Find out why so many people are diving head first into play-to-earn games.
This article will cover the basics of play-to-earn (P2E) games, including what they are, how they are built, and how they can potentially benefit you.
What are Play-to-Earn Games?
While there can be more niche forms of P2E games, when someone mentions play-to-earn gaming these days, they will typically mean blockchain/crypto games that utilize this model. If you’re already familiar with bitcoin or other popular cryptocurrencies, the concept of blockchain won’t be too foreign. In that case, you’re likely already somewhat familiar with the basics of a blockchain (if this is a new topic for you, check out this article on blockchain for beginners).
Play-to-earn (P2E) games converge into the blockchain ecosystem when they leverage the blockchain somehow or, at the very least, a form of cryptocurrency. Often this addition is via enabling ownership of digital assets that represent specific in-game items, characters, or other game-related valuables such as in-game currency.
When items from games are tokenized and stored on a blockchain, they can be traded, exchanged, and moved between wallets with relative ease. This combination of gaming and digital assets adds another layer to a more traditional video game by providing collectible items that can be traded and even worth real money if a community forms around the game.
How do Play-to-Earn Games Work?
P2E games are a lot like regular games. They can be found across various devices and may feel similar to other games. However, they tend to handle things like items, achievements, etc. Depending on the game, what is possible varies, but in general, play-to-earn games work by encouraging a market to develop around these tokens or NFTs.
As you play the games and earn, unlock, or otherwise acquire transferable assets in the game, you can then on-sell these to other players who place value on them, just like you can with a more traditional crypto asset, like Bitcoin. While it may be tempting to conclude that in-game items really can’t be that valuable, this isn’t a new concept and has existed for many years with thriving secondary markets for things like Runescape or World of Warcraft gold. The big difference now is that often this trading isn’t just encouraged; it’s built into the framework of the games themselves and not just a market that develops due to demand.
To put it simply, playing P2E games enables you to gather digital assets that have value. Then you can exchange them for other forms of cryptocurrency and even cash out their value into your local currency, provided a game is moderately popular.
What is the Play-to-Earn Business Model?
There are many ways that play-to-earn games can make money using crypto. While the approaches used can vary from game to game, there are a few common ways that you may come across when investigating games where crypto is involved.
Native Cryptocurrencies: Many games have in-game currency, and many offer unlockables that can be paid for; due to how effective this can be in producing revenue for the developers, many P2E games are also taking this route. However, they may do so differently from merely storing a variable in your save file or somewhere in the cloud. By creating cryptocurrencies native to the game or utilizing established cryptos like Bitcoin or Ethereum, they can take these forms of in-game money beyond the typical bounds of a game.
NFTs: It’s common for many crypto-focused games to involve NFTs in some way. Often selling NFTs is one of the ways these projects get funding in the first place. You may see projects using the concept of an NFT as a way to tokenize in-game items, avatars, vehicles, cards, and just about anything you’ve seen in a video game before has the potential to be an NFT, whether or not that adds to the playability of the game, that’s another story.
Advertising: Crypto games can often be sponsored by advertising like any free-to-play game on your phone or computer. Advertising enables you to play free games while still allowing the developers to make profits from their hard work. The free-to-play model overlaps with blockchain and NFT games, at least partly due to its massive success in the traditional gaming market. Games relying heavily on advertising will often focus heavily on keeping you playing as long as possible, which can be good or bad depending on how you perceive it.
Marketplaces: As in-game items become tradable, it’s natural for many games to explore offering marketplaces to users. The marketplace then enables the team to take a cut on trades in the form of a fee if desired or even sell assets into the market they generate themselves. Another way to generate revenue without operating their own marketplace is to hardcode a fee into the smart contract governing digital assets used in these games to pass on a fee to the developer whenever they are exchanged or perhaps even transferred; this enables their players to use large NFT marketplaces like Opensea while still getting a cut of the trading activity.
Team Allocations: When cryptocurrency projects are launched, it’s very typical that at least some tokens, NFTs, or other benefits are kept to the side for the team or other invested third parties. Doing this enables the team to make a profit later selling these assets, which in ideal circumstances also incentivizes them to make a great game due to their exposure to the price of these assets.
Are Play-to-Earn Games Free-to-Play?
While most blockchain P2E games are free to play, what isn’t always free is getting ahold of items sometimes required to play the game. Even though some games will lean more into the free-to-play model by enabling you to start playing with some basic items and earn, buy, or trade for more to progress or change the game’s experience, some games will require you to have a specific type of NFT or other digital assets just to get started playing.
In short, it depends on what is required, if anything, to start playing the game, and this does tend to vary quite a bit.
How to Get Started in Play-to-Earn Gaming?
The first thing to consider is your budget. If you want to start without spending anything, this will reduce your options somewhat. Beyond that, you can start asking yourself more general questions like what types of games you are interested in, perhaps NFT card games, maybe a P2E racing game; it’s really up to you and what’s available (which is a list that’s growing quite often).
Once you decide on a game (or even a few) you’d like to check out, one of the next things you may find helpful is to look for some guides and reviews or, ideally, video reviews about the game.
A little due diligence before you start playing a game can give you a better idea of what to expect, which is especially important before dropping some funds on crypto-assets to try it for yourself. Several games have dropped excellent trailers before launch, but it was much less compelling once the game appeared, which is one thing to waste your time, but if you’re buying NFTs or crypto to play, that’s a real investment. However, there’s a lot of information to dig through for even moderately popular games. Just beware of sponsored content, and don’t forget to check out places like Reddit to see what the players appear to be saying along with their general sentiment towards the game.
How to Set up a Wallet for Play-to-Earn Games?
Different P2E games can use various blockchains. While it’s not very common to see a P2E crypto game using their only fully custom blockchain, you still need to know which network is being used to be able to use an external wallet to manage your tokens or other transferable digital assets that you are using with a particular game.
For example, a game that issues tokens on the Ethereum network would likely work well with a wallet like MetaMask, MyCrypto, or MyEtherWallet. In contrast, a game that issues tokens on Solana may require you to use a wallet like Phantom Wallet or Solflare Wallet when you want to manage your tokens outside of the game or NFT marketplace.
What Games Can I Play to Earn Money?
There’s a list of P2E and blockchain games that are growing in number by the day, but if you’re looking for somewhere to start, here are some popular examples of games you can earn money playing. There's something for everyone between crypto card games and projects exploring the metaverse concept; there’s a lot to explore.
Are Blockchain Games Worth Playing?
With the popularity of both blockchain games and the P2E gaming model growing in popularity, a mix of experimental, impressive, and misfires is filling the space. However, thanks to this growing interest, new games are being released regularly, and thanks to all this competition, there’s something for everyone to explore.
If you’re interested in gaming, why not explore this new concept and see what the fuss is about? You may just earn some crypto in the process!