You know, in the early 2000s, when we used to have a PC consisting of a cathode ray tube monitor, Intel Pentium processor, 2GB RAM and CD drive, gaming used to be fun & simple. Kids in those days knew games like RoadRash, Serious Sam, and GTA Vice City and played them to the fullest with silliness & pure joy. They didn’t worry about frame rate or graphic fidelity; the play-to-earn model was non-existent. Gaming was purely about enjoyment, exploration, and the thrill of overcoming challenges.
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Fast-forward to today, and there has been a drastic shift in the gaming industry. Offline story-driven campaign games have practically vanished from the market, introducing a new era of decentralized gaming models. GameFi is the perfect blend of online gaming and decentralized finance, creating an in-game economy that benefits both parties. The concept is simple yet elusive. It introduces the idea of play-to-earn (P2E), where in-game activity offers the players access to digital tokens, rare items, and much more. Whatever you earn while playing the game is yours.
Understanding GameFi in detail
Blockchain technology and non-fungible tokens (NFTs) give gamers complete ownership in GameFi, and players may receive digital tokens while playing.
GameFi refers to a relatively recent idea that blends decentralized money with gaming. It stands for a brand-new class of decentralized applications (dApps) that aims to combine blockchain technology with the gaming industry. By creating an ecosystem for gaming that uses digital assets, decentralized finance, and blockchain technology, GameFi hopes to enhance the player experience and offer alternatives for payment.
How Does GameFi Work?
The main goal of GameFi is to give users modes to obtain resources and token rewards for their accomplishments and skills in the game. Play-to-earn games are a new category of gaming experiences that have gained popularity thanks to GameFi. Rewards for these games come in many forms, including digital tokens and in-game items like virtual land, avatars, armour, and outfits. Every project has its economy and mode of operation. Based on the blockchain, non-fungible tokens (NFTs) are exchanged on NFT markets and are frequently used as in-game assets.
These days, a game’s publisher usually uses a proprietary backend server to store and deliver in-game currency and objects. These virtual goods and money are stored on a computer that the game publisher controls completely. They choose who owns the digital assets, how they can be used, and what players can do with them. However, this is different from blockchain-based games.
Role of Blockchain Technology in GameFi
Blockchain is driven by smart contracts developed by reputed smart contract development companies. These contracts power the game and in-game tokens, achieving true decentralization. Decentralized finance, non-fungible tokens, and play-to-earn tools act as building blocks for GameFi. This blockchain-based earning model promotes open in-game economics with complete ownership over digital items and currencies.
What To Expect from GameFi
Over a few years, DeFi has garnered a considerable fan following, leading to a significant rise in adoption by gaming conglomerates. P2E is a perfect alternative to the traditional play-to-play models of the previous generation of video games. It allows for additional ways to make money by playing blockchain games. It might promote greater industry participation, which might result in higher adoption. NFTs are a means of encouraging ownership of virtual assets without centralized authority. However, there are drawbacks, such as the requirement for a balanced economy and the possibility of market instability.
It’s no secret that in-game currency and equipment can have significant value. Rarest skins for Counter-Strike: Global Offensive (CS: GO) may fetch thousands of dollars, and there are plenty of grey markets available these days to make it easier to trade in-game money, items, or accounts for real money. The sellers—those who have acquired these digital products due to their time, money, and effort invested in the game—are on one side. On the other hand, the buyers are the people who, for various reasons (such as restricted availability, social standing, lack of time for grinding, etc.), are prepared to trade money for the seller’s produced items.
In layperson’s terms, blockchain technology is the backbone that formalizes a market that previously received traction, denied access, and even restricted game publishers. Tokens are a technology that replaces gated items, currencies, and accounts.
Why GameFi?
Owning The Asset
By utilizing blockchain technology, in-game ownership is transformed from a privilege granted by the game’s developers to a fundamental right for players. In conventional games, players have little control over the virtual items they own.
On the other hand, blockchain games offer players ownership over their in-game property by utilizing the secure ownership records of blockchain technology. Changing from “no ownership” to “default ownership” gives players a new perspective worth their time in the virtual environment.
Open Markets
In-game currency and items are used as incentives for playing the game. Along with core gameplay loops, reward systems are a critical component of every game, giving players something to strive for and encouraging them to play more.
Users can make real money by playing games because these items or currencies may be purchased, sold, and exchanged on public blockchain markets.
Furthermore, the integrated link to a larger economy allows players to make money under the right conditions and with well-designed game economies. Although there is no assurance that they will be able to do so or that the things will hold any value over time, it is how the ecosystem works.
Gaming Incentives
Let’s say you have two similar games before you, but there’s a catch. While one is a centralized game, the other is backed by blockchain technology. Every aspect of these two games will be on par with the other, but you know what you will choose if you want to book rewards while playing.
Some prominent industry players have identified the market gap and tapped into the possibilities of the GameFi market. Rather than keeping everything to themselves, these industry players are leveling the field with gamers alike, giving them an option to earn while playing.
List of Popular GameFi Platforms
Axie Infinity
The strategy game Axie Infinity focuses on Axies, adorable virtual pets with axolotl-like features. In various game types, players construct three-person teams, purchase Axies from other players on the open market, and engage in team battles. Players can earn SLP, the game’s native currency, by winning fights and completing missions. SLP can be used for many in-game tasks like breeding young Axies and making runes and charms.
Gods Unchained
Gods Unchained is a collectable trading card game where NFT cards with different rarities are freely exchanged, bought, and sold. Players combine and match cards with varying powers and statistics to build their ideal deck.
Within the game, players combat against one another using their decks. Players move up the leaderboards and gain GODS tokens by participating in and winning games. These tokens can be staked as part of the in-game governance system or used to buy new card packs.
Sorare
Sorare is a fantasy sports game similar to traditional fantasy sports leagues. In Sorare, global players can collect NFT player cards and compete in tournaments based on players’ actual performance in well-known sports leagues.
Players earn higher point bonuses as the rarity of their cards increases. Points are scored based on the effectiveness of their line-up and the rarity of each card. Along with rewarding players for winning tournaments, new cards are sold in an auction-style format.
Why So Hype Around GameFi?
All games have a primary purpose: to entertain players. Despite GameFi being a novel concept for monetising gameplay, it retains the core ideology of gaming.
Game developers should adopt GameFi economies as a new standard to empower players who enjoy a game and work to progress in it. Players frequently hear that GameFi is bringing about a new player economy where they can play video games to replace their regular jobs. Although that might be feasible in future, the main idea behind GameFi is that it gives digital assets a sense of tangibility.
That’s why top DeFi game development companies are working round the clock to provide players with a unique gaming experience and passive income. Additionally, the $300 billion industry surpasses the common entertainment market, creating a never-before-seen demand for the 21st century.
Top industrialists are betting high on GameFi development. If you have the vision to lead this opportunistic market, connect with our experts today.
Nitin Gupta, the CEO of WebMob Software Solutions, is a visionary leader renowned for his innovative approaches to leveraging emerging technologies to transform businesses globally. Under Nitin's guidance, WebMob has evolved into a pioneer in fintech, catering to esteemed clients across Europe, APAC, and the Middle East. As a thought leader, he continues to drive WebMob towards new heights of success, cementing its reputation as an industry leader in the IT sector.