In Brief:
Play-to-earn games have risen a lot in popularity, especially this year 2022. And, with the fame of cryptocurrencies and blockchain technology, it was expected that everyone would talk about it.
Play-to-earn games are a type of online games that give users rewards for completing certain tasks. These rewards could be cryptocurrencies or NFTs from the game itself. The foundation of the play-to-earn gaming economy is based on blockchain technology.
We will now show you more about play-to-earn games, but first, it is essential to understand blockchain technology.
Introduction to Blockchain
Blockchain is a technology-based on a chain of decentralized and public operations blocks. This technology generates a shared database to which its participants have access, who can track each transaction they have made.
It is like a large, unchangeable, and shared ledger that is written by a large number of computers simultaneously.
Every time a member of the network performs a digital transaction, said transaction generates associated data that will be stored in one of the blocks. When that block is full of information, the block is coupled to the already existing blockchain.
The information that is stored on the said network will depend on the purpose for which it was created.
It can be a network that stores payment data (cryptographic currency or cryptocurrencies), medical information, logistics or food traceability data, and even electoral data count.
In the case of play-to-earn games, the blockchain is used to create items that no one else can steal or duplicate, creating an economy around it.
The distinction between a blockchain and a centralized network (a regular server that stores data) is that the blockchain network is spread globally and not in a single location.
As a result, the blockchain network offers a number of benefits, including anonymity, decentralization (i.e., not relying on a centralized executor), and security.
When a new user enters a play-to-earn game, it is as if they are creating one of these nodes. The blockchain network will create this server data protection system, creating a secure economic network.
Play-to-earn Games and Blockchain
As we explained before, the blockchain is used in play-to-earn games for various aspects. Some games only use blockchain technology for their assets. And some games run their entire world on the blockchain.
Now we will explain the different levels that exist for these two types of games
Blockchain-Based Economy
When a game uses blockchain technology for its assets, it means that users can generate assets in the blockchain economy. This means that if a user finds or spawns an item, it will automatically be added to the player’s wallet.
When this item is added to the wallet, it is not converted to the in-game cryptocurrency, but remains as an item. This will allow users to collect high-value items, and trade these items with other users. These trades would be done on the game’s blockchain.
This type of games could be run on a centralized server. And the decentralized blockchain technology would only take care of the in-game economy.
All games that are play-to-earn, and use cryptocurrencies as assets, use this methodology.
Blockchain-Based World
Unlike the previous one, which could be based on a centralized server, this type of game is based on the decentralized network of the blockchain. This means that there is total decentralized governance.
This means that all users are the node of the blockchain network, and they are the ones that verify every action that other users do in the game. This is partly risky for creators because they lose more control. But it is beneficial for players as the risk of cheating is nil.
Some of these games can be run on existing blockchains. But, there are also play-to-earn games that create their own blockchain networks, which are used only by the users of that game.
Examples of play-to-earn games
There are already a variety of types of play-to-earn games out there right now: fighting, strategy, role-playing, and item trading.
An example is Alien Worlds, in which the user is a space explorer who must choose planets to mine; Based on your choices, you gain items and skills.
Another example is Splinterlands, which follows the typical collectible card-based gameplay and has become very popular recently.
Each of the cards represents power or ability; the player has to build a balanced deck and use it wisely in battles to earn rewards.
Rewards in play-to-earn games
The rewards that could be obtained in traditional video games, such as weapons or spells, now have a representation through a ‘token’, which is an NFT.
These NFTs are unique digital objects that have value and can be exchanged for real money. Armor can be represented by an NFT. And you could take it out of the video game environment and trade with it.
Starting to play is not always within everyone’s reach. To compete in Axie Infinity you need to spend at least $700 to buy a full team of creatures, called ‘axies’.
The reward for winning a fight can be around the equivalent of about 60 cents. At these prices, on average a beginner with basic axies could earn between 5 and 15 dollars a day.
This video game, born in 2018, generates sales of 84.9 million dollars per month, with 350 thousand active users per day.
How to cash out from play-to-earn games?
We have already explained how the economy of these games works, through the purchases and sales of NFTs from the game itself. But there also has to be a way to collect the money you’ve already generated by playing.
Depending on the game, there are a few different ways to cash it out. You have the option of receiving your rewards in the form of cryptocurrencies or selling your earned NFTs for cash.
Collect rewards in cryptocurrencies
If you want to cash out your rewards directly in the form of cryptocurrencies, here’s how to do it:
- For this example, we will use the Axie Infinity coin, AXS. First, you will need to deposit the cryptocurrency into your wallet account. To carry out this process you will need to copy the deposit address so that the money is directed to your wallet.
- Choose a suitable AXS trading pair for the wallet you are using.
- The next step is to sell the cryptocurrency, remember to choose a currency that can be converted to fiat. At this time one AXS is equivalent to 21.43 dollars.
- Next, you are going to convert your cryptocurrency to your preferred fiat currency, and then follow the process to withdraw it. This process can vary from wallet to wallet.
Sell the obtained NFTs
Another way to collect money is through the game’s own NFT.
As we already mentioned, the items obtained in the game will go directly to the wallet that the user connected or created to his account. And these are considered as NFTs of the game.
Well, one way to charge for these items is to sell them in the form of NFTs. Here we will show you how to do it:
- First, you will have to log into your account where the item or NFT is, and then search for it in your inventory.
- Then look for the option in your wallet to post it as for sale.
- After this, choose the fixed or auction price, and specify the duration of the auction.
- Then, you will have to wait sometime for the wallet team to approve your sale or auction.
- Then, when your sale has been approved and you already have a buyer, you can receive the money for the sale of the NFT.
- To withdraw it, you will have to follow the same process mentioned above, and that’s it!
