How we traded a million Minecraft blocks in Bitcoin
A story of supply and demand of voxel goods.
The Minecraft server BitQuest was conceived in the offices of MEGO at a time we were obsessed with the game but disappointed with its economy system of almost random, meaningless trades. So we decided to take matters into our own hands and write a mod that could determine the supply and demand of blocks so players could trade their findings and crafts in a “block market”.
What sounds simple enough turned out to be a hard problem: there are many ways to measure supply and demand and we tried every approach. Surprisingly, the simplest of all yielded the best results: Just like original Minecraft, blocks and items are traded by the Villagers in emeralds; But this time, according to four simple rules:
- When player buys an item, the price goes up (proportional to the price paid)
- When player sells an item, the price goes down (proportional to the quantity sold)
- When villagers run out of item, they stop selling; When they have too much, they stop buying.
- Villagers will buy low and sell high, and keep a “wallet” with earnings for buying more stuff.
To make things more exciting (and dangerous) we created an in-game bank where you can deposit Bitcoin in exchange for emeralds and vice-versa. That way you can cash out your earnings or gracefully waste your hard-earned BTC. We also decided one emerald should be 1 bit (thats 1 millionth of a Bitcoin) so no big amounts of money are ever traded inside the game.
Since we are also data nerds, we gathered all information we could over the past six months, in order to learn as much as we could. It turns out using a game currency you can cash in and out was a very successful idea and here’s what we’ve learnt so far:
The average block price is 23 bits
Or at the time of this writing, $0.006813 USD. Sounds very inexpensive, but if you want to build a huge project you’ll need a lot of blocks. 23 bits is also the price for a nice, diamond chestplate. A total of 194,000 transactions were made by 6,536 players and the total sold was 1.54 BTC.
The most expensive block is Quartz, at 45 bits
One key element of pricing in economics is scarcity. To find Quartz in Minecraft, one must go to the nether, a hellish parallel dimension full of creepy demons. And we took it a little further and made that area even more difficult, almost impossible to survive. Sorry about that.
That drove the price of quartz so high it became a luxury item, the status symbol of the server. Surprisingly, diamond is a close second, a much more useful resource but also easier to find.
Bitcoin can be burnt
One of our most active players decided it was time to burn some cash. So he converted 0.25BTC to emerald blocks and threw them on the lava.
When BTC is converted to emerald is sent to a “world wallet” so that money burnt didn’t actually disappear but went to others when converted back to Bitcoin. However, he might be the first person on earth to literally burn money on the internet.
Collaboration wins against crime
In BitQuest players can claim their land and settle in a protected area, but all the other parts of the world are public. That means citizens can either build cool public projects or break them to trade for bitcoin. At first we were expecting complete chaos but the outcome was suprising.
Most players prefer to collaborate on public projects and griefing is a rare incident. Together we built a massive, perfectly designed subway system, giant sculptures and amazing cities. When we became aware there is an incentive to destroy them for an easy buck in the market, we chose “mayors” for each city, who volunteer in keeping an eye on criminals and all of them are caught and sent to virtual jail.
Our best selling item is the apple
Over the last 6 months we sold a total of 159,661 items, a total of 1.54BTC, with all of it being re invested in buying other items from players.
The most popular buy is a ubiquitous consumable, and the cheapest food in the server: apple. Very close with the second place is the luxury status symbol quartz. The top 10 is a perfect mix of low priced and expensive items:
- Apple (1162 sold)
- Quartz block (1015 sold)
- Carrots (983 sold )
- Golden Apple (445 sold)
- Bread (424 sold)
- Diamond Chesplate (422 sold)
- Diamond (392 sold)
- Diamond Sword (283 sold)
- Diamond Leggings (282 sold)
- Sea Lantern (276 sold)
Buying a lot of apples is an unexpensive way to carry food in your adventures, so it makes complete sense.
Bitcoin can be the official currency of virtual worlds
The making of this server was not only very fun; Using an open, internet native currency was the very thing that made this project possible. We wouldn’t stand a chance complying to payments processors or running microtransactions on credit cards that could be stolen or charged back.
Players found a way to spend (or win) very small amounts of money without giving their payment credentials to third parties, using a simple QR code to deposit to their BitQuest wallet from their phones. And no fee was paid to Visa, Paypal, Apple or the CEO of Bitcoin.
But the best part is that for the first time a game currency is not a product to sell or a “pay to win” scheme, but the veins of a proper economy. Game money sucks because it’s all on walled gardens, and we believe multiplayer games of the future will use only one open, transparent currency that will work as your virtual world passport.
We will continue to improve BitQuest for a long time, but I also hope to see many games with Bitcoin as the currency in the near future.
