Play to earn economies as base layer protocols for games

We believe P2E games should be careful about designing incentive structures that are based on gameplay alone. By doing so, they expose themselves to the risk of skewing their membership towards mercenaries, who are more likely to jump from game to game in search for higher returns (similar to how yield farmers jump from farm to farm in DeFi protoco... See more

For economies to be sustainable, the sinks need to take more of the token supply out of the economy than the faucets that bring the token into the system, otherwise, there will be natural downward price pressure as supply increases over time.

(eg. SLP earned by completing quests or battles)

While the legacy metrics place an emphasis on “how many players does your game have”, we believe P2E ecosystems need to focus on “who are the players and contributors”. As such we highly encourage P2E ecosystems to carefully curate it’s early community members and players. This can be done via manual whitelisting and other measures such as gated pa... See more

Player retention in gaming is everything. Despite this, publishers optimize for company profit at the cost of player value and well-being. They are able to do this due to their end-to-end ownership and control over the development, distribution, and management of games.

While we don’t expect all P2E ecosystems to be decentralized from the start, anticipating a more gradual process of decentralization as seen with Axie Infinity, we believe this Web 2.5 trend of game development stems from a fundamentally incomplete understanding of composability, interoperability, and the power of decentralized coordination technol... See more

-Faucets inject asset supply into an economy

In contrast to the current global 30-day retention rate of 3% of mobile games, we have seen some initial success with the first prominent P2E ecosystem: Axie Infinity — which has a D0-D90retention rate of 40%.

These economies are not only just places where community members play, but also worlds in which they have financial upside, ownership over revenue generating businesses & valuable digital assets, and defined jobs & responsibilities.

-Monetization: eg. value accrual mechanisms, transaction fees