How People in Impoverished Nations Earn Cryptocurrency in the Metaverse
When the COVID-19 pandemic hit, the economy of the Philippines went into a tailspin, with people unable to go to work due to lockdowns. Unexpectedly, many have turned to the Metaverse as a way to make money from home.
The Metaverse: a persistent, live digital universe that affords individuals a sense of agency, social presence, and shared spatial awareness, along with the ability to participate in an extensive virtual economy with profound societal impact.
-Piers Kicks
The Play-to-Earn model has been touted as a new way of making money in the digital realm. Because people who play games that are a part of the Metaverse are rewarded with digital goods on the blockchain such as fungible tokens, non-fungible tokens (NFTs), and cryptocurrency, players who spend time in the digital world are rewarded with real world value. This is the system behind Axie Infinity, a popular game in the Philippines.
Axie Infinity is a blockchain-based trading and battling game that allows players to collect, breed, raise, battle and trade token-based creatures known as “axies,” which are digitized as their own NFTs.
-Omkar Godbole
Here’s how it works: When players of Axie Infinity win a battle, they are rewarded with an in-game item called a Smooth Love Potion (SLP). Smooth Love Potions are required to breed Axies in-game, making them sought after items, as you can create better Axies by breeding two with good qualities.
Behind the scenes, Smooth Love Potions are ERC-20 tokens that are secured on the Ethereum blockchain, meaning that players can sell them for ETH, which can be traded for real world fiat currency. This is exactly what people in the Philippines started to do during the COVID-19 pandemic.
In a documentary by Emfarsis, it is noted that players in the Philippines are able to earn $300-$400 dollars in their first few weeks of playing Axie Infinity, which is more than many earn in a month, with many people playing from low-cost internet cafes. However, when checking the Axie marketplace, currently, the cheapest Axie for sale is $174, with the average price seemingly around $300.
This is a problem for many new players in the Philippines, especially considering that you need 3 Axies to start playing, making the entry price a minimum of ~$900. That is where the manila-based company Yield Guild Games comes in.
The mission of Yield Guild Games (YGG) is simple: we want to onboard millions of players from around the world into the “play-to-earn” revolution.
Yield Guild Games has found an interesting way to leverage the Play-to-Earn economy by creating a business model based on leasing Axies. Yield Guild leases Axies to users who may not be able to afford one, allowing them to play the game at no cost, and sets up a revenue share for all money earned in-game with their Axies. This model allowed YGG to generate over $160K in just 4 days.
The Philippines is not the only country that is being helped by the ability to make money through playing video games. In Venezuela, for example, people can earn 10x the earnings of an average doctor simply by farming gold in Runescape. However, in most games that are not a part of the Metaverse, like Runescape, selling your in-game items is against the Terms of Service and can result in a ban. Now, with the Metaverse, people have true ownership of their in-game items as tokens on the blockchain and can do what they want with them — including selling them to help put food on the table.
The digital goods market is a $50 billion dollar industry, and we will only see the Play-to-Earn model become more popular as the Metaverse expands.
