Poke the bubble and count down the seven major problems existing in GameFi at this stage
Original title: Is GameFi dead? ——A detailed count of the seven sins of chain games"
Original author: Wen Xin
Well, that's all for the polite words. Do you think what I said above is true? Maybe many articles will describe GameFi in this way, and those who first promoted the concept of GameFi also explained it in this way, but this "good scripture" is getting more and more crooked now. It is undeniable that many excellent GameFi projects appeared in the last round of bull market, and they created a huge amount of wealth, but it is those popular "brands" that are pushing the industry into the abyss step by step.
GameFi peaked at the end of 2021 to early 2022, and has been on a downward trend since then. During this period, StepN caused a wave of XtoEarn, but with the withdrawal of Chinese users, it also plummeted. Now the overall market value of GameFi has dropped by more than 95% compared with its peak period. Of course, the reason here is affected by the overall market environment, but projects such as public chains and NFTs can be regrouped when the market picks up, but there are so many GameFi projects, and how many can be restarted after being reset.
I believe in the future of GameFi very much, and I have been deeply involved in many projects. The early stage of emerging industries will inevitably experience, but this does not mean that we have to make mistakes again and again! If you have a problem, you should face it and solve it. Blindly avoiding it will only magnify the mistake. In today’s article, I want to talk to you about the shortcomings of GameFi at this stage, and the loopholes that people choose to ignore.
1. Play to Earn gave the player a wrong expectation
From the perspective of industry consensus, the description "Play to Earn" can draw a very intuitive conclusion: playing games The goal is to make money. This is basically the "original intention" of all chain game players, and it is also an "advantage" that most project parties must focus on when promoting. But if making money becomes the only driving force for playing games, then what is the meaning of the existence of the game? Participants in a game can be roughly divided into project parties and users. The project party wants to make money by playing games, and the users also want to make money by playing games. So who do they make money together? This logic would not hold true under normal circumstances. If it is in the period of positive development and rapid expansion of the project, old users can still earn money from new users, but when the growth rate of new users decreases, this "lie" will be exposed immediately, which is a typical "Ponzi Scam" (Pond's is not necessarily all scams, and there is no need to "completely eradicate", reasonable application will have unexpected gains).
From the perspective of users, a concept that GameFi players attach great importance to is " "Payback cycle", that is, calculate the input-output ratio before playing the game. The 7-day payback is more attractive than the 30-day payback. As for what else can the game come with? None of that matters. Based on this situation, the project party's priority is to allow players to see opportunities to make money, and to maximize the initial money-making effect. Can this model be made? The answer is yes, there are many Token economic models that have the characteristics of short payback period, of course, the life cycle of the game in this mode will be shorter. Even if some games have been improved to delay the time of entering the death spiral, they still treat the symptoms but not the root cause, ranging from a few days to a few months. This is the status quo.
Looking at it from a higher perspective, GameFi is just a chain game (block chain game) A branch, the blockchain can not only add money-making effects to the game, but more importantly, the assetization of game props, the persistence of data and the definition of ownership. So I don't want to call blockchain games "Play to Earn", at least change it to "Play and Earn"! There is no problem with making money through chain games, but chain games are definitely not just about earning Tokens. Some players can aim to make money, but only when more people participate in chain games for other goals can a healthy ecology be created.
2. Using DeFi as the core of the game is completely different
GameFi generally just adds a layer of game shell to DeFi, and its essence is still the simplest DeFi gameplay. The basic process can be summarized as follows, The corresponding explanations are in brackets:
Token or NFT of the purchase project party is used in the game ( In essence, it is a pledge) All kinds of brainless and simple operations (GameFi features, additional and unnecessary steps) Breeding, upgrading, planting (disguised liquidity mining) to get more Tokens (staking rewards) in the game into a death spiral Exit before (withdraw investment funds in time)
So since DeFi is the core of the game, players The purpose must be to buy Tokens to get more Tokens. As for the process, of course, the simpler the better, it is best not to participate in the game. Therefore, almost no players pay attention to the game content of GameFi. The 3A masterpiece PVP battles that require superb operation may not necessarily be popular with farming games that only need to click. Therefore, overall, players prefer passive income, which makes the game design become " burden"! This kind of DeFi design can get more traffic in the early stage, but it will be harmful to the game's economy in the long run.
3. Using NFT as the threshold of the game is self-defeating
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Many GameFi will set an NFT as the threshold of the game. Players can only start the game by purchasing the corresponding NFT. Take Axie as an example , you first need to buy three Axies to fight in a team to get Token rewards, and you can also breed and sell Axies to get income.
Many friends may not think that there is a problem with the "threshold NFT", but if you think about it carefully, there is a paradox in this model.
First of all, we buy an NFT in the hope that it will appreciate in value, if the Mint price is 0.1E , we will hope it rises to 1E or even higher, which is what investors like. However, if this trend continues, the threshold of the game will become higher and higher, which will make it more and more difficult to acquire new users, and the entire game will be paralyzed.
If you think about it another way, the price of the threshold NFT is getting lower and lower, which will affect the acquisition It is beneficial for new users, and people are willing to try this low-cost game, but it is unfair to early investors, and if the NFT price of a chain game continues to fall, people will think it has gone to Decline, the departure of early investors will bring the game into a death spiral, which is the common ending of GameFi now.
4. None of GameFi's earnings are sustainable (none of Ponzi's are sustainable )
For game designers, Faucets and Sinks must be considered to balance the in-game economy of the two major elements. Faucets distribute in-game assets, and Sinks remove in-game assets from circulation.
For example, in "Glory of the King", you get gold coins for participating in the game. It's the design of Faucets, and you use coins to buy heroes and draws, it's the design of Sinks. It is best to have enough scenes in the game to consume the continuously produced gold coins, otherwise inflation will occur. This is not obvious in traditional Web2 games, because gold coins cannot be withdrawn and circulated, but GameFi is different. As long as the produced Token participates in economic circulation, its inflation must be strictly considered. If Token is seriously inflated, the game will also go to a death spiral.
In order to solve this problem, GameFi will design many Token consumption scenarios, such as StepN needs to use GST/GMT upgrades, Mint shoes, basically all XtoEarn projects now will mimic this design. But there is a fatal flaw in this. The purpose of consuming Token is to get more Token. Obviously, this design can only delay the bursting of the Ponzi bubble, but it will definitely die out in the end. When everyone abides by the rules and re-invests Token, it will be a prosperous scene, but as long as a large player leaves the market, it will inevitably be smashed and trampled.
Let's talk about "Glory of the King" here. All players will accumulate a lot of gold coins, but this will not affect the in-game economy. In the early days, players did not have enough gold coins to buy their favorite heroes. At this time, gold coins are scarce. Players will pay more attention to the income of gold coins when participating in the battle. But when players buy their favorite heroes, the main purpose of participating in the battle becomes victory and promotion. , the acquisition and quantity of gold coins become less important. In short, you can get gold coins in the battle, and the gold coins are used to buy heroes, and the main heroes are bought to win the game and improve the rank. This is a benign economic model.
5. Both single-currency and dual-currency economic models have flaws
The current GameFi economic model can be roughly divided into single currency and dual currency. And the improvement of the economic model presents a "repeating" law. The first batch of chain games basically adopted the single currency model, and then both new and old chain games began to switch to dual currency, but now more and more new projects use single currency. It can be seen that the economic model of chain games is still very immature, and both models have flaws.
First of all, let’s talk about the single currency model. There is only one kind of Token , it is produced through the game, and the number is infinitely increased. When the game is developing positively, the price of Token will rise steadily, game players and Token Investors will reap significant benefits. But when the growth rate of new players slows down, the inflation in the game will lead to a deterioration of the investment environment outside the game; conversely, the selling of pure investors will also affect the stability of the in-game economy, and for investors, Unlimited issuance of assets is not a good target.
Let’s look at the dual currency model again. Through the output of the game, sub-coins are issued infinitely, and are used for consumption such as upgrading of various props to balance the in-game economy; the parent currency is applied to the governance of the game ecology Token , the supply is fixed, and it is used for governance voting and investment, etc., which is one of the bearings of game value. For example, Axie has the mother currency AXS and the sub-coin SLP, and the sub-coin is like the single currency model Token Similarly, it is the main participant of the in-game economy and the main bearer of selling pressure; while the mother currency is more like an investment target, just like the stock issued by Web2 company. As for the function of voting governance, it is actually more like forcibly adding utility, I don't think many people buy a lot of them just to guide the progress of the game Token Bar.
The dual currency model is an upgrade of the single currency model, which separates games and speculation On the other hand, the inflation of the sub-currency in the game will not affect the price of the parent currency, and the selling of the parent currency by speculators will not destroy the economic ecology in the game. and a fixed supply Token It seems to be a perfect solution to appreciate more with the development of the project, but there are also obvious loopholes - the utility of the mother currency. As we said earlier, voting governance is more like a pseudo demand, which cannot be supported Token The price increase, and the one-coin-one-vote model is easily abused by whales looking for short-term gains. They can change the direction of the game design through proposals to benefit themselves or destroy the project, and then use Token Smash the plate.
In order to solve the above problems and give investors more reasons to hold the parent currency, a certain Some slightly professional project parties will choose to embrace the DeFi mechanism again, such as the Ve model. Simply put, you need to lock Token Over time, get VeTokens for voting governance and some Token Rewards (from the project treasury consisting of transaction fees, etc.). That is, if you want to have voting rights, you must lock Token , which reduces the Token Circulation, and can resist the destruction of the project by whales, making investors more willing to buy and hold for a long time Token .
However, the above design still does not give Token The actual application scenario still belongs to the Ponzi structure in essence.
6. Users are still highly overlapped with DeFi and NFT and there is no new blood
< p>Remember GameFi's vision? It wants to attract billions of gamers to Web3, but it seems that this idea has not been realized at all. The participants of GameFi are still NFT and DeFi players, so this is basically a game and mutual cut between existing users. Without new traffic, there will naturally be no hope of breaking the circle.
This reason may be answered in the first few questions, if the threshold of GameFi is to buy NFT , Using wallets and cryptocurrencies is simply a disaster for Web2 players, because the cost of passive learning is too high. Moreover, all kinds of GameFi itself are designed for Web3 players, and the gameplay is simple and boring. Why should such quality compete with various Web2 games?
Solve this problem and make Web2 players willing to participate in the game and even pay for a better game Experience, reaching this level, chain games can be regarded as entering a new era.
7. Work to Earn
Play to make money, what is play? At least it should be entertaining!
The ideal design of GameFi should be that players earn money while playing games for entertainment, or You can play the role of a merchant in the game, making and selling items that other players need to make money, but this is not the case at all. Most of the income comes from meaningless clicks, and players will not get spiritual satisfaction at all, so it is better to change Play to Earn to Work to Earn. I always think that the current GameFi gameplay is POW mining. All kinds of "work" paid by players are for profit, so how can this be called a game?
Written at the end
It is inevitable that there are some problems in the early stage of the industry, which is not terrible. The terrible thing is that everyone turns a blind eye to their choices. For the seven questions raised in this article, I will give my own solutions later, and I look forward to communicating and discussing with more friends. I hope that more excellent products will appear in Web3, and I will also personally enter the game and practice it myself.
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