All You Need to Know about P2E Games

Abstract

P2E games have become a kind of significant economic gameplay of GameFi applications. Moreover, it has aroused the great interest of a large number of crypto users.

P2E, short for Play to Earn, refers to the mode in which players earn rewards via interaction. Games of this type are divided into two forms: early investment and early experience.

Players of some games are required to make an initial investment in Token or NFT to gain profits in the future. In contrast, some games allow players to experience the game free of charge and then require them to invest to earn cryptocurrency.

The Origin of P2E Games

P2E games are defined based on the blockchain framework. It is designed to provide users with application scenarios in the form of games. Participants can get rewards and exchange for profits in cryptocurrencies by participating in PVP or PVE. Axie Infinity, StepN, and DeFi Kingdoms are all famous P2E games.

Presently, the P2E model is applicable to almost all different types of games. After all, the complete behavioral logic of input-participation-feedback underpins all games. As a result, the P2E mode has become the main gameplay of the vast majority of GameFi applications in recent years.

Whereas, if we trace back to the source, we will find that the development of P2E games till today has been accompanied by the explosion of NFTs. Similar to GameFi and SocialFi, which are the mainstream directions of various NFTs today, the P2E model has become the major gameplay of GameFi-oriented applications. The P2E game is one of the mainstream NFT applications generated by the crypto market.

Basic Elements of P2E Games

P2E games include the following elements:

• NFT: Most P2E games contain NFT and derived NFTFi gameplay. ERC-720 and ERC-721 are common types that users are familiar with. NFTs are often used as a participation certificate in the P2E ecology, and many game characters or props are in the form of NFTs.
• Token: P2E games use two or more different tokens, mainly governance tokens and game tokens, to form an overall economic cycle system. Governance tokens are used to govern the ecology, while game tokens play the role of in-game props consumed by players.
• Gameplay: There are two major types of gameplay including PVP and PVE, which are also the basic features of P2E games. Essentially, the multiple types of gameplay can be regarded as alternative DeFi gameplay such as staking to mine and snatch settlement.
• P2E: This basic feature allows players to enter the market by making an initial investment and quickly gain the principal by playing games. If they keep participating in games, they will be able to gain profits. P2E is a linear investment approach that will help gain returns.
• Trading market: It is necessary for P2E games to ensure the efficient circulation of internal and external crypto assets of the game. Therefore, the trading market based on the game ecology will provide players with a variety of NFTs and item sales services, and players can also place orders.

The greatest advantage of P2E games lies in their potential for the creation, ownership, and exchange of digital assets, and the potential created when these markets are connected to traditional economies and fiat currencies - allowing players to translate their time, energy, and income into disposable income in the real world.

Examples of P2E Games

（Source: axieinfinity.com）

Axie Infinity

It is believed that different users in the crypto market are familiar with Axie Infinity. In the course of nearly two years of development, Axie Infinity has launched applications that focus on P2E games as well as NFT trading platforms.

Axie Infinity is a decentralized turn-based strategy game. Since its development, it has repeatedly ranked among the top in the Ethereum ecosystem in terms of transaction volume and number of users.

Based on Ethereum, Axie Infinity is designed for players to control the NFT elf Axie to fight and breed. Most of the game’s process doesn’t need interaction with the blockchain, which ensures the most important playability for the game.

At present, Axie Infinity’s system covers multiple sections, mainly including the combat system, breeding system, trading market, and land system.

Axie Infinity presents the following features:

• A simulation/battle game similar to the Pokémon series that allows players to accumulate, trade, and upgrade.
• Developed based on the ETH blockchain, Axie Infinity gained great popularity in 2021.
• With a current market valuation of over $1 billion, it is one of the largest game projects in the NFT field.
• Players can collect market-specific tokens “SLP” which can be used to exchange for other cryptocurrencies on the ETH platform.
• Token revenue is the reward that players get when they participate in the game or the trading market through NFT.

（Source: defikingdoms.com）

DeFi KingDoms

As an MMORPG game built on Harmony, DeFi KingDoms is also the largest DEX on Harmony. Presented in pixel style, the game visualizes all Defi functions and allows users to get rewards through utility NFTs. The project was officially launched in August 2021.

DFK was first published on Harmony, which was announced on December 7, 2021, and was available on AVAX. DFK will build related and independent worlds on the two chains. The world on the Harmony chain is called Serendale, and the world on AVAX is called Crystalvale.

Users who followed the project have spontaneously set up communities and guilds related to DFK early on.

DFK has heroes with diverse attributes and the value is difficult to evaluate. Moreover, the various tasks have formed an economic system with a certain degree of complexity. As a result, many volunteers have created tools, including Dfktavern which analyzes hero ecology and tracks hero prices, Dfktracer which helps users track the income of each module, and Dfkwatch which tracks project progress.

In terms of guilds, there are closed guilds such as DFK DAO that appeared in the early days, and its members include the famous Ansem who strongly supports DFK. Members of DFK DAO invested a lot in DFK in the early stage of the project, and also released many game strategies on Twitter. Moreover, the PVP and PVE gameplay of the game has also attracted more guild groups to participate in the game.

Multiple reasons account for DFK’s success in attracting attention in the early days and development all the way to this day:

1. With strong playability, DFK is especially outstanding in its gameplay compared with other blockchain games. Although the gameplay is complex, the relatively simple interactive logic makes it easy for users to get started, and the game threshold is actually low.
2. The product market is segmented accurately, which lies in DFK’s split-chain operation mode. Besides, the corresponding gameplay is distinguished by setting mild and severe restrictions. Therefore, the two types of player groups that pay attention to gameplay and economy respectively have their corresponding community centers, which can better attract more users to participate.
3. Undoubtedly, the company is attentive to investment in community operations. Whether it is the whitelist of high-frequency words and airdrop activities or the regular announcement of in-game activities, it provides users who join the community with a variety of participation opportunities and mega rewards.

On the whole, the operation strategy of DFK’s projects is more about the fact that its own product conception and design are highly matched. The subsequent operation and activity strategies are basically about the economic system and gameplay characteristics of the product itself. That’s, they focus on the content.

StepN

As an application built on Solana, StepN tries to explore the future form of web 3.0 by combining SocialFi with offline fitness. We can say that it has effectively combined SocialFi and GameFi, and it also supports two major mobile devices.

In StepN, users own NFTs in the form of sports shoes and obtain game tokens GST and governance tokens GMT by walking, jogging, or running outdoors. The tokens can be used in the game or cashed in for profits.

StepN is a Web 3.0 project, and its beta version was launched at the end of 2021. It has almost been a year. Though many ideas in the white paper about StepN have not yet been turned into a reality, it does not prevent it from becoming popular in the first half of 2022. StepN itself is an Australian project, and it is stated in its official announcement that it has no business in mainland China. However, its core team members are indeed Chinese and the project has obvious Chinese features.

StepN started to withdraw its business in mainland China in mid-2022. At present, StepN has no business in mainland China, as stated in the official announcement.

StepN has the following characteristics:

1. Participate via buying NFTs

   To participate in the StepN game, users must purchase NFTs in the form of sneakers from the in-app marketplace through the Solana wallet.

2. Strong relevance to reality

   Many NFTs are not very relevant to reality and are not very helpful to real life. But in StepN, you can not only exercise through games but also earn cryptocurrency (GST) from sports. It also supports the exchange of the game token GMT with other virtual assets (SOL, GST, etc.) in the application, which is very practical.

3. NFTFi Gameplay - Rental of Sneakers NFTs

   The renter and lender will reach an agreement in advance. Generally, the lender will receive 70% of the profit in GST tokens, and the renter will receive 30% of the profit in GST tokens.

4. Dual Token System

   Two main currencies are used in StepN: GST and GMT (Green Metaverse Token).

If users use virtual Sneakers while exercising, they will earn a game token called GST. This token has no upper limit but faces the inflation problem. StepN has designed appropriate scenarios that will consume the token, including upgrading shoes in the game, producing shoes, and trading shoes.


What’s special about StepN is that it also lists the cryptocurrency GMT with an upper limit as the governance token of its project. This way, the project party can allocate the consumption of the two tokens separately to keep the currency price stable.

StepN has put a lot of effort into the design of the game. However, it is still a product under the P2E concept. If we only take its so-called SocialFi+GameFi gameplay mode into consideration, it is not better than similar products in terms of its enjoyment. What appeals to users is the lucrative financial returns.

StepN uses high rewards to attract new users. This strategy has encountered issues in terms of sustainability. However, StepN has taken this problem into consideration in its design. That’s why it is different from some projects that solely use subsidies to acquire customers. StepN stipulates that users must first spend money to buy sneakers NFTs before joining the game. Users have invested a lot in this aspect, and this mode of focusing on attracting subsequent new users to enter the game is reminiscent of a Ponzi scheme.

In the following development, StepN encountered a crisis that we are all familiar with. However, early users and project parties who entered the game at the initial stage when it gained great popularity and huge investment have already gained their principal. As far as P2E is concerned, what the industry really needs is to achieve sustainable growth as a whole to support future development.

The Impact of P2E Games on the Crypto Industry

P2E games are rapidly transforming some patterns inherent in the crypto industry, and this process has been going on since its inception. It is against this backdrop of projects using the P2E model to provide users with opportunities to play and earn money. The boring gameplay cannot dull users, and a growing number of high-quality products are on the way.

In addition, P2E games have produced an effect on the current DeFi and NFT markets. What we all can see is that P2E games are not only focused on bringing joy to gamers but are also committed to increasing users’ awareness of various digital assets including cryptocurrencies.

With P2E games, players can use digital assets as part of the game process, rather than just making investments. This adds better application scenarios to assets with NFT and governance tokens as the main form.

Meanwhile, P2E games continue to attract thousands of new and enthusiastic users, many of whom are considering GameFi as the easiest way to enter the complex crypto world.

Conclusion

How do P2E games change the crypto world? In the past, not many people considered this question thoroughly. Starting the year 2022, that was about to end. Many ideas related to the future are afoot silently.

Whether it is GameFi or DeFi, they both are broad directions with clear prospects. P2E games are gradually turning people’s wild ideas into realities. Perhaps many people are pessimistic about the future development of P2E games. However, there is no doubt that many enthusiasts are trying to realize this grand vision. From some 3A P2E games that are gradually coming out, we can see something extraordinary.

P2E games are advancing rapidly in a predictable way that fully combines the advantages of the game ecology in Web2. Even when the market is bearish, they are booming like wildfire!

P2E games have played a crucial role in connecting NFTs and Web2 games. The basic principle of decentralization will be increasingly regarded as a consensus. With NFTs and the help of P2E games, more different user groups will get to know this market’s principles.