NFT Gaming Review: Nest Arcade

Note: I have personally invested in Nest Arcade. Regardless, this post includes my opinions on positives for the project as well as my authentic concerns. Please see this post for more detail on my ethical guidelines for content.

Important! I’m posting this close to when the first Nest Arcade game will go live with its beta release. In fact, there’s a good chance that it’s live as you read this. Holders of the MetaBirds NFT will be able to start earning their native $NEST token within the beta release! You can find the NFTs here on Magic Eden, then visit their Discord to know when it’s pushed live.

My first post here reviewed my Q1-Q2 strategy for NFT gaming, and Nest Arcade/MetaBirds hits every checkbox I look for when investing in a project. Before I get into the bullish details, let’s get into the top level summary.

Nest Arcade is a full suite of P2E games launching on Solana. As far as I can tell, they will be the first game on the network to launch straight to mobile. The first release will be a Flappy Bird style game, using the MetaBirds NFTs available here on Magic Eden. Over time, the team will be shipping more games to the P2E platform.

Now let’s go down the checklist!

Investors and Core Team

I’ve been scaling into this project for a while and keeping tabs on their Discord. Over the last month or two leading to this beta release it seemed like there was a new investor or partnership announcement from a major player every few days. So they’ll have the resources and funds to build this the right way and hit their releases.

Most of the team leadership is doxxed, and features experienced professionals from the fields of mathematics, AI, marketing, acquisition, mobile/web game design and brand development. Their investment and advisor team includes people with a strong background in launching blockchain and crypto projects. Good stuff all around with each aspect of the industry covered.

Keeping it Simple

Like everyone else, I’m experiencing some massive fatigue from all the new NFT gaming projects minting on a daily/weekly basis.

I’ve noticed a recent trend in this latest influx: some projects have amazing graphics and cinematics, but very little when it comes to roadmap, team, whitepaper or gameplay footage. For me, this is a transparent tell of “We can’t start building anything until we get the funding needed from the mint.”

Not to FUD those projects at all — I hope all of them succeed! And I’m not giving up on any of them. My plan is to track their progress and start jumping in on their secondary market NFTs once they’ve shown good progress with building out their project.

None of this is a concern with Nest Arcade.

They have a big team. They have investors. They have a thorough road map, tokenomics breakdown, long term vision, NFT value prop and use case for their tokens.

They’re able to do this because they’re going with a game design/concept that can be readily and reliably delivered. And that’s with a sizeable team and funds to pull it off! As much as we’re all cheering for ambitious titles to put in the work and revolutionize the game industry, the projects I’m targeting in the first half of this year are ones that can deliver on their vision by keeping it simple. Nothing is a 100% guarantee, but I’m fairly confident Nest Arcade will ship their releases because their ambition is within their capabilities.

And simple doesn’t mean games need to be boring either. If you took a random survey of the overall population, I’m sure you’d find more people who are receptive to the simplicity of mobile games than the complexity and steep learning curve of AAA titles.

Excellent Value Prop

Nest Arcade just might be the best value prop I’ve seen so far in gaming NFTs. I really appreciate that their whitepaper has a lot more information on their NFT + native token utility than you’ll see from other projects in the development phase.

The question of “What do I get with my investment?” is absolutely front and center here for potential buyers.

A brief overview of NFT value:

• MetaBirds NFTs have a limited quantity of 1,600 available.
• Anyone can play their first Flappy Bird derivative game for the native $NEST token. However, non-holders will only receive 10% of game rewards compared to the NFT holders.
• Quarterly airdrops for NFTs that will be used in future game releases on the Nest Arcade platform.
• $NEST token airdrops.
• NFT breeding, renting and staking.

Tokenomics/NFT Value

Most startup crypto projects have tokenomics that are slanted to the team and/or seed investors. Nest Arcade is no different, though it’s not nearly as bad as other crypto coins— I’ve seen my fair share of excellent projects with a 2% public allocation that sees retail investors get crushed by the down-wicks that follow every pump.

The Nest Arcade distribution is more equitable, if not the perfect retail ratio we’d all want. This is a price I’m happy to pay for an investment team that will help reliably launch a finished product vs. a bootstrapped one that can completely fail with one misstep.

And the thing is, I really don’t care all that much. The big difference for me is that unlike a crypto token project, Nest Arcade provides value in the game’s NFTs. With the limited number of 1,600 available for full earnings, breeding, staking, free $NEST tokens, renting and airdrop NFTs for future games on the platform, there’s enough value in the NFTs for holders that I’m unlikely to be concerned by the market for the native token. The company’s profit percentage on NFTs won’t be something slanted, just the usual 5% royalty that we’re all used to.

This does of course add more strength to the value of holding an NFT within their ecosystem vs. the token economy that many players will need to focus on. In some ways it seems similar to the Axie Infinity model Dan Olson mentions here of NFT holders making profits with little effort while non-holders put in more work.

But hey, this is the model for Nest Arcade. I think it’s a bit silly to make a moral argument against it like Dan does in his video, as it doesn’t apply to many other new NFT games. I’m a holder, I got in early and won’t feel guilty about the potential ROI I’ll get for being an early investor and believer in the project (just the same as the financial investors benefit from getting a head start on the token).

Also FYI: there is no difference in rarity between the NFT MetaBirds, either in-game or with airdrop quality. So aside from aesthetic/collector value, sweeping the floor will give you the same bonuses as hunting rares.

Dex in Design

I love when a project mentions a dex swap in their whitepaper, as it shows they’re prioritizing a SOL/USD value for their native token. That’s the case here, and I’d imagine it will be ready to go either at launch, or soon after. They even quote projected viable rewards of a few hundred dollars per month in their whitepaper.

Designed for Phone Screens

Many NFT gaming projects are lining up Android and iOS releases to go along with tablet and desktop (where applicable). Nest Arcade is the first project I’ve seen specifically designed to be played on a phone.

This is a bigger advantage than you might think. There are countless games that are staples on tablet devices. They’ll often have a phone version as well, but just don’t work in the small confines of that small screen.

The games on Nest Arcade are designed specifically with that smaller space in mind, and that will make them a go-to option for P2E whenever a player doesn’t have access to those other devices. Scaling up from there to tablet and desktop is easy. It’s scaling the other way down that causes problems.

Pick Up and Play

On subject, the mobile format of low time commitment pick up and play games is a niche that Nest Arcade looks to have early advantage of in the P2E space. We all have a go-to game for those moments at a doctor’s office or or waiting for a bus where we get tired of social media scrolling and/or the internet connection isn’t very good (my personal favorite is a flick kick field goal game). If you’re in that kind of situation, why not collect some $NEST tokens for your efforts?

They are planning a desktop version of the app as well, but I’ve got to think the phone version will get the lion’s share of play.

Mainstream Adoption

If you have kids, you’re very familiar with the advertising strategy of many mobile games. They’re playing Subway Surfer and get caught. If they watch X number of videos, they can respawn from that same spot, and then carry on. These ads are almost always for other mobile games that the user can click and download to try. Sometimes these ads are just a straight up requirement to play the free version.

Either way, this is an existing dynamic players are very familiar with, and it positions Nest Arcade well to bring in a wide mainstream audience — possibly bigger than any we’ve currently seen for NFT gaming. “Play this game to earn real money through crypto!” is an excellent elevator pitch selling point for the few seconds you have the user’s attention. It’ll be especially exciting for people who like the idea of cryptocurrency but don’t have the desire or means to get involved. And if kids get on board, it has a bit of that aspirational maturity/brag feature of going to school and telling the other kids they own crypto.

These short ads for Nest Arcade practically write themselves, and I expect the clickthrough rates/ROI on them to be among the best in their demographic. The user path is a simple ad => click => download funnel, one that is far superior to the current crypto-community-centric onboarding needed for NFT games.

Younger Audience

Again, more than anyone it’s the younger demographic that is very familiar with the in-game economies of mobile games. For them, asking a parent for some Apple store money to buy in-game upgrades is completely normal.

The P2E model turns that model into the opposite direction. Have you seen a kid play Subway Surfer? Depending on their disposition and age, they can go at it for hours. Now replace the coins they earn to buy skins with $NEST tokens that can be exchanged for real USD. Adults may not want to play for hours with those kinds of stakes, but many kids will.

Project Concerns:

Earn to Play

My biggest worry with Nest Arcade is that a Flappy Bird style engine is the kind of game that can lose its appeal very quickly. It’s entirely possible they’re able to add more into this first title to retain enjoyable play value. As a holder I’m actually glad the beta was held back by a week or two, as that speaks well to the attention being paid to the quality of the games they release.

I hope they’re able to add in a lot of bells and whistles to make it more of a fun experience. And like I said here, regular dopamine hits can make up for game design flaws — I can absolutely see replay value added with a regular mix of loot boxes for $NEST tokens and a few legendary rarity level big prizes.

When I reached out to the team with questions, they told me there’s currently a team of thirteen developers on the project, which speaks well to future releases. I’d really like to see them put out one or two releases soon after this first game to show the varying offerings of the brand and cast a wide net.

Another part of their plan that can alleviate this concern is Nest Hub: an offering to outside game designers to launch their releases on Nest Arcade and take advantage of their ready-to-go platform.

Addictive mobile games aren’t rocket science, the templates are out there. Everyone has their favorite styles. You may love Flappy Birds and you’re super psyched about the first release! But Nest Arcade will need other styles like Candy Crush puzzles, simple sports related aiming games, Subway Surfers and so on. I’m sure it will happen, it’s just a matter of getting them out soon enough while not sacrificing quality.

Smoking

I went over this with detail in my Panzerdogs review, so I won’t be redundant here. But hey, at least this one can pass off as a cigar and not a straight up joint.

I reached to the team to get a comment and was told they’ll be looking into it. If the demographics data comes in and leans towards a younger audience, then it lends itself to a discussion on how to move forward with a possible change.

Onboarding

Nest Arcade will have full Solana wallet integration out the gate and I’m interested to see how this is fully developed from a UI perspective/how they’re able to design it in a way that’s easy and intuitive for players unfamiliar with NFTs or crypto.

This could be a major make-or-break element of the project. Their Ad => Click => Install acquisition funnel should spark jealousy in the current NFT gaming niche. But the next step of a “normie” setting up a crypto wallet in a way that’s not intimidating is going to be the tricky part. Hopefully the new Phantom wallet app can help with this hurdle.

Tokenomics Inflation/Adjustments

The whitepaper briefly touches on how the $NEST token reward release emissions could be adjusted based on supply and demand. There isn’t necessarily a problem with this, but if the $NEST/$SOL/$USD value is going to be adjusted, it’s something that needs to be fully transparent to players. From my professional experience, this kind of change will universally spark a negative reaction in the player base, so advance notice is needed to warn players and do damage control.

The best way to approach this issue might be to adopt a system similar to a DeFi Automated Market Maker. This would put the token value adjustments into an algorithm, which would be an easier pill for players to swallow than “The game company decided to decrease the value of your tokens”.

Conclusion

The past few weeks have seen a massive influx of new projects coming out the pipeline with ambitious roadmaps. Nest Arcade is a refreshing change of pace from that trend. They know their lane and they are going to be first movers in a market that has lots of appeal far beyond our current niche-oriented crypto gaming community. The sky is the limit for acquisition: their marketing can be targeted directly to the right audience and provide a quick five second “Earn crypto for playing!” sales pitch that stands out from the competition in mobile gaming.

They’re setting achievable goals with solid financial investors behind them and a full team to make it happen with speed and quality. There’s a beta ready to release any day (possibly by the time you’re reading this!) that will allow holders to start earning their native $NEST token. A limited number of 1,600 NFTs for this first game and players only getting 10% earnings without one could mean exceptionally high demand on the secondary market. And that’s without all the additional NFT utility such as staking, renting, breeding, token airdrops and so on.

Their challenge will be to build out a solid library of games that will offer something to all players. As a holder, my urgency to see that is much lower than my expectations for a different business model. A typical NFT gaming project on Solana really needs to hit all their milestones to keep up. But Nest Arcade is playing in a much larger sandbox.

Because their appeal can be far beyond our small ecosystem, they’re able to benefit from ignoring the market movements in the core Solana niche while building up that library, and then starting a mainstream marketing campaign.

I’ll keep this in mind as a holder: if we’re just looking at Flappy Bird for too long then yes, they’re not keeping pace with the other games in the Solana space. But that’s not their competition, because they have a much wider net to cast in a far bigger ocean. As long as I’m seeing development of newer titles moving forward in their Discord, I’m happy to be more patient with taking my profits in the project.

Links for Nest Arcade/MetaBirds

Website: https://nestarcade.io/
Discord: discord.gg/nestarcade
Twitter: https://twitter.com/TheNestArcade
Whitepaper: https://docs.nestarcade.io/
Magic Eden: https://magiceden.io/marketplace/metabirds

Please note I am not a financial advisor and none of the content on this website should be considered financial advice. All content shown here is based on my personal opinion. NFTs are a very risky investment where many projects go down to zero value. Please do your own research and only invest what you can afford to lose