Recently, game financing is very hot. According to the data of Footprint Analytics, it is still at the bottom in 2020. In 2021, the game has ranked first, accounting for nearly 13% of all investments.
What is GameFi
The popularity of the encryption world has gone from DeFi to NFT, and now it has reached GameFi. No matter which industry masters the heat, the password of the traffic is mastered. In the second half of the year, Axie Infinity once again detonated the popularity of GameFi, with a maximum daily income of 18.48 million U.S. dollars, and even surpassed the glory of the king. What is GameFi?
GameFi, or Game Finance, was first proposed by Mary Ma, Chief Strategy Officer of MixMarvel in 2019, to integrate finance into the game. And how to achieve it? The props in the game will be NFTized, and the liquidity mining game of DeFi will be regularized, and wealth can be realized through the game (Play to Earn, or P2E). Driven by liquidity mining, GameFi, a game model combining NFT and DeFi, has been further developed.
Compared with traditional games, GameFi has the following advantages that cannot be ignored:
-Ownership of assets In GameFi, through smart contracts on the chain, the assets of the game belong to the player rather than the developer, and the player truly owns the ownership of the game assets and can conduct transactions at the same time.
-P2E achieves a win-win situation through the ownership of assets, so that players can realize assets, whether it is in-game NFT or game tokens, they can trade to earn income. This new model enables developers, players, and publishers to achieve a win-win-win situation.
-Data Open and Transparent The essence of GameFi is the distributed management of the blockchain. The game code is open source and transparent, and developers cannot tamper with it at will. As a player, you can also vote to participate in the upgrade and transformation of the game through DAO, which further increases the player’s participation.
Compared with DeFi, GameFi lowers the threshold for users to enter the blockchain world, simplifies finance through games, and enables the blockchain to quickly “out of the circle”.
In the current period when various public chains are emerging in an endless stream, different public chains are constantly introducing new ones in terms of differentiation. In terms of the stable currency public chain track, the Terra chain rushed to the third place in the public chain TVL at the end of August, and then the Celo chain, which focuses on decentralized mobile payments.
Also in GameFi, a good GameFi project can also become an ecosystem, and even some nameless public chains. The sidechain Ronin built by Ethereum for Axie Infinity can illustrate this point. The WAX chain and the NFT-based Flow chain are also one of the more popular public chains.
Ethereum still occupies the top of the public chain TVL with an absolute advantage, but the low transaction speed and high gas fees have become an obstacle for ordinary users to enter the blockchain world. And BSC continues to exert its strength on chain games with almost 6 times the throughput of Ethereum. Currently, 195 game projects have been deployed on BSC; according to statistics from Dappradar, BSC occupies 4 places in the top 10 games. .
Reason 1: High transaction efficiency, low gas fee
Ethereum ranks first in terms of the total number of TVL and unique addresses, but from the perspective of the number of unique active addresses and daily transaction volume, BSC completely surpassed Ethereum in April and February this year.
On the active address, Ethereum fluctuates between 400,000 and 600,000 daily, and BSC fluctuates between 1.5 million and 2 million daily, which is basically 3-5 times that of Ethereum, and the daily transaction volume is even as much as 13 times. .
Footprint Analytics: the only active address in 2021
Footprint Analytics: Daily transaction volume in 2021
Compared with Ethereum, BSC has higher transaction efficiency, lower gas fees, and is also compatible with the Ethereum virtual machine EVM, which allows Ethereum developers to migrate to BSC at low cost and attract more casual users to enter To the world of blockchain. Looking at the entire ecosystem of BSC, from resources to infrastructure, it is more friendly to the development of game projects.
Reason 2: Incubation funds, hackathons and other incentives
In order to encourage the development of the entire NFT ecosystem, BSC officials also launched the Most Valuable Builder Program “MVB II”. Selected projects can receive incubation opportunities such as USD 10,000 in seed funds and full audit fee support.
In July of this year, BSC announced the list of winners, including currently popular chain game projects, such as CryptoBlades, MyDeFiPet, MOBOX, X World Games, etc. In the next MVB III plan, it is directly positioned as GameFi, and I believe BSC can once again detonate the GameFi field.
BSC regularly organizes global hackathons and also launches Learn & Earn activities. At present, out of the 9 projects in the 2 phases of Learn & Earn held in China, 4 projects involve games or NFTs. Among them is the CryptoBlades, which skyrocketed in July. By rewarding unique NFTs and bonuses to encourage users to participate in excellent projects, BSC is simply fertile ground for the growth of GameFi.
The top 5 games currently ranked on BSC in the past 30 days are CryptoMines (ETERNAL), Mobox (MBOX), Bomb Crypto (BCOIN), BinaryX (BNX) and MetaverseMiner (META).
With the continuous increase in users and transaction volume, the price of the game’s native Token has also been rising. Among them, the craziest increase is the original Token ETERNAL of CryptoMines, whose price has far exceeded AXS. As of October 24, the price of ETERNAL was US$572, which was 16 times that of a month ago. For players for P2E purposes, there will be no small gains.
Footprint Analytics: BSC’s top 5 game token prices
Problems in rapid growth
The GameFi project, which has received a lot of attention, has faced many problems while continuously injecting capital into the limelight:
The player base is still small
Let alone the 3 billion players of traditional games, GameFi’s user base is still very small compared to DeFi users. In the era when mobile games occupy an important market, most of the chain games are still based on page games, which seems a bit “simplistic”, which makes the group of players who have been accustomed to mobile games such as mobile games returning to the web side even smaller.
Although the barriers to entry into the crypto world have been lowered through games, concepts such as cryptocurrency wallets, mnemonics, and gas fees are still obscure compared to traditional games. At present, more chain games are more attractive to players in backward areas. The global economic downturn caused by the epidemic has caused many people with no income to join the gold guild to make a living.
Congestion and high transaction fees
Due to the high performance requirements of the game, frequent transactions also have higher requirements for the transaction speed of the network TPS (Transactions Per Second) and Gas fees. As a result, many players leave Ethereum to seek better side chains or other public chains.
The popularity of Cryptokitties in 2017 caused serious congestion in Ethereum, and the migration of Axie Infinity to sidechain by Ethereum proved the importance of public chain infrastructure to the development of GameFi.
Poor playability and insufficient stickiness
Even the most popular GameFi project is still very simple in gameplay compared with traditional 3A games. In order to catch up with the popularity of the market, the game has been continuously integrated into many different games, and it is more like a liquid mining project with a good-looking skin. Players who really love the game will not be attracted, but more “workers” who want to make money enter.
When the entertainment-oriented game turns the cart before the horse becomes a money-oriented job, the original fun is lost. GameFi is not game-based, but after Fi-based, is it play to earn or earn to play? This has led to the goal of making money for both developers and players. The games developed by developers are less interesting. Once the game fails to bring players enough income, players will move to other higher-yield projects. No stickiness.
After the smash hit CryptoBlades in July, the price and users showed a continuous downward trend. Although the project team worked hard to balance the game and making money, the player’s return rate continued to grow, causing more and more players to lose. more.
Footprint Analytics: GameFi Daily User Situation
The same happened to Axie Infinity. SLP is an important source of game revenue for players. When SLP drops, Axie Infinity’s revenue decreases. Axie Infinity once helped the Filipino people affected by the epidemic to gain wealth through the form of a gold guild, but now the daily income of players from the game is no longer than the local minimum wage level.
Footprint Analytics: SLP token price situation
In GameFi, players control the ownership of game assets through NFT and platform tokens, use NFT as a liquid mining tool, make assets liquid through DeFi, and increase the fun through game attributes while lowering the threshold, completing the entire GameFi closed loop.
Although there are still many problems with GameFi that need to be optimized, it is undeniable that this is also a track full of future. The problem of infrastructure will be further solved through Layer 2 and sharding technology, and the player experience will be optimized with the promotion of VR technology and high-quality games. As an important entrance to the meta universe, GameFi’s future also has a lot of room for imagination.
The last time the blockchain exploded was DeFi. After GameFi balanced infrastructure, playability, and return, I believe this explosion will be on the GameFi track.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/bsc-benefited-the-most-from-the-explosion-of-gamefi-chain-games-but-is-p2e-sustainable/
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