The term “GameFi” is a relatively new term that if you are a crypto fan, you will probably hear more about in the future. It is the next generation of computer games and according to many experts, it will revolutionize the gaming industry. In this article, you will find out what GameFi exactly is, what achievements it has had or will have in the future, and finally, we will introduce some successful GameFi projects. Stay with us.
What is GameFi?
GameFi is made up of the two words “Game” and “Defi”. By the way, non-fungible tokens (NFTs) also have a major role in it. So, we can say that GameFi is a combination of blockchain games, decentralized finance (Defi), and non-fungible tokens. GameFi’s main aim is to let gamers monetize the time they spend playing, using cryptocurrencies or NFTs. It is based on the theory that besides having fun, gamers should have some income from the games they play. They are contributing to that game’s success and they are making it famous. Therefore, the whole profit shouldn’t only go to the game owners and gamers must have a share.
In traditional computer games, gamers only played games for the sake of having fun and gaining victory. In some cases, they even paid for gaining extra time or buying certain items. GameFi is exactly the opposite point of the traditional gaming industry. GameFi introduced the concept of “play-to-earn (P2E) games”. In these games, users get paid for their skills or for the time they spend.
The way P2E games pay their users may be different. Some of these games may pay their users in return for passing different levels, and some others may pay in the form of in-game assets. By the way, they are all similar in terms of paying their users.
To better understand the concept of GameFi, imagine a traditional video game. In this game, you pass levels and gather scores. In return, you earn in-game assets or gems that are only valuable within the game. For example, you can use them for buying a certain piece of cloth, or a weapon, within the game. These assets do NOT have real-world value. Now, imagine that you play the same game, but in return for the achievements, you receive cryptocurrencies or NFTs. You can then sell the cryptocurrency in exchanges, or the NFT in the NFT marketplaces. This is what GameFi is doing.
The etymology of the term “GameFi”
The first time the word GameFi was used goes back to November 2019. At that time, the founders of MixMarvel, a famous publisher of blockchain games, used GameFi in their speech at the global blockchain conference. Another well-known sample of the term being used goes back to Andrew Cronje’s tweet. Andrew Cronje is the founder of Yearn Finance. He mentioned GameFi in a tweet in September 2020. Since then, the term is used for referring to games that have financial factors and are based on blockchain.
What is the future of GameFi?
GameFi projects have attracted huge attention in recent years. To better predict the future of GameFi projects, we can analyze the development route of existing projects like Axie Infinity.
When Axie Infinity was released, the price of each unit of AXS was around $0.15. This is while in 2021, the price of AXS reached $160. Or Meta Soccer, a soccer game in the metaverse, had gathered 2 million dollars even before being officially released.
The technology behind blockchain games has significantly grown. Data shows that new blockchain games will gain a lot of fans, and they will even attract institutional investors. Some experts even believe that blockchain games will aid the public adoption of the whole blockchain technology. In brief, it is obvious that GameFi will have a bright future.
Some of the best GameFi projects
GameFi now includes a wide range of PE2 games with different gameplays and strategies. However, we will introduce and go through some of the most famous GameFi projects in this section.
Decentraland is a virtual world governed by the users. Each piece of land in Decentraland is a non-fungible token. In early 2021, Decentraland had 1,500 daily active users. In March, this number reached 10,000. MANA and LAND are native tokens of this ecosystem. MANA is an ERC-20 token and LAND is a non-fungible token representing pieces of land. The Decentraland ecosystem is developing every day. It has had cooperation contracts with projects like Aragon, Ditsrict0x, and ImToken.
The Sandbox is a metaverse in which users can play games, build, own their assets, and monetize them. SAND is the native token of this ecosystem and is used for all interactions and transactions. Sandbox has had had a significant success in mobile. It has been downloaded on Android and IOS devices more than 40 million times.
GALA Games is a blockchain gaming platform based on Ethereum. It has a native token called GALA. GALA is given to players as the reward. At the time of writing, GALA is being traded at $0.05. GALA Games is not limited to one game. It consists of a number of free games. Some of its famous games include Town Star, Mirandus, and Spider Tank.
In this article, we tried to investigate the concept of GameFi and its effects on the gaming industry. As you have figured out, Play-to-Earn games can act as a turning point for the mass adoption of blockchain and cryptocurrencies. With the high growth rate of GameFi and the unique use cases of NFTs, it seems that the future of GameFi is so promising and its growth vision is unlimited.