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The Problem
PlayToEarn, DeFi, and the Metaverse are hot topics in the cryptocurrency space. There are hundreds of projects created every day trying to take advantage of the hype; however, most of them face a similar problem, sustainability. Play-to-earn games encounter an inherent problem, creating a token that has enough value to offset its selling pressure.
Many P2E games have tried to solve this issue by creating two different tokens, a governance/utility token, and the reward token. However, this solution doesn’t work in the long term. If the reward token loses a lot of value, players will not be interested in grinding anymore as their reward value slowly dies.
In essence, most play-to-earn games, just like many DeFi farms, are practically Ponzi schemes. You basically need other users to come in with enough buying power to offset the selling pressure of the players that are earning rewards. Although this can work in the short term, it will simply fail in the longer term.
Some projects have succeeded by bringing a lot of utility to their native token, but no one knows if this practice is enough to be sustainable for years. P2E and DeFi are still extremely new, however, the gaming industry continues to grow at an exponential rate and it’s not going to stop any time soon.
Source: Newzoo​
The most recent statistics forecast growth of about $217 billion by 2023 for the global gaming industry. Play to Earn is not only here to stay but to take over. We believe the sustainability problem can be solved and will be solved.
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