P2E—short for Play to Earn Games—is one of the most popular terms in the crypto space. These NFT games that belong to the broad category of blockchain games made their triumphant entry, pushing aside traditional mobile phone games. To put things in perspective, the evolution of P2E games resulted from the seamless integration of NFTs, games, and finance.
Simplifying the concept further, the crypto dictionary defines P2E games as a type of gaming in which a gaming platform allows players to earn in-game assets that can be transferred to the real world as valuable resources. In short, it allows players to farm or collect cryptos and NFTs, which can be sold on the crypto market.
Not a pastime anymore
From the very ordinary arcade machines in designated gaming arenas to everyone having a gaming console in their room, gaming has come a long way. Likewise, we have leapfrogged from playing the snake game on those unbreakable Nokia phones in the early 2000s to navigating the mind-blowing sci-fi games of today. Thank technology for reshaping the industry beyond recognition in the last 20 years or so.
Analysts say the gaming industry is expected to grow at a fast pace in the future. The global gaming industry is estimated to be worth $268 billion by 2025. Interestingly, the long-standing cultural association of gaming as a wasteful, unproductive activity will no longer hold water for millennials and their succeeding generations as NFT games have brought in the lucrative angle.
How it all started
For those who like their history, the birth of play-to-earn gaming coincided with Bitcoin surging in value from $13 to $1100. Huntercoin, created by the Xaya team, was the first blockchain game. It allowed players to collect coins on a global map, and users could use this map to find resources, engage in player vs. player combat, and dominate the map. While the game was initially launched as an experiment in February 2014, its success demonstrated to the world that blockchain and gaming could intersect productively, and thus, P2E was born.
What began with mirroring the principles of Bitcoin evolved into a blockchain principle that could run various game worlds. P2E games cover all genres, from simple puzzle games to arcade games, fantasy sports, and much more.
How P2E is redefining gaming
Gaming has been a part of our lives for long, be it simple smartphone games or P2E games. To understand how P2E gaming is redefining gaming, we need to figure out the similarities and differences between traditional gaming and P2E gaming. Simply put, traditional gaming is pay-to-game, while P2E is play to gain.
Now, let us try to understand how P2E is redefining gaming.
Gaming hours as productive investments
“Time is money” is an aphorism we have all heard of, and in crypto, time is money. And the first Bitcoiners would vouch for that. Gamers around the world spend so much time and energy on games. A peek into the live streaming service Twitch or YouTube will give you an idea about how many human hours are spent in gaming. With P2E gaming, these hours can be turned into productive investments. Of course, there are traditional games that get incentivized through these platforms, but they require building an audience first, which can take time. With P2E, anyone with a decent laptop and internet connection can enter the gaming arena.
Gaming for economic empowerment
The socio-economic factor is crucial as P2E redefines gaming. For instance, a gamer playing Xbox or PS5 and streaming the game on Twitch is completely different from a Filipino playing Axie to put food on the table. Small wonder people in low-income countries like India and The Philippines prefer P2E to traditional gaming. The onset of the global pandemic left millions jobless with no source of income. In March 2020, more than 29,000 individuals downloaded Axie Infinity in the Philippines, while the number of users worldwide stood at about 70,000, according to Axie. So, it is not just gaming that is driving the popularity of P2E games.
Ownership of in-game assets
In traditional games, the player may lose access to their collectible items in the event of a server crash or technical snag. However, in P2E gaming, players can have digital ownership or swap rare goods in exchange for profit in a blockchain-supported gaming environment. P2E games have a magic spell called “smart contracts” to handle all transactional details. So all in-game assets purchased using smart contracts are immediately transferred to your public address accounts. Also, as P2E is decentralized, there is no centralized authority that can tamper with the public IP address or change the private ownership of those assets.
From pastime to profession
Gaming was once just a hobby, but it has taken a lucrative turn with P2E. Truth be told, P2E games have fueled the rise of a new world of digital economies where users can create, sell, or trade in-platform assets for money. The billion-dollar industry speaks for itself. Video game fans will be wondering if they can earn enough money from P2E to pay their rent, and bills, and meet necessities or even quit their day job. The prospect may sound a bit ambitious, but not impossible, depending on where they live and how much money they require for a decent living.
P2E is here to stay; India has a huge market potential
Gamers and crypto enthusiasts alike are super stoked about P2E. Notably, India has the potential to emerge as a huge market for the blockchain gaming industry as the country boasts about 50 million gamers. Yet, some traditional gamers are not enthused about the P2E genre and have reservations about this futuristic technology. But P2E is here to stay and it would be interesting to see how the fusion of blockchain technology and gaming technology would alter the gaming landscape shortly.
FAQs
How can P2E shape the future of the gaming industry?
Play-to-earn (P2E) games have the potential to significantly shape the future of the gaming industry by introducing new economic models and player incentives. Here’s how P2E can influence the gaming landscape:
1. Economic Empowerment: P2E games allow players to earn real-world value through in-game activities, creating a virtual economy with tangible rewards. This economic empowerment provides players with a sense of ownership and financial incentives.
2. Disruption of Traditional Models: P2E disrupts traditional gaming models by enabling players to monetize their time and effort. This shift challenges the traditional buy-to-play or free-to-play models, offering a more inclusive approach where players can earn rewards for their contributions.
3. Virtual Economies: P2E introduces complex virtual economies within games, allowing players to trade, buy, and sell in-game assets. This economic activity mirrors real-world market dynamics, creating a novel gaming experience and additional revenue streams for players.
How does P2E work with blockchain?
Play-to-earn (P2E) games leverage blockchain technology in several ways to enhance gameplay and enable new economic models:
Asset Ownership and Security: Blockchain integration allows players to truly own in-game assets as non-fungible tokens (NFTs) on a blockchain. This ensures secure and verifiable ownership of digital items.
Smart Contracts: P2E games use smart contracts on blockchain networks to automate various in-game processes. Smart contracts enable trustless and transparent execution of actions, such as distributing rewards based on predefined conditions.
Decentralized Economies: Blockchain facilitates the creation of decentralized in-game economies where players can buy, sell, and trade digital assets with real-world value. This introduces a player-driven marketplace for virtual goods.
What is the future of blockchain gaming?
The future of blockchain gaming looks promising with significant advancements and growth predicted in the industry. Key trends and insights include:
1. Increased Adoption: Blockchain gaming platforms have gained widespread adoption, transforming the gaming industry by introducing decentralized and player-centric ecosystems.
2. Growing User Activity: Q3 2023 witnessed substantial growth in blockchain gaming activity, with an average of 786,766 daily unique active wallets, reflecting a 12% increase from the previous quarter.
3. Market Valuation: The market size for blockchain gaming is valued at over $3 billion in 2023. It is projected to experience substantial growth, reaching between $65 to $90 billion by 2030.
What is the gaming blockchain industry?
The gaming blockchain industry refers to the integration of blockchain technology into the gaming sector, transforming traditional gaming ecosystems. Key aspects include:
1. Decentralized Ecosystem: Blockchain technology introduces decentralized and transparent gaming ecosystems, allowing players to have true ownership of in-game assets.
2. Web3 Gaming: The industry is evolving toward Web3 gaming, marked by decentralized applications (dApps) and blockchain-based platforms that offer unique gaming experiences.
3. Market Overview: As of 2023, the gaming blockchain industry has shown substantial growth, with a global market size reaching $8.9 billion, and a positive outlook for future expansion.
