The new entertainment industry associated with blockchain.
In recent times, the gaming industry has grown substantially mainly since the introduction of Web 3.0, reaching USD 152 billion, reflecting not only the opportunities for developers in this space to earn substantial profits, but also increased consumer adoption.
Until now, games were based on a one-sided relationship, meaning that only the developers or owners of a game reaped the financial benefits, while players were meant to spend and have fun. In 2020, customers in the mobile app sector spent approximately USD 145 billion and the developer sector approximately USD 100 billion. So for every dollar spent on apps like the Google Play Store and the App Store, apps managed to pull in 69% of the total revenue generated.
The trend in both games and app development is upwards and a sustained 20% AAGR (Average Annual Growth Rate) is expected over the next 5 years, With blockchain, a new business model has been introduced, the play-to-earn gaming model, which, associated with virtual worlds, will determine a very promising long-term trend in the sector, even more so than with the patterns derived from COVID-19.
what is the “metaverse”?
Metaverse means beyond the physical universe, a place in a dimension of space and time different from the one we know, where you can reinvent yourself, where you can buy and sell virtual properties, avatars, things, take part in competitions, have new friendships, etc., in short, be yourself and behave differently beyond our own existence as human beings and be able to have everything we dream of that our existence as people limits us to.
The Metaverse is a beyond our self, which allows us to have a different identity, to have the friends we want, to attend events and to buy goods and services immediately, as if it were the real world, but in digital format.
This whole ecosystem of humanoid relationships is based on payment through native cryptocurrencies that are used both for transactions within the Marketplace where these interactions take place and to receive assets, buy special supplementary functionalities or features for them and to receive in-game rewards.
what are “play-to-earn games”?
Play-to-earn games are based on a financial reward in cryptocurrencies for each user who contributes value when playing, as well as to reward the loyalty of dedicating part of the player’s time to the ecosystem. It complements the system not only for fun but also offers the possibility of an economic return with their participation.
The traction of play-to earn games has been due to their economic model. Thus, Axie Infinity (Pokémon-inspired blockchain game) and The Sandbox have gained popularity for their relational economic system and in-game liquidity, which has been solved through the use of blockchain technology.
how do play-to-earn
games work? In these games users can breed, buy, train, engage in tasks and participate in battles with the creatures that serve as the basis of the game, even place bets, participate in referral earnings, etc.
The main objective is to obtain an in-game token with which players can perform all of the above functionalities, which in turn allows them to have a competitive advantage that enables them to earn more money. These in-game tokens are spent continuously in-game and can be worth up to 300 USD. In addition to the game’s own unique assets, the created creatures themselves (complex assets) with these kinds of new abilities and functionalities can be sold as NFT (Non-fungible tokens) on an open market and thus monetised.
But the time spent playing the game is also rewarded with tokens that can be exchanged in a decentralised way for cryptocurrencies in a fully open peer-to-peer market. A whole new world of value creation.
what are decentralised metaverses?
These are those play-to-earn games that provide an experience beyond the physical world in which open source is the metaverse. We have multiple examples such as Blocktopia (virtual reality experiences), OneTo11 (fantasy sports), etc.
There are a multitude of platforms such as Nakamoto Games that allow any player with cryptocurrencies to access a wide variety of games on the platform and at the same time compete to win prizes on a weekly basis and monetise the results of the rewards obtained.
Other well-known platforms include Immortal Games, American Gothic, Fantasy Defense, TryHards, etc. These platforms not only allow players to earn but also developers, either through their contribution as creators or in their maintenance functions, which facilitates a new business vertical within the cooperative gaming marketplace. Investment funds have already seen this business opportunity and are already launching financial structures to take advantage of the trend and the sector, but the regulatory complexity that accompanies its development dampens the ambitions of many entrepreneurs who want to compete in this fierce market.
Many adjacent regulations converge in this type of interaction and must be taken into account in order not to lose the opportunity to obtain a return on the activity with all the guarantees.
At AddVANTE we can help you build the regulatory and risk framework you need to achieve legal certainty in your business developments and avoid the greater evils of mistaken planning due to failure to take risk factors into account. This will give you the financial traction you have planned and you will have a dynamic community that will be legally secure and comfortable in your metaverse.