It is time for the Web3 Gaming industry to admit some harsh truths. One thousand projects have risen, some quite rapidly — but almost all of them have crashed. The “why” of this is simple but not very clear.
Play-2-Earn has a great concept. Earn money playing videogames! Naturally, the model is much more complicated than that. Money doesn’t just appear. There must be value. P2E gaming is not a good investment. “Oh Ihave not use for this $2000 parcel of virtual land. I am just betting someone else will be willing to pay $10,000.
In every ecosystem, there have been winners. Web3 games can often end up with a near zero-sum outcome — there must always be winners and loser. In worst cases, developers are the only ones who win. The developers who sold the project are the only winners, as they lose all their capital. I am not afraid to be unyieldingly open — my own project Draco Dice began in this way (though there’s a happy ending at the end). People believed there was an exit strategy that could be implemented, which allowed them to hoard thousands of digital die, so that when interest in the assets grew, they would have mounds and mounds of assets. I tried my best to discredit the notion that NFTs exist to make profit for everyone.
In the best case scenario, those who know better are the Web3 ecosystem “winners”. They knew that the money would run dry, that user growth would slow down, and that anyone still holding onto a bag would be carrying a useless bag. The smart ones made it easy to get out early. I have been humbled on this point too. I foolishly believed that assets I had worth tens or thousands of USD would go up by increasing user engagement.
Now that I have completely destroyed my own financial ethos here, I can now justify my faith in the winners of tomorrow.
Regardless of how unpopular the term is, I am a true “gamer” regardless of how embarrassing it may sound. Web3 gaming is not for everyone. Here’s a brief history lesson to help you remember.
How did we get here?
In the beginning, gamers owned physical media. Compact Discs and game carts were the first media that gamers owned. The Steam was followed by other large platforms that took over digital distribution. The majority of the games that were not physically manufactured could now be downloaded digitally. The license can be revoked at anytime and for virtually any reason. Consumers now have fewer rights with Gaming as a Service becoming an industry standard. The developers can take down your online experience and all the effort you have put in to it.
Also, gamers don’t own anything but their hardware (though that could be argued due to EULAs or ToS supplied both by OS and console manufacturers).
I am in deep gaming hell and I will never get out. My skin has turned a pale yellow and my eyes have become more sensitive to the harsh blue light from the screens. The potential for increased agencyfor gaming enthusiasts offered by Non Fungible Tokens is immense. You can think about it again: could actually own the actual games. We could really ownassets, which we earned or bought within a game. And even take them outside the game to get more utility. Instead of making illegal transactions on black market websites, we could sell them with developer support. We could also resell the games if we are done with them.
If you’re like me and love to play games, you will find this vision for the future inspiring and motivating.
Comparing it to the reality that Play-2-Earn did for us, however, you will see something terribly, terribly wrong.
Fun-filled Reality Check
The P2E sector should have learned the first lesson, that games should be entertaining first and generate revenue second. Web3 gaming has been dominated by button-clicking token manipulation instruments, with the exception of the mentioned exceptions. However, even then, “fun” continues to be an afterthought for most Web3 games. Because they are having fun, nobody has been playing this stuff. Everyone is after the sweet, sweet tokens. It’s all rocket emojis. All you have to do is call HODL.
There is no way to make a living playing video games. It’s a fraud and a liar. It’s a scam and a lie. Recognizing this truth was transformative for my life. I discovered that Play-2-Earn is not available to real gamers.
Believe me gamers can smell bullshit. Web3 has received a bad reputation for exposing endless scams and pump and dumps. P2E is no exception. This is right.
Both you and I see the benefits gamers receive by engaging in a Web3 community. However, Web3 gaming cannot be all about Web3. While there’s no Play-2-Earn, we can still provide agency and revenue. You don’t have to stop selling games because they can still make money. STOP IT! You must stop trying to disrupt the gaming industry.
This is where the gold is. Web3 allows you to create amazing games and add Web3 utility.
I had already promised a happy ending. This is what my team and I have been working towards. While we sell NFTs, they are not the main focus. They’re not the star. It is only a game that players love that they want to play again and again that can be sustained. It’s not important that I take a negative view of the Draco Dice’s launch, even though it was a huge success. The important thing are the NFT benefits that can be conveyed to players.
How to Save Web3 Gaming
Draco Dice was created to standardize gaming assets that are useful in more than one game. In just a few months, this is becoming a reality. We’ve simultaneously been working on Draco Dice: Skrimish and Draco Dicesweeper. Both can be played using the same Draco Dice (NFTs) — offering real, undeniable utility in a vastly different world of video gaming. Now what?
Web3 should approach gamers right where they are. Gamers are not interested in tokens, wallets, and exchanges. They don’t care what financial nerdiness we use to make profits. Gamers care more about the game. I am not suggesting that Web3 technology be hidden — I just suggest that gamers use the language they are familiar with. Gamers understand XP levels, battle passes, currencies, and even markets — but it’s on us to streamline the experience of interacting with Web3 to break down what would otherwise be considered barriers to entry — such as requiring the manual creation of a wallet on this — or that chain beyond the username/password/2FA structure to which gamers are accustomed.
Lastly, speculation must end as quickly as possible. The purity of a product intended for entertainment is compromised by retail investors. A community of people looking to make a profit is not the same thing as one that is full of people wanting to see the latest content updates. One is here for the fun. The other is only here to make money. Retail investors’ ability to exaggerate the gaming NFTs’ perceived value must be directly challenged.
It is best to reward gameplay and not offer any high-ticket assets. Although retail investors have access to high value assets in many other places, if we want to get into gaming, only players who are skilled, advanced, and participating should have this kind of power.
If this is the case, you might wonder how Play-2-Earn can survive. But the truth is that Play-2-Earn has already been pushed in this direction. Splinterlands was built on great gameplay and the intention of having fun. Both must they continue to sell new assets to remain afloat? Yes. However, this isn’t any different to other game developers who have to release regular DLC, battle pass, and other microtransactions. It is essential that the revenue flow.
Web3 and Play-2-Earn are dead. There is money in P2E today, tomorrow and the gradual decay of the bear market will occur. But, just like wise men suggest that you view the bear market a “build market,” I have to point out the fact that the meat has begun to rot. Flies are not good indicators of health.
Web3’s future champions can build better products or services than these, and they are doing so now.