The evolution of web3 has changed how we use and interact with the internet. One of the unique applications of shift is seen in web3 games. Web3 introduced the world with a new concept in gaming called GameFi which is short for “Game Finance”. It combines the immersive experience of gaming with decentralised finance leveraging blockchain technology. This combination creates a unique ecosystem where players can earn real rewards in the form of coins, tokens, NFTs, etc for their efforts in the game.

Let’s understand the mechanics of GameFi and how you can start playing such games:

How Does GameFi Work?

While traditional games have features like game progress, missions and achievements, they don’t offer any real-world utility or rewards for acing in the game. The GameFi model introduces various models such as play-to-earn, play-and-earn and move-to-earn that bring the same game experience but also reward users in tokens and NFTs that can be traded to fiat or other cryptocurrencies.

Let’s understand each of these models in detail:

Play-to-earn

Even though blockchain games have existed since 2017, the term Play-to-earn became popular in 2021 when games including Axie Infinity, Decentraland, and Gods Unchained were launched. The P2E model rewards users for their in-game achievements with rewards that have monetary value in the real world. These games combine cryptocurrencies and non-fungible tokens (NFTs) to offer this value.

Let’s understand the mechanics of the P2E model:

Tokenisation of in-game assets:

In P2E games, in-game assets such as characters, items and land are often tokenised as non-fungible tokens (NFTs). These NFTs are unique offering ownership and proving the scarcity of an asset on a blockchain. This tokenisation mechanism allows users to buy, sell and trade their assets in a decentralised manner.

Cryptocurrency rewards

The various game activities in these games are linked with cryptocurrency rewards. The users can complete many activities such as completing a quest, winning a battle, creating content or leasing assets and these activities are rewarded with cryptocurrency. This earned cryptocurrency is often listed on trading platforms and can be converted into fiat currency. 

Community participation and governance

Some P2E games incorporate decentralised autonomous organisations for governance which allows users to participate in the decision-making for the game’s rules and development. Such tokens offer a sense of ownership along with potential monetary rewards.

While the idea of Play-to-Earn games is unique, many such games could not offer sustainable monetary rewards to their players. These games focused mainly on the financial side but failed to provide a fulfilling game experience. That gave rise to two other similar models called Play and Earn and Play to Own. The former model focuses mainly on the gameplay but also offers small rewards to users and the latter model is based on the tokenisation system and offers ownership of various in-game assets to its users.

Top Play-to-Earn games

Decentraland

Decentraland is an open-ended metaverse platform built on Ethereum that lets you explore a virtual world built on blockchain. You can purchase or rent plots in this virtual world, build structures, interact with other players and also participate in a digital economy. LAND is the main NFT of this game and MANA is the native cryptocurrency that is used for various purchases.

Gods Unchained

It is a trading card game (TCG) with each card as a unique NFT. The players build decks with their best-collected cards and engage in strategic battles against other players. These cards are of various types such as Gods, Creatures and Spells. Each type of card represents a different type of power. In this game, the rewards can be in two categories, i.e. Flux and Packs. Flux is the in-game currency and packs contain new tradable cards. 

The Sandbox

Sandbox is yet another popular P2E game built on Ethereum similar to Minecraft. In this game, players can create, own and monetise their experiences such as owning land and building various 3D objects. The game incorporates tools like VoxEdit and The Game Maker that allow players to create animations and even other games within The Sandbox. SAND is the official utility token and LAND represents the NFT in the form of virtual plots.

P2E is a dynamic category with new game launches within months. You can follow the web3 and gaming communities to find the best games that are fun and rewarding at the same time.

Move-to-earn

Move-to-earn model is a unique application of the web3 movement that aims to integrate daily physical activities with rewards in the form of cryptocurrencies and NFTs. The move-to-earn(M2E) model followed the development of the P2E model. But in this case, users need to move in the real world or engage in certain physical activities to earn rewards in cryptocurrency.

Let’s understand how the M2E model works:

Activity tracking

The M2E apps rely on your smartphone or a fitness tracker to track physical activities such as walking, running, cycling, and heart rate. Based on the app, there are different goals that you need to complete every day or every week to earn crypto. For example, these goals can be daily step goals, distance travelled or active minutes. 

Gamification

Gamification plays one of the most crucial roles in certain M2E apps. Frequently, there’s an avatar in the game and the progress of this avatar depends on your physical activity. Some of these apps also include challenges, levels, and missions that make these apps engaging and fun to use. 

Social and Community Features

Many of the move-to-earn apps are habit-building games and the social element in these games plays a key role in the success of these games. These games allow you to add friends, engage with them, and participate in community challenges and other activities that motivate active participation from players.

Top Move-to-earn games

Fitmint

Fitmint is a move-to-earn app with an innovative approach to helping you build a daily walking or running habit while making it fun and rewarding.

The gameplay starts with your 3D avatar with 4 attributes: Level, Style, Strength, and Charm. These attributes contribute to an overall score that decides your daily earnings with FItmint. To improve your score you need to walk daily, participate in challenges, get better assets for your avatar and also have active friends on the app. FITT is the native token of this app and you can trade your FITT winnings to other cryptocurrencies or fiat currency.

Genopets

Genopets is a free-to-play mobile app that combines elements of Tamagotchi and Fitbit. Players take care of their unique Genopet by nurturing and evolving them through daily activities such as walking and running.
To begin with, players mint a free Genopet, which is an in-game NFT. The Genopet can be evolved by doing daily quests such as step challenges, player vs environment (PvE) battles, and taking it for a walk. GENE is the native token of this app however, some other tokens such as KI and XP are used in various activities.

Dustland Runner

Dustland Runner is a post-apocalyptic audio app that pays you to walk and run. In this game, players take on the role of a runner navigating through an imaginary world called Dustland avoiding pirates while completing real-world runs.

Your daily earning of DOSE tokens depends on various factors such as the daily reward pool, the number of players participating in activities during the same period, and the gear equipped by different participating players.

Similar to P2E, M2E is a dynamic and evolving market and there are always new app launches that may help you do your favourite fitness activities while having fun. You can try various apps and find the one that suits you the most.

Precautions

GameFi apps offer numerous exciting opportunities but also come with risks associated with web3. You should always look into fundamentals such as the development team, project roadmap, whitepaper and the tokenomics of the project.

Since these games are built on web3, they share the volatility of the web3 ecosystem. To be on the safer side, never invest more than you’re willing to lose. It takes time and effort to understand any project fully and you should take it slowly, explore the project for fun and only then consider investing more in it.

Conclusion

GameFi represents a monumental shift in the gaming industry and is still in the nascent stages. These games offer a unique opportunity to own a part of the game you love and also reward you for choosing a healthier lifestyle. By understanding the projects fundamentally and by being part of the communities, you can find new frontiers of gaming, and fitness and potentially earn rewards while having fun in the process.