Historically, if gamers earned something in one of their favorite games, it remained in-game only, with no value outside that game on their computer or gaming console—but some companies are trying to change that.
Play-to-earn gaming—where players own the rewards they earn in the game—are becoming more popular. Think: playing Runescape or World of Warcraft where you might have some valuable armor or weapons (valuable in-game currency, of course), or even elite players in a sports game like FIFA or Madden Ultimate Team, but where players can sell those items for real-world rewards. Your Runescape Dragonfire Shield or Christiano Ronaldo FIFA card might be worth some actual money instead of Runescape gold or FIFA coins.
One Utah company, NFTy Arcade, is ready to capitalize on this trend. “We think this is going to be an appealing narrative in the coming years,” NFTy Arcade CEO Tyler Jorgensen says. “On top of that, we believe this technology—the blockchain, and cryptocurrency, and play-to-earn in general—is going to facilitate a transition of developing countries into the modern world. We believe that this is going to be the way through which developing countries adopt cryptocurrency.”
Jorgensen says play-to-earn gaming can even serve underserved communities by offering scholarships where NFTy Arcade essentially sponsors players who need some financial assistance with the entry costs to start participating in play-to-earn games. For example: To play Axie Infinity, one of the most popular play-to-earn games, you need three Axies (the creatures played within the game). As of writing, 1.2 million Axies were sold in the past 30 days for a total of 32,433 ETH, and Yield Guild, which has over 2,500 scholars playing Axie Infinity, receives 10 percent of a scholar’s earnings and a community manager—responsible for recruiting, training or mentoring the player—receives 20 percent.
NFTy Arcade, founded in 2021, currently has scholar contracts with over 200 players. “There is a barrier-to-entry, generally, for somebody in a developing country to start saving and generating wealth. If you live in Madagascar or Peru, you can’t really go and purchase a stock, you can’t easily go and utilize other investment field vehicles that are easily available to us,” Jorgensen says. “But if you have a digital wallet, you suddenly have access to DeFi, you have access to a litany of investment vehicles and a litany of different currencies, which is phenomenal. You don’t need to have a bank account, you don’t need to go set up with a broker, you don’t need to have all these contacts—all you need is a wallet. It’s incredible.”
And this will facilitate retail access and participation of play-to-earn gaming. In 2020, there were a record 2.69 billion video gamers worldwide, according to Statista. By 2023, that number is projected to surpass 3 billion. Play-to-earn gaming hasn’t taken over a large percentage of that market just yet. Jared Rhodes, head of R&D for NFTy, says that the way play-to-earn gaming has rolled out under Web3 to date has been “clunky” in some ways, and some people see play-to-earn as just a way to pump the value of NFTs, but eventually, he believes play-to-earn will be much bigger than it already is.
“I understand there’s skepticism, but the problem is there and the solution is there, and at some point in time, those worlds are going to come together,” he says. “And there are some really cool gaming projects that are coming out right now that have technology that are looking to do exactly that. So it’s going to be very telling what happens over the one to two years, but inevitably, in our opinion, those two worlds are going to smash into each other and become one and the same.”
All of this requires a lot of moving parts and NFTy Arcade is working on a management software platform to automate that process. “Being a guild, the management is quite intensive. We have to collect cryptocurrency, we have to pay cryptocurrency across hundreds of accounts, we have to do it in multiple games, we have to manage production across hundreds of accounts,” Jorgensen says. “And that process needs to be automated. You need to interact with the blockchain to do that, you’ve got to have an EVM compatible node, and then you’ve got to plug into the blockchain and essentially call a function that will allow you to just transact on the blockchain in general.”
But this is just the beginning. NFTY Arcade has completed a $1 million friends-and-family fundraising round, with another likely beginning in mid-March.