Last year I heard a number of times that 2021 would be the “Year of GameFi.” And while there were some gains last year for the blockchain industry, I think largely it was a building year in preparation for a blockchain gaming explosion. To frame 2021 as the “Year of GameFi” is really premature considering the future it could hold. Although there were a number of indie game releases, there were no AAA releases, and very few of the games released last year are notable. The lifecycle of some of these new games has been so short that they would release and die within the same year! This has led to a slower onboarding of gamers, particularly those new to blockchain, than some expected.
So, What Does Blockchain Gaming Need to Catch On?
Well, from my perspective the two largest needs are proven Play-to-Earn (P2E) mechanics, as well as fun and more complex games.
Proven Play-to-Earn Mechanics
As mentioned above, there have been a number of games that have launched and died very quickly, as well as a number of games that are currently in free fall with their tokenomics. The models their devs chose have proven to be less than ideal, usually causing a big boom at launch, and a precipitous crash soon after. While yes, this can sometimes be attributed to user hype around the project, I believe the underlying issue is an in-game economy that is unable to support the vision of the developers. Recently I mentioned a very similar issue in my Thetan Arena article.
A crash in a gamefi economy is closely linked then with a crash in the player base, which results in the death of the game. No players, no game. In some instances, the tokenomics are built in a way where the game thrives as long as new players are investing in the game. This usually results in the first users making a good ROI (return on investment), while the latter users struggle to break even once the player base stops growing. This model of tokenomics presents itself in different ways, but is very popular at the moment.
I am not an economist myself, but it is clear that developers need to put more time and thought into creating in-game economies that can support the games they wish to create. It isn’t the flashiest part of blockchain gaming, but it is essential to the success of new projects. The foundation of the game economy needs to be cyclical, and there needs to be a compelling reason to spend currency instead of hoarding. This will be particularly challenging for the first games that make it, because blockchain gamers are first investors and love to hoard. So before blockchain gaming becomes mainstream, it will need to prove to its player base that it can handle robust game economies that can support the demands of investors, not only the average gamer.
Fun and Complex Games
The second thing blockchain gaming really needs to become mainstream is fun and complex games. These are two issues but I’ve put them together because they often go hand in hand. There are so many games out there currently that are games in title only. What I mean by this is from the exterior they call themselves games, but when you break them down they are extremely simple simulations. Usually, they involve clicking a button, waiting an hour, clicking a button, waiting two hours, etc. We will call these in-name-only games, clickers.
The issue with clickers is that they are unappealing to the masses, and they are only played for the payday at the end. They have no substance to them, but are currently the best option (maybe?) for those who are interested in games, and are interested in earning through blockchain. Maybe they are paving the way for successful game launches, but in the long run, I don’t see a future for them. The successful clickers have in some cases been wildly popular and successful for a period of time but usually end with a crash as the economy dries up. So yes, some people have made great money from them, but they so far are proving unsustainable as time goes on.
In order for blockchain games to catch on, we need games that would be fun to play, even without a blockchain component. Games you’d find in the top 100 of your mobile phone’s app store, or find on the front page of Steam. The blockchain component cannot be the only compelling piece to a game, because if it is, then as soon as the game becomes unprofitable it dies. In order to have sustainable blockchain gaming, we need games that are fun enough to survive a drought. Crypto can be very boom and bust, and if we cull games every time a bust happens then we won’t have the chance to see great games living and thriving on the blockchain.
Let us know what you think about the current state of blockchain gaming in the Token Gamer Discord, and what you think the industry needs to thrive.