What are play-to-earn games & how do P2E games work?

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What are play-to-earn games & how do P2E games work? | iTMunch

The global gaming market is predicted to reach approximately $268 billion by the year 2025. No doubt, the gaming industry has grown and evolved like no other. Gaming enthusiasts have seen video games being played on palm-sized devices to computers and tabs to wireless consoles.

Similarly, with time, gamers have also grown from playing games for leisure to playing to earning money. Play-to-earn games give gamers real-life monetary returns as a reward for playing games. These games have given birth to a new ecosystem of digital economies, where players can create, exchange and sell in-game assets in exchange for money.

But what are play-to-earn games, how do play-to-earn games work and how can one cash out from P2E games? Find out answers to all these questions in this blog.

What exactly are play-to-earn games? 

Just as the name suggests – Play to Earn (P2E) games are games in which users are paid in some form to play. The concept is quite simple but is now turning into a revolution. These games allow video gamers to collect or farm cryptocurrencies and non-fungible tokens (NFTs) that can be sold on the market. When these games are played on a regular basis, players can earn more tokens or items to generate an income or sell them further. 

And what’s surprising is that some people have already started earning enough to replace or supplement their salaries while playing these blockchain-based games. Of course, it is to be noted that playing these games comes with its own set of risks. Some games also require players to put in an initial investment. The initial investment is typically needed for purchasing characters or items to play the games.

Old, traditional games were played in a centralized ecosystem. In a centralized ecosystem, developers had most of the power on the gaming experience. For starters, you spend so many hours playing a game collecting assets, like weapons, add-ons, characters, and additional powers, and one fine day all of it ends or disappears.

These add-ons can’t be transferred o another game, cashed out, or exchanged on a third-party marketplace. In conventional games, the game and players are dependent on the decisions made by gaming companies and developers. Play-to-earn games give control in the hands of players and put them at the centre of the economic engine which gives the ower-dynamic in the control of the players.

How do “play-to-earn” games work?

Game developers have been quick at embracing the play-to-earn trend. Many titles, like Axie Infinity, Gods Unchained and Splinterlands, have been trending and taking off. These (and other) P2E games rely heavily on blockchain technology for supporting their ecosystem and enabling users to access in-game built-in tokens that also have value outside of the game. This has been made possible with the help of cryptocurrencies (or digital currencies), NFTs, and decentralized marketplaces.

Essentially, every step you take in P2E games will be can be incentivized – from taking on challenges, fighting battles, helping solve a problem, or breeding new creatures. The elements are featured in the game are in the form of NFT. For instance – if you wish to breed a new creature or want a new avatar, you can easily mint a new token and then sell/exchange it in the marketplace.

The biggest benefit of NFTs is that they can be conveniently exchanged for crypto which can, in turn, be traded for real cash via exchanges. The transactions in the world of play to earn take place in the form of blockchain, hence authenticity and ownership of the digital assets in the game can always be verified.

SEE ALSO: Is Online Gaming a Social Lifeline During the Pandemic?

Blockchain and play-to-earn games

What are play-to-earn games & how do P2E games work? | iTMunch

As such, play-to-earn isn’t really a new thing. It has been around for a while. There are so many online games with fiat-based auction houses or even secondary markets that are maintained by gold farmers. For crypto-based games, the key difference is that these items and currencies exist on blockchains.

Blockchains have multiple properties that can easily prove ownership, rarity, and legitimacy. Blockchain networks can be thought of as an immutable database maintained by a distributed network of computers or users – each holding a copy of the blockchain data. 

Meaning that it is virtually impossible for anyone to modify, delete, or duplicate blockchain data. Blockchain games can be, as such, developed in a way that protects them from and prevents fraud or corruption, lie item duplication and other hanks and exploits that are common in conventional gaming. 

A key part of an in-game value of the item is how rare it is. With the help of blockchain, there’s no way to copy and paste it. If an item is an original piece, there is no way for someone to ever replicate it and this helps in creating real value for in-game items.

How much can you earn from P2E games?

Conventionally, gaming isn’t known for rewarding the user monetarily. It might also be tough for people to believe that earning money through blockchain games is possible. But it isn’t just possible, it is already being done by people in developed countries where they’re making a living out of it. 

The farming method, in which earnings are directly proportional to skills and the amount of time devoted to playing, provides a steady stream of income. The method has proven to be beneficial and popular in the Philippines, where games like Axie have become an alternative to unemployment benefits. Players can quite easily earn between $200-$1000 monthly through farming SLP. Of course, this depends on the market price as well as the playtime.

SEE ALSO: 8 research-backed benefits of video gaming you should know about

The changing landscape of digital gaming

It is quite clear that, over the years, the psychology around gaming has changed. Players want bigger roles in gaming. They want to buy and own assets they have played for so many hours to collect. They also crave unique experiences as well as the freedom to shape the overall future of gaming. Play to earn games aim to provide gamers with the same.

YOU MAY ALSO LIKE: Mobile gaming, its future & big names moving into smartphone gaming

For more latest IT news and updates, keep reading iTMunch

Source

[1] J, Clement (2021) Statista “Global video game market value from 2020 to 2025(in billion U.S. dollars)” [Online] Available from: https://www.statista.com/statistics/292056/video-game-market-value-worldwide/ [Accessed February 2022]

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Featured Image:  Technology photo created by DCStudio – www.freepik.com

Image 1: Technology photo created by DCStudio – www.freepik.com

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Riddhi Jain is a technology content writer. She is based in India and has been working as a content writer since 2018. Riddhi has been writing content in the tech domain since May 2020 and can’t get enough of it. Riddhi has pursued most of her education from her hometown, Indore. She has graduated as a Bachelor of Business Administration and discovered her love for writing blogs while pursuing an internship during college. Once she discovered her love for writing, she went on to improve this skill set (and hasn’t stopped since).
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