If you’ve been following our blog, you know that we like to dive into all aspects of blockchain gaming, especially in regards to what’s great about it for players. In some of our previous posts, we’ve explicitly discussed the value propositions blockchain can bring to games (go check them out if you didn’t yet). Now, every now and then, when reading about blockchain gaming, you’ll stumble upon the term “play-to-earn”, and often also how great it is that blockchain enables this in games.
In this post, we want to briefly talk about what “play-to-earn” means, as well as our opinion about how important it is in the context of a game’s value propositions.
Make money from playing
The term “play-to-earn” is pretty self-explanatory, isn’t it? As a player, you’ll be able to earn (real money) from playing a game. So far, so good.
In the blockchain gaming world, there are generally two different ways of how that can happen in a game:
- Earning a form of cryptocurrency from playing. Very often, those currencies or tokens are proprietary to the game/ecosystem. But since they can be traded, you’ll be able to convert your token earnings.
- Acquiring and owning collectibles that’ll increase in value over time. This is a popular one since collectibles are such a good fit for blockchain. In the broader sense, collectibles can also mean in-game items, since blockchain basically allows to make any in-game item a collectible.
As a blockchain game developer, you’ll inevitably have to deal with value, value transitions as well as its development over time, and incorporate it into the game design in a meaningful way. And when there’s value, which can be transferred, “play-to-earn” will become a topic to consider.
However, in our opinion, play-to-earn isn’t necessarily the logical consequence of making value an important part in a game design. It’s something to consider, that can be allowed, or prevented, but it shouldn’t become part of the game’s core selling points or value propositions.
Let’s talk about why we have that opinion.
The problem with play-to-earn
Value doesn’t just magically appear out of thin air, not even in blockchain. No matter how you earn through playing, via a token or a collectible, you’ll only be able to earn something if there’s someone else who’s willing to pay for that asset. So, ultimately, the value of your asset will always be determined by the demand for it.
Thus, if earning real value is a major reason for playing, what you’ll want is an economy where there’s a lot of demand for the assets you’re trying to sell, right? Prices will only be comparably high if that’s the case. Now, imagine “play-to-earn” is one of the prominent key features of a game. A good part, maybe even the majority of the player base will play due to the promise they’ll be able to earn. However, generally those people will more likely try to sell assets (get value out of the system) than buy something (put value into the system), right? See the problem?
Play-to-earn only works in the long-run, if the majority of the player base is willing to spend more than they earn. Also, let’s be honest, play-to-earn, in general, is only attractive if you’ll be able to earn significantly, right? But, following our argument from above, that’ll most likely only be the case for a quite small group of players.
Sustainable demand is key
No matter if talking about a collectible game, or any other blockchain game that may allow you to earn money with it, sustainable demand for the game asset(s) is key. Now, how can sustainable demand be achieved?
That’s a topic for a whole series of posts, but let’s try to put it in a few, simple words: It’ll result from building a fun game that’ll create and grow in interest (demand) over time. And since we’ve learned that the majority of the player base needs to consist of people that don’t just play due to the “play-to-earn” value proposition, the game needs to offer other aspects that attract players. Play-to-earn then becomes an implicit feature of the game, rather than a core value proposition.
Let’s take a look at an example from the traditional world: baseball trading cards. A good part of their popularity is due to the fact, that there are valuable cards, that sell for extremely high prices. However, the vast majority of the demand for the trading cards is not because people expect to make money from them, but because they’re interested in baseball. Only because there’s continuous interest in the topic, resulting in sustainable demand for the trading cards, some people will eventually be able to make significant money with them.
The relevance of “play-to-earn” in blockchain games, as described in this post, is merely our personal opinion. At Chain Clash, we’ve made it part of our game design philosophy, to treat it in the way we’ve described here. If you disagree, or just want to share your opinion on the topic, let us know your thoughts and experiences in the comments or on Discord!
If you’re interested to learn more about what we’re doing at Chain Clash, and how we’re designing our game, stay tuned on our blog!