GameFi is an exciting industry in the cryptoverse and it has grown into one of the hottest trends right now. It is simply a blending of the words ‘game’ and ‘finance’ and it is also known as ‘play-to-earn’. According to Newzoo’s 2021 Global Gaming Market Report, the number of global gamers by the end of 2021 now exceeds 3 billion. In the same year, total global gaming revenue grew 1.4% year-over-year and stands at $18.03 billion, with mobile gaming revenue set to account for 52% of the total global market.
What is GameFi?
GameFi is basically the marriage of gaming and blockchain-powered financialization. It combines cryptocurrency, blockchain, NFTs, and game mechanics to create a virtual environment where players participate and earn money in the process. In simpler terms, making money while playing games powered by the blockchain technology. Whether through quests, trading, or other mechanisms, GameFi allows gamers to earn digital assets for their in-game efforts. Axie Infinity, Decentraland, DeFi Kingdoms, Bomb Crypto and Forest Knight are all great examples.
The upside to Gamefi is that, traditional games have allowed players to accrue and trade digital assets for decades, they could lose their investment at any time if the publisher shut the game down or went out of business. GameFi games, on the other hand, keep their assets stored on a distributed network. These operate independently of any single organization, substantially derisking the digital assets.
How To Get Started with Game Finance
The exact starter requirement of each game varies but most need their players to possess a funded wallet and buy a few items to participate.
- Crypto Wallet
A wallet houses crypto assets and NFTs and generally allows the running of digital businesses. There are several kinds and it can’t just be any wallet, they don’t all work with every crypto ecosystem. It is essential to check compatibility before setting one up. For instance, the blockchain game – Axie Infinity, is built using the Ethereum protocol, so an Ethereum-compatible wallet, like MetaMask, is needed to play.
- Wallet Funding
For games that do not allow players to grind out their first few units of digital currency through play, users will need to fund their wallet in order to start. The exact cryptocurrency or token depends on the game, to get started on Cryptoblades, for example, one would need to fill a MetaMask wallet with $SKILL– the game’s native cryptocurrency. To possess $SKILL, one will have to acquire Binance Coin ($BNB) and swap it for $SKILL in a decentralized exchange like Pancakeswap.
Wallet funding is not that complex and complicated. However, it is consequential to know that the process can be a little confusing.
- Purchase of items
GameFi games can be downloaded free of charge, but going forward, most titles cannot be played until there is an investment through some kind of purchase – sometimes a character, an NFT or an upgrade. These items might be expensive. For instance, to fully immerse oneself in the world of Axie Infinity, one would need a purchase of three NFTs that, even at the cheapest rate, cost up to the tune of around $600.
GameFi is not just the talk of the cryptocurrency world, but all of gaming. Andrew Wilson, CEO of EA, has stated that “GameFi and NFTs are the future of our industry.” And GameFi has metamorphosed to a potentially industry-changing trend. This represents an enormous opportunity for innovative developers, cryptocurrency lovers and game enthusiasts to start making real money from their passion.