Alien Worlds has been sitting on the podium for daily unique active wallets (dUAW) for years. Since its launch in late 2020, it has been derided as “not a real game”, a “clicker”, and a “Play-to-Earn fad”. And yet, its player base has not provided evidence that any of those comments are widely held. In fact, web3 gaming is a sector with absurdly high mortality rates, and yet Alien Worlds seems unstoppable, even during brutal crypto crashes. Why is that?
There are usually myriad reasons why a game fails, but only a few why one succeeds. What’s interesting, however, is web3 added an almost entirely new category on both sides of the coin: tokenomics. It is through thoughtful and well-executed tokenomics that Alien Worlds has been able to continue building for the past few years when many other projects went belly up, but it isn’t tokenomics alone that deserves all the credit.
I want to briefly preface this article by saying that it is “sponsored” because I have been compensated for writing it. That said, the entire idea behind this article is an idea I’ve had on my to-do list for some time and so I pitched it to the good folks at Alien Worlds, who nodded. This analysis and opinion is entirely my own.
Tokenomics: The Lifeblood of Web3 Games
You could be fooled into thinking that complex game economies that interact with fiat currencies are new, but they aren’t — web3 just changed them. Every popular multiplayer game in the past few decades has interacted with money above and beyond microtransactions. Whether it’s selling the game’s currency and game assets, or boosts and accounts — every leading multiplayer game has an economy revolving around it, even if it’s against the game’s terms of service.
MMORPGs combated some of this the only way they could: selling the in-game currency for fiat directly. This officially puts a price on the game’s currency and the economy is legitimized. That is, you can measure your earnings in-game against what they would be worth in fiat. This is tremendously difficult to execute without detonating the game’s economy, but games such as Eve Online have proven it’s possible, and there are few games that have their economy more front and center than Eve Online.
When it comes to web3 games and the metaverse, there is a magnifying glass placed over the game’s economy. Despite not being fundamentally different from the likes of Eve Online’s economy in a practical sense, the tokenization of the game’s currency does increase the rate at which it flows from person to person. The way in which a web3 game’s economy is seen is also distinct for one key reason: people who don’t play the game can invest in the token like any cryptocurrency. In fact, there was a stage during the last bull run when metaverse tokens were outperforming damn-near everything.
So, what does this have to do with Alien Worlds’ success and longevity? Everything. Most developers of popular web3 games are not financial analysts or economists, and yet suddenly, with some interest around their game, they were in control of a token with a not insignificant market cap. This is where so many games failed, sometimes rather spectacularly. In December 2021, I covered a web3 game that had seen surging popularity and a token price to match, but through one innocuous oversight by the developers, the token lost over 99% of its value in a matter of hours, killing the game.
You don’t need to be an economist to understand the ways tokens can topple the games. If the token is too abundant, it becomes less valuable, and earning it in the game is not rewarding. If the token is too scarce, the value goes up but getting it in-game is too difficult, and thus not rewarding. It’s a Goldilocks’ porridge scenario. But, there are myriad factors that run parenthetically to this, like trust, reliability, and growth. Alien Worlds has hit every metric flawlessly. The best evidence for this is seen by contrasting Alien Worlds with other popular web3 games.
Alien Worlds Is a Stable Boat in a Stormy Sea
Alien Worlds is praised for its popularity, but what impresses me far more is its stability. If there is an industry more turbulent than crypto and web3, I don’t want to go anywhere near it. This sector oscillates from euphoric to despair in cycles, punctuated by world firsts and then disasters at a rate that has made me look as if I’m aging in dog years.
Most coins are currently down by 90% or more from their all-time highs, the NFT art market has fallen off a similarly steep cliff, and the blurry metric of “attention” has gone with them. Most projects, no matter how iconic within web3 or objectively successful, have graphs that look like this:
Admittedly, Axie Infinity is an extreme example, but it’s a long way from an outlier. Other successful web3 games have similar-looking graphs, such as Splinterlands, Upland, and even the excellent Gods Unchained. This isn’t a criticism of these projects and it isn’t indicative of lacking quality — it’s merely a sign of the times. What it does highlight, however, is just how impressive Alien Worlds’ metrics are.
I will freely admit that I cannot explain Alien Worlds’ success with any certainty — I don’t believe anyone can — but there are areas where Alien Worlds patently outperforms most of the industry. Here are some key successes that go a way to explaining the Alien Worlds anomaly:
Token Price =/= Popularity
For a game that most view as a founding father of Play-to-Earn (though interestingly, I’ve never seen Alien Worlds use that term about themselves), it has done something unthinkable: decoupled its token price from user activity. That is, even though Alien World’s token, Trilium ($TLM), is -60% in the last year (Solana is -51%, Polygon is -43%, and Avalanche is -55% — gaming tokens have been hit hard), the UAWs and number of transactions is not correlated whereas other games have seen all of these metrics rise and fall with the game’s token price, hand-in-hand.
In a time where many web3 games have simply run out of runway or had to scale back to barebones, Alien Worlds has released major updates to the game, launched the Galactic Hubs grants program, and pioneered in-game DAOs, among other things. Very few in the industry have been able to do this.
Partnerships with Alien Worlds have been ramping up and we recently saw a crossover with one of the oldest web3 games, Space Misfits, as well as another hero of the WAX blockchain, Colonize Mars. Part of the reason for the influx of other interesting partnerships is the Galactic Hubs program mentioned above. Projects are coming to Alien Worlds with pitches for working together and receiving grants to do so. This would have been a nice initiative in the bull market, but right now, it can be a life raft for web3 projects.
The web3 community as a whole is a little too fragmented for my tastes, but it is nothing if not passionate. However, when “to the moon” tweets stopped seeming reasonable to even the most evangelic of crypto bros, many communities that orbited web3 projects simply faded. This has not been the case with Alien Worlds at all and, in fact, it has one of the most loyal communities I’ve seen in the space. One obvious reason is that as well as the game’s continued growth, Alien Worlds invests in its community both financially and with effort. This is what I would call a green flag!
Staying consistent in the most inconsistent industry on the planet is no small task. Most web3 games appear to spike with content patches, marketing efforts, and community engagement, and then fall into silence for a while. I have some sympathy here — it’s hard when your coffers are worth far less than two years ago — but Alien Worlds is like clockwork with all of the above. Being consistent reinforces the trust its community has.
Alien Worlds is a singular case, there’s no escaping it. When we were at the height of the bull run, Alien Worlds ruling the roost wasn’t all that interesting to me — it was an accessible, cohesive game that players could earn from. But, when the industry caught fire and earning in any meaningful sense from web3 games had, for all intents and purposes, evaporated, the expected downward trajectory of player activity and transactions surprised no one. And yet, as the wonderful transparency of blockchain shows, Alien Worlds continues on its path, bucking the trend, and completely unphased by the flames licking at its boots.
If you are looking at building a web3 game — or any web3 project for that matter — you would do well to model much of it on Alien Worlds’ fundamentals. It takes something special to rise to the top, but it takes something spectacular to stay there.