Pros And Cons Of Play-To-Earn Model In Games

Play-to-earn is the latest game model that allows players to earn in-game assets that can be sold later on the market and then converted to real-world money. It has grown in popularity, especially with the rise of metaverse games that have made play-to-earn their go-to model. Users are able to farm or collect crypto or NFTs within the game, which is worth money in the real world, hence the name.

Like any new development, the play-to-earn model comes with its own pros and cons that serve as an argument for or against why it's a great model. This report takes a look at the advantages and disadvantages of having the play-to-earn model in games, as well as how it has been received by the community. Let's get into it!

Pros Of Play-to-Earn Model In Games

We first take a look at the pros of having this model in games.

Earn Real Money

Before now, gamers are able to make money from streaming and selling rare collectibles that they acquire within a game. These collectibles can be pretty expensive depending on the level and how popular the game is. However, the items sold by the gamers are only valuable in that game ecosystem. This is not the case with play-to-earn models.

In play-to-earn models, players collect assets worth money outside of the game ecosystem. This could range from crypto coins to non-fungible tokens (NFTs) that collectors can buy in external marketplaces. This makes the play-to-earn model worthwhile for gamers, drawing in those who would otherwise not spend much time on a game.

Loyalty

Play-to-earn models in games help to foster a loyal community. These communities are built from a mutual enjoyment for the game and grow from the value that gamers generate from playing them. Games with play-to-earn models boast some of the robust gaming communities. An example of this is Axie Infinity, a blockchain-based NFT play-to-earn game that is worth $2.9 billion.

Adoption

Another aspect that play-to-earn models have become important is adoption. For technologies like blockchain that are still emerging, it can be a slow-burn in terms of growth. But with play-to-earn models drawing people in, the adoption of blockchain technology is growing faster.

Development

With more players participating in play-to-earn games, the need for more development is higher than ever. Moreover, the adoption of the games provides much-needed revenue that funds further development of the game and the entire crypto ecosystem by extension.

Creating Value

Players in play-to-earn games do not only create value for themselves; they create value for the game. Developers of the game get revenue, and the players own the assets acquired in the game, all of which translate into tangible, real-world value.

Cons Of Play-to-Earn Model In Games

Just like there are pros to any model, there are cons associated with having a play-to-earn to model in games. Here are some of them.

Takes The Fun Out Of It

The rush to make money from play-to-earn games can overtake the enjoyment that people derive from playing games. In instances like this, an enjoyable activity becomes more of a chore where if a player does not make enough money, they are not having a good time no matter how immersive the game is. This can lead to issues like dissatisfaction from players.

High Cost Of Entry

The high cost of entry can be one of the disadvantages of play-to-earn models in games. Players usually have to cough up a sizable amount upfront to purchase assets that would allow them to access the game. These can come in the form of NFTs and can range from hundreds to thousands of dollars apiece. Usually, players will need multiple unique NFTs before they can access the game.

Loss Of Money

As mentioned above, the cost to access these games can run pretty high in some cases. Players usually try to recoup the money spent upfront by playing the game, but a number of things can hinder this.

Players may sometimes not be good enough to earn enough assets to cover their initial expenses. Inversely, there can be limitations to how much a player can earn in a period of time. Axie Infinity has been called out for having a daily cap on how much gamers can earn from completing quests.

Lack Of Infrastructure

Blockchain technology is still new. The play-to-earn model in games is even more recent. Both spaces still have a long way to go, and issues can arise in the technology's early stages.

Today, GameFi projects lack the scale and infrastructure necessary for mainstream accessibility, contributing to high upfront costs, fees, and potential network bottlenecks.

Furthermore, NFTs like the crypto market can be incredibly volatile. Their value can fluctuate from one hour to the next, making them risky assets to hold. In the same vein, market observers have warned that the high rate of interest in NFTs can lead to an economic bubble that could burst at any time.

Looking Ahead

The play-to-earn model in games still has a long way to go. As outlined, the industry faces several key challenges; however, we're already witnessing the emergence of some apps helping to overcome these issues. For example, projects like Meta DAO Guild are accelerating the growth of the space.

Meta DAO Guild is a decentralized autonomous organization that launched infrastructure services aimed at helping gamers to enter this rapidly evolving industry. It offers not only training for newbies and gaming NFT rental service. These services are already widely presented in the market by other NFT gaming guilds. Unlike others, Meta DAO Guild acts more ambitiously and launched three infrastructural platforms:

• Decentralized p2p platform where NFT owners rent their tokens to gamers, and gamers can rent NFTs without any payment (profit from gaming activities goes fifty-fifty to the owner and the gamer);
• DAO Launchpad, acting like a venture fund helping retail investors to achieve allocation during NFT token sales and benefit from GameFi investments made on an early stage of development;
• NFT trading platform MetaExchange where NFT owners can convert their assets from one game to tokens of another NFT game.

These services significantly reduce the barrier to entry by allowing players to rent/lease the assets that they would need to access these games through their P2P MetaRent NFT platform.

With projects like these in the space pushing development and breaking the glass ceiling, the play-to-earn model is undoubtedly destined for greatness. A solid digital economy and ecosystem are being built around them, laying the foundation for a long-lasting space.