ platform, and can also decide the reward ratio of nodes through voting. For games launched on the Gala Games platform, most of the in-game NFTs will be listed on the Gala NFT store, while a small number of NFTs will be allocated to founder nodes through a random allocation algorithm.
Gala Games has launched 18 games
Currently, Gala Games has launched 18 games. In addition to the popular official self-developed games Town Star, Meow Match, Mirandus, and Last Expedition, there are also games such as GRIT, PokerGo Play, Spider Tanks, Superior, Legends Reborn from other studios. These games cover various types such as role-playing, shooting, simulation management, card strategy, and tower defense, and the platforms on which the games run also cover web, PC, mobile and almost all popular game types and operating platforms.
Moreover, from the perspective of visual effects, the quality of these games has far exceeded that of some other chain games during the same period. However, while ensuring game quality, some problems have also arisen. High-quality games (3A or quasi-3A level) have high investment costs and long development cycles. How to adapt the economic model and development progress in the fast-paced Crypto circle is a huge challenge. In addition, Gala Games’ overall operation is biased towards centralization, with relatively weak community atmosphere and limited node governance scope. For ordinary investors, whether it is to obtain information or participate in investment, the entry barrier is quite high.
TreasureDAO: Awaiting the launch of the “Nintendo” of the crypto world, “small and beautiful” is the top priority
Treasure DAO
Treasure DAO is a game ecosystem built on Arbitrum and connected by the MAGIC token, aiming to establish a “decentralized Nintendo”. Each item in the Treasure ecosystem (Legions NFT, MAGIC token, etc.) is distributed for free, and other collections on the Treasure market are also distributed for free and fairly. Treasure was originally built on the Ethereum mainnet, but later, due to the high Ethereum network gas cost at that time, in order to reduce the user threshold, Treasure migrated to the L2 layer Arbitrum chain for construction.
TreasureDAO Ecosystem Overview (Image source: PKU Blockchain)
TreasureDAO was launched by the community in November 2021, driven by the community and launched fairly, starting from a Loot imitation plate Treasure NFT, and gradually growing into one of the most well-known game ecosystems in the GameFi field through chain games such as Legions, Life NFT, and Magic starting from air coins. Looking back on the development history, TreasureDAO’s growth cannot be separated from the support of the internal supporting infrastructure of its ecosystem: the universal currency Magic and the three-carriage Trove, Bridgeworld, and MagicSwap.
Trove is an NFT marketplace and game launcher on Arbtrium for trading NFTs. Bridgeworld is the core economic hub of Treasure DAO. As a resource coordination game, it integrates many Defi gameplay around mining, farming, summoning, exploration, etc., and promotes the development of Treasure DAO’s economic system. In addition, there is also the AMM protocol MagicSwap, which is committed to becoming the portal for cross-game economy in the TreasureDAO ecosystem. Currently, Magicswap’s swap and pool only have two trading pairs, Magic/Gfly (BattleFly DAO’s governance token) and Magic/ELM (Tales of Elleria’s governance token).
The Beacon, a phenomenon-level product launched by Treasure DAO, has become the detonator that ignites the ecology, with nearly 26,000 players and 65,000 purchases of in-game Genesis character NFTs in just one month since its launch on Arbitrum. The popularity of The Beacon has also driven the increase in Treasure DAO data, directly increasing the weekly active users of Treasure DAO from about 5,000 to 20,000, nearly quadrupling the number.
The Beacon is an RPG game where players can select a basic weapon to explore the dungeon, upgrade weapons during the exploration process, and engage in home mode, single-player PVE mode, and tavern quiz. The home mode is used to edit houses, the single-player PVE mode rewards players for successfully exploring the dungeon within a specified time frame, and the tavern quiz requires players to answer npc questions.
Although The Beacon game itself doesn’t have too many stunning features, it has attracted a lot of attention in the Web3 field. One important reason is that there are very few really fun games in the Web3 game space. The emergence of The Beacon game has brought some surprises to people, and although it may not be considered top-level in the Web2 game space, it is considered a good level in the Web3 game space. This also indicates that Web3 games are still in the early stages and there is more to explore and develop.
TreasureDAO is targeting the long-tail game market. 3A games will only be a standard that a few large game factories can achieve. Web3 players who are gradually growing will have a great demand for such small games and AA games. TreasureDAO is trying to make this “small and beautiful” model work. Starting with popular games, and gradually expanding, TreasureDAO is establishing a set of infrastructure and ecology to meet the needs of independent developers. Each game can benefit from the economic value of MAGIC and shared resources, and the accumulated player activity content can be used to form an economic entity. It will not be affected by the short-cycle impact of a single game, so it has a stronger ecosystem recovery capability.
Block Ape Scissors: Backed by Binance, The “Great Reshaping” of the BSC Game Circle
Previously, the vast majority of GameFi projects had very limited gameplay compared to traditional AAA games. Many rushed projects were launched to catch up with the market, still using the old DeFi mining routine with a game skin to do “mining and selling”. In terms of game experience, there is a huge difference from traditional online games and single-player games. From an economic model perspective, many project parties even treat games as financial disks, which has led to the embarrassment of “death in the light” of chain games. BSC chain is the hardest hit area for this “local chain game”. Looking back at history, some well-known GameFi 1.0 projects, such as Farmer World, Spaceship, THG, Raca, Valkyrio, and BNB Hero, all ended up in a death spiral.
It is not to nail these GameFi 1.0 stage projects to the “shame column”. In fact, these low-quality Play-to-earn chain games also play an important role in the development of GameFi, but essentially they are similar to dog coins and meme coins to some extent, and ultimately they only become short-term speculative tools for a small number of high-risk enthusiasts. At this stage, game players are no longer satisfied with this. They have higher requirements for the basic quality and token economy of games. Players will pay more attention to whether there is a way to solve the single-game economic mechanism, whether the game is more playable, whether it has social attributes, and so on. In this case, is there a way for players to push the process themselves, choose the chain games that they like in all aspects, and participate in the development process? This is what Block Ape Scissors is doing.
Block Ape Scissors is a game community platform based on BNB Chain. It was announced on November 15, 2021, incubated by Binance Labs, and the vision is to provide players with entertainment and create lasting value through innovative mechanisms and carefully designed game experiences. It is committed to building the most diverse and advanced Play to Earn ecosystem. The platform introduces DAO governance model, breaks the traffic barriers and monopoly of traditional game platforms, provides more opportunities for emerging developers, and provides players with a safe, fair, and fun game environment.
One of the most important features is the DAO governance model. Players can obtain token staking rights by purchasing platform equity cards called “Ape Banana miners”, which use a POS mining mechanism. Block Ape Scissors adopts a sharing economy model that encourages community members to participate in platform construction and operation. Participating in the game, contributing content, and participating in governance activities can also earn a certain amount of platform token $Banana. Developers can also earn Banana by contributing games or providing services. This sharing economy model encourages community members to actively participate and promotes a self-sufficient and sustainable ecosystem.
Community members and independent game developers will “act separately.” For independent game developers, they can upload their demo works in the form of proposals at a fixed time each month, and then Block Ape Scissors DAO will process these proposals. Community members will select the most attractive and playable games through community voting, and then Block Ape Scissors will incubate them to help developers complete the construction of the entire game and then recommend them on the homepage of Block Ape Scissors.
During the voting process, all members of the DAO organization participating in the vote can enjoy the profits after the game goes online. For example, when Game A is selected by voting and Block Ape Scissors incubates it, when Game A brings in a profit of $1 million, Block Ape Scissors can obtain 25% of the revenue (to support the further construction and expansion of the platform), the Block Ape Scissors DAO treasury can obtain 15% of the revenue (used for DAO organization contributors’ salaries and some proposal expenditures), and DAO organization members can obtain 10% (receiving revenue according to their corresponding voting rights). The remaining 50% will be used for repurchasing and burning $Banana (to accelerate token deflation). (The above data is for example, and the exact data is subject to official announcement).
It can be seen that community members and independent game developers are taking different paths to the same destination. The project party and game players are no longer standing on the opposite side. The entire Block Ape Scissors ecosystem will work together to develop games that are more suitable for the current chain game market. Whether pursuing game playability or a closed-loop economic model, community members will vote to select the chain game they want, or in other words, profit-driven games that can help the Block Ape Scissors ecosystem gain more profits.
Furthermore, for a blockchain game with financial attributes, game fairness and validation of transaction effectiveness are crucial. Block Ape Scissors uses zk-SNARKs to achieve fast and efficient gameplay, allowing for the processing of large volumes of transactions in seconds while maintaining transaction privacy and verifying their correctness.
Block Ape Scissors is also exploring AI, and in the future, will train an AI robot to generate different economic models. DAO members will vote each week to choose the one they believe is better, helping the AI robot continuously optimize and find new solutions for GameFi.
Web2 large game companies, such as Ubisoft and Lilith, are also seeking opportunities for change.
It is worth mentioning that according to the Block Ape Scissors team, they maintain good relationships with many Web2 large game companies and will gradually transform several games IP that were once popular around the world in the next six months, bringing more players from traditional fields into the crypto world through games. Web3 games may break through the predicament of traditional game buying methods (namely attracting players through paid advertising, etc.) in their business model and subvert the traditional profit distribution structure, providing developers with more monetization opportunities and creating new markets for the gaming industry. The transition from Web2 to Web3 games may be an opportunity for Block Ape Scissors to overtake its competition, and the “big reshaping” of BSC chain games may be just around the corner.
The Opportunities and Challenges of GameFi in the Future
On May 25th, Polygon co-founder Sandeep Nailwal stated that “Web3 games are one of the biggest drivers of cryptocurrency adoption on a large scale. In the next 6-18 months, some top games will be released on Web3. Last year alone, the financing funds for Web3 games exceeded 2 billion US dollars.”
Currently, the entire history of the gaming industry has reached a critical turning point, and the gaming industry urgently needs to bridge the gap between Web2 and Web3 and enter the era of blockchain gaming. Given the playability and economic value of gaming and NFTs, GameFi provides an opportunity to bring the next tens of millions of new users into the cryptocurrency field. Looking back on the development process and development cycle of GameFi, the bull market in this niche may already be stirring. We bid farewell to the barbaric development of the GameFi first half. Who can achieve paradigm shift and open up a new round of innovation and growth for the sluggish market? Let us wait and see.
Reference
The ZK-Snark Gaming Revolution
Discussion on the inspiration of Gala Games’ rise to Project 12
Web3’s STEAM? – In-Depth Analysis of Treasure DAO
Understanding the evolution of Treasure DAO in one article
Revealing the business model of blockchain games
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