Introduction
GameFi, or “gaming finance,” has exploded in popularity in recent years as the cryptocurrency sector continues to seek new ways to innovate on existing business models through decentralized networks that empower and reward the user instead of intermediaries. While GameFi is not a big new concept to the gaming industry, only a few projects manage to make the game fun to play while making money. The GameFi concept combines blockchain technology and gaming, allowing players to earn rewards in cryptocurrency for their in-game activities. To build a successful GameFi project, it is important to understand the key features of GameFi, which include the use of tokens (tokenomics), blockchain, and smart contracts.
Also known as Play-to-Earn gaming (P2E), GameFi, supercharges the gaming experience with elements of blockchain technology and decentralized finance (DeFi), helping put much of the real loot in the pocket of players, not centralized gaming studios. In GameFi, players can earn and trade digital assets, such as non-fungible tokens (NFTs) and cryptocurrencies, and use these rewards to help govern the direction of the game, all while playing games.
As investors and builders alike found out after the end of the 2021 bull market though, just like in traditional gaming, if you don’t give players what they really want, it’s game over. Most P2E games simply weren’t fun to play and their dismal tokenomics meant that constant token emissions required to reward and retain players inevitably crashed the native game token asset’s price over time and these diminishing returns sent players off to greener pastures. Even games that were fun but had bad tokenomics remain susceptible to a “death spiral”.
So, what does it take to build a successful GameFi project? If you’re new to crypto gaming or a developer who wants to get a holistic understanding of the sector, keep reading. In this article, we’ll explore the technical, marketing, funding, and legal considerations involved in building a GameFi ecosystem.
New blockchain gaming report shows GameFi is thriving
Still, the industry has taken the subsequent downturn in its stride, continuing to evolve. A new CoinTelegraph report on the Top 20 Most Popular Blockchain Games finds that GameFi is indeed far from dead, and is also learning from and moving closer to Web2 gaming to find the keys to success.
Gaming was responsible for half of all blockchain transactions in 2022, boasting a 60% increase in daily average users year on year. With over 1 million unique wallets connecting to GameFi DApps on a daily basis, it’s no wonder then that in the midst of Crypto Winter, VC firms sunk $7.6 billion into blockchain gaming.
GameFi also continues to evolve, moving from Play-to-Earn to new iterations such as Play-and-Earn, Move-to-Earn, Play-to-Own and Free-to-Own. These models innovate by offering free mints, exercise-related rewards, and generally a more balanced, entertaining, and ultimately sustainable gaming experience that aims to appeal to casual and serious gamers alike.
Web2 vs Web3 Gaming: moving closer together
The report also debunks the myth that Web3 gaming will replace Web2 gaming. Instead, they are learning from each other and building something new altogether. Some key takeaways are:
- Tokenomics in gaming needs to have a clearer path toward tangible utility, with a focus on sustainable tokenomics and long-term alignment with respective communities.
- Studios should focus on both traditional gamers and Web3 gamers to increase their total addressable market and bring scale. This can be achieved by becoming “Web2 front-end and Web3 back-end”.
- Gaming studios should focus on building games that are fun to play, rather than just building something around a token/NFT collection.
- Traditional gamers are currently intimidated by blockchain gaming, but with time and the development of infrastructure, more entrants will join the industry.
- Once a few Web3 games have millions of players, adoption of blockchain gaming by traditional gamers will quickly happen, eventually changing the label of “blockchain gaming” to simply “gaming”.
6 Actionable lessons for GameFi developers
With all these things to keep in mind, here are a few actionable general guidelines for GameFi builders:
- Understand the target audience and design the game accordingly. Consider creating a game that is easy to learn but hard to master.
- Focus on creating a strong narrative that immerses the players in the game world.
- Use blockchain technology to enable ownership and trading of in-game assets. Consider using non-fungible tokens (NFTs) to create unique, valuable assets.
- Use community feedback to improve the game and keep players engaged. Consider implementing decentralized autonomous organizations (DAOs) to give players a say in the development process.
- Use a token economy to incentivize players to engage with the game and hold onto their assets. Consider creating a deflationary token model to increase the value of the token over time.
- Consider partnering with other projects in the Web3 ecosystem to create a more comprehensive gaming experience.
Conclusion
In conclusion, to build a successful GameFi ecosystem, developers need to be able to create engaging and fun games while also integrating them with blockchain technology and smart contracts. Marketing and promotion are crucial for attracting new users and creating awareness about the project.
ThunderCore’s fast and cheap network capabilities have attracted a large swathe of GameFi developers and gamers to our ecosystem, where we retain and transform them into loyal community members by incentivizing them to move from Dapp to Dapp. We also constantly partner with some of the best and brightest in the sector, such as infrastructure provider MetaFab and the gamer guild YGG, while supporting developers with our Developer Growth Program to make their path to success easier than ever before! We’ve learned a great deal about what makes blockchain gaming and its users tick over time. By taking the considerations from above into account, you can build a successful GameFi project that can thrive well beyond the next bull run. Game on!
Read more: https://blog.thundercore.com/what-does-it-take-to-build-in-gamefi-4de51c79cd37
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