Billions of GameFi and blockchain gaming markets are named as one of the main trends of 2022, which promises many opportunities for both gamers and investors. But until now, the market is so fragmented and chaotic that it is difficult to understand how to profit from this trend. To be successful in this rapidly growing field, the secrets of the GameFi industry must be known.
How is GameFi different from online games?
GameFi is a new breakthrough in the blockchain industry at the nexus of two domains – decentralized finance and decentralized gaming. GameFi is not a simple online game. GameFi are gaming platforms that allow their users to profit from the game with digital coins. On the one hand, it increases the retention rates of its users, on the other hand, it helps users to earn real money within a game.
To start playing and winning games, a user must purchase a game asset with a character or a hard-to-trade character – available in NFT format. Largely thanks to GameFi, the NFT market has reached unprecedented growth rates in 2021. According to DappRadar statistics, trading volumes of immutable tokens have increased hundreds offold – from $100 million in 2020 to $23 billion in 2021. This Lion’s share Some of these trades took place for gaming NFT. In November 2021, gaming NFT’s trading volumes exceeded $1 billion, nearly doubling their growth rate in a month compared to October 2021.
This economic model for decentralized online games was called the Play-Win model. This situation actually occurred to enter the NFT game. By purchasing NFT, users get the opportunity to access a multiplayer online game, interact with other players and most importantly profit from participating in the game
Where does liquidity come from in GameFi?
When a user purchases a subscription to the game, for example, for the football simulator FIFA, it is enough to pay once. After the purchase, the user can play at any time. The basic principles are different in GameFi gaming, which requires purchasing game NFTs.
In decentralized online games, users need to purchase game items and characters. For example, if the once popular casual game FarmVille was an NFT-based game, a player wouldn’t be able to get a piece of land and seeds for free. In this game, users had to purchase crops to harvest them.
There’s also good news: On GameFi, users also have the opportunity to monetize game items. If one is good at harvesting crops, they can sell them and get a return on investment in soil and seeds.
Since NFT games emerged and grew in the fertile soil of the cryptocurrency market, all transactions involving game items in the form of non-tradable tokens are executed in cryptocurrencies. In this way, the gaming ecosystem is filled with liquidity that allows the use of the Play-to-Earn model.
Up to $400 per Month for Few Hours of Online Gaming
Profits on GameFi projects come from several sources;
- Gaming NFT is worth a few dollars, skyrocketing to hundreds and tens of thousands of dollars as sales begin and new players enter.
- Rewards for performing game missions: for example, winning other players in battles for completing missions.
- Rewards of game items and characters, investments in a GameFi project’s native token that serves as currency for purchases and sales.
It is clear from the description that the first two income sources are for the players, and the third income source is for the investors who see GameFi projects as one of the passive income sources and do not actively participate in the game itself.
However, in the real scenario, the first source of profit playing NFT in leading games can only be accessed by investors or high-income players, as its value can reach hundreds and tens of thousands of dollars. So at the end of 2021, the average price of the NFT character of the popular decentralized game Axie Infinity reached $ 140. According to forecasts, it will rise to $219 in 2022. However, to start a game, a player needs three characters. That way, the initial investment to start a game is $420. Of course, it significantly exceeds the subscription price levels for centralized multiplayer online games.
Not every online player can reserve such fees to access the game. Statistical data shows that most GameFi games are from the poorest countries, where earning from Play-to-Earn games can bring a significant boost to the average salary. Of course, for them, the high initial investment is a serious obstacle. As a result, NFT characters fall into the hands of investors who want to earn money but do not have time to complete their daily game tasks, as they are not active users of the platform. Investors also do not use the GameFi market to its potential, as they do not earn money from the game, do not receive rewards by completing daily tasks.
To solve this problem, a market needs additional services. One of such infrastructure projects created for the development of blockchain applications is MetaRent, the p2p platform of Meta DAO Guild.
What is Meta DAO Guild?
is a decentralized autonomous organization that handles various infrastructure projects in the P2E gaming industry and offers an elegant solution to two main GameFi problems:
Investors’ problem: They have money and want to profit from it but have no time to devote to gaming none.
· Players problem: They have free time but no money to buy an expensive NFT character to access a game.
The solution to both problems lies here. If users do not have time to play a game or want to spend free time in another game, they can rent their NFT. On the other hand, users who do not have the money to buy NFT can rent and access other people’s characters.
This is exactly a kind of p2p platform for renting game NFT created by Meta DAO Guild called MetaRent. Profits from games are distributed between the player and the owner of the game token. This solves the idle game NFTs issue.
At the same time, the platform offers tools that guarantee the security of the deal for both parties.
How does the platform work?
NFT owner registers on the platform and selects players from scholars (Meta DAO Guild-trained players). When leasing NFT, the owner shares half of the profits with a player. Tenant (player) gets access to game NFT without initial investment.
MetaRent platform from Meta DAO Guild enables NFT owner to share profits with tenant through smart contracts. To avoid the possibility of fraud, Meta DAO Guild takes a mandatory deposit from an NFT owner. In other words, the investor has to make a deposit to lease the NFT. A deposit is a guarantee that a player will be paid.
Of course, NFT holders run the risk of dealing with an inexperienced player who can waste time and earn no return. That’s why Meta DAO Guild is creating a training system and ranking mechanism for players. Investors have the right to choose the best free players to rent their NFTs.
The full list of services offered by Meta DAO Guild includes:
- MetaRent: p2p platform for renting game NFT;
- Scholarship: A training system for players – members of the DAO Guild renting out game assets belonging to the guild (community) and external owners;
- MetaExchange: exchange service for game NFTs that allows the exchange of unclaimed game items or characters (hard to sell) within a game or between games;
- DAO Launchpad: Decentralized venture fund for investments in GameFi projects.
The latter – DAO Launchpad – deserves special attention. As the name suggests, the fund is managed as a decentralized autonomous organization, that is, by the users themselves. Users must have native platform tokens MDGG to get voting rights to select GameFi projects for investment.
Participation in DAO Launchpad provides many benefits to a regular user. Above all, it offers retail investors opportunities to invest in promising GameFi projects in the early stages where access is not yet available. While the best conditions are offered to investors at this stage, the profitability of purchased tokens or produced NFTs can reach 1000% in a few years.
For example, in summer 2020, Axie Infinity sold 10 800 000 AXS tokens for $860,000 during its closed investment round. As such, an AXS costs 8 cents for early investors. While AXS is now trading at $52, it skyrocketed to $102 in the Fall. Return on investment for tokens sold in October 2021 was 1200х, January 2022 – 650х.
DAO Launchpad provides an opportunity not only to receive investment in game projects, but also to access the Meta DAO Guild’s relevant gaming community.
Investors interested in the projects that make up the GameFi industry infrastructure have the opportunity to purchase Meta DAO Guild tokens MDGG during the launch starting February 22.
Why will GameFi grow?
It’s best to use real-life examples to understand GameFi perspectives. Last year, the Philippine CNN office shared that citizens of the Philippine Province of Nueva Ecija earn by playing NFT games. Thanks to a decentralized online game that gives the opportunity to earn income, citizens can pay for food, medicine, bills and even close their loans, even if the pandemic takes their jobs.
Like DeFi in 2021, GameFi has every chance of becoming the main trend of 2022. It is rapidly growing and inflating with liquidity from both users and institutional level investors. In the second half of 2021, billions of funds have been created to invest in GameFi projects in the early stages. For example, Gala Games, together with C2 Ventures, launched a $100 million venture fund for GameFi, while Solana Ventures, Forte and Griffin Gaming Partners created a $150 million fund. The valuation of Animoca Brands, the Hong Kong company working with blockchain games and NFT, has skyrocketed to $5 billion in its latest round of investment.
Hundreds of new decentralized games are expected to launch in the GameFi market in 2022. But the most important thing is that this year major game companies-developers enter the Game F niche. It is reasonable to expect improvements in user experience due to more detailed game scenarios, in-depth sound character design and visual component enhancements.
But the main growth factor is the entry of millions of users into GameFi. Thanks to the new economic model, Play-to-Earn players have the opportunity to win while playing. That’s why projects in this industry are ready to show multiple profits despite the volatility of cryptocurrencies.
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