NFTs and P2E in Gaming: New Ways to Play, and Win
There’s something specific happening right now with digital gaming, and it has to do with blockchain assets.
Some of the biggest proponents of new decentralized finance systems for gaming are coining a term called GameFi, and a related idea called Play to Earn (P2E). This is based on the ways that cryptocurrencies and NFTs can monetize certain types of digital gameplay. These new trends could have a huge impact on how gaming platforms will look in just a couple of years.
The popularity of Crypto Gaming
Some observational estimates suggest that right now, there are 1.4 million online crypto wallets currently connected to gaming applications, with more on the way. Enthusiasts are referring to 2022 as the ‘year of the metaverse,’ although we’ve heard that sort of thing before where 2018 was supposed to be the ‘year of Bitcoin.’
In reality, trends tend to move a little bit slower than that, but it’s undeniable that new GameFi gaming models are taking on.
The principle of play to earn is quickly emerging and changing the ways that gaming operators and players use NFTs and DeFi assets.
Play to Earn is the idea that you gain some sort of value as you move through a gaming universe, or participate in gaming user sessions. It’s fed by the philosophy that gaining value in this way keeps players engaged, and rewards them for spending their time in a particular digital environment. And it’s making a lot of sense to gaming operators.
Casino Games and More
In a lot of ways, casino games led the charge when it comes to Play to Earn.
A couple of years ago, there was a big sea change starting among casino operators. Digital gaming companies found that they could keep players interested by offering a certain percentage of crypto yield in Bitcoin casinos, through the use of items like bonuses, freerolls and rakeback or chargeback offerings. It made sense – unlike the physical casinos of old, where the house always wins, new DeFi casino operations allow players to both wager and stake. And in this way, play to earn started to gain critical mass.
But play to earn isn’t just for casino games anymore. Now all sorts of different games, from action games to role-playing games, have P2E integrated into their structures through cryptocurrency and NFT possibilities. For instance, in the digital and connected version of Cryptotanks, players can accrue the $TANK token depending on user sessions and bank it up.
Another such game is Axie Infinity, where players cultivate their own NFTs to gain value. Players can build up Axie Infinity Shards (AXS) and Smooth Love Potion, and gain value through AXS staking, or by selling SLP. They can also “breed” Axies, digital pets with their own territory, and links to online NFT assets.
There are just a few examples of P2E in action, with NFTs representing some of the resulting ownership methods. Or, players can accrue tokens in active play.
GameFi and the Metaverse
Here’s another major driver that people are thinking about as the idea of owning NFTs in P2E environments becomes more appealing.
Essentially, we may be moving toward a new digital frontier called the metaverse. In this new virtual world, users will often be identified by their avatars. So it suddenly makes more sense to buy and own a piece of digital art that someone would use as their personal avatar on some particular platform. That has pushed the idea of visual art NFTs, debatably, more than things like CryptoPunks and CryptoKitties (although the success of the latter did have an impact on Axie).
NFTs and P2E
In some ways, it’s just a convergence of different tendrils of new blockchain technology.
“NFTs have created room for play-to-earn (P2E) games to flourish,” writes an analyst at the AAX blog. “These games break away from the traditional model by giving gamers rewards that have real-world value. With the popularity of games like Axie Infinity, P2E games are projected to skyrocket and trigger a significant wave of cryptocurrency adoption.”
In other words, the ability to mint and own NFTs was partially responsible for building these P2E games, where players are going to get value through these kinds of in-game creations. In general, a lot of in-game value plays have to do with aggregating particular tokens or digital assets within a particular digital game space. But other types of P2E dole out coins that one can easily trade for fiat on exchanges.
It’s a versatile concept, with a lot of different use cases. And it’s starting to become a more familiar part of the gaming world. So look for P2E to surface more and more in the online and digital gaming ecosystem.