Why hasn’t there been a hit blockchain game in this bull market?

Written by: Gua Ge, W Labs

I have been at the 2024 Hong Kong WEB3 Carnival for almost a week, and was packed with various meetings and interactions. I envy those talented people who can attend seven or eight shows a day. I have basically become face-blind after three or four shows, and I still feel a little dizzy on the plane.

Airplane mode is the best time to sort out ideas. This time, W Labs and COMBO jointly organized a blockchain game special Game House event. I thought I could speak longer in my own field, but I didn’t expect that as soon as I started to shake my head on the stage, the host kept pointing to the watch to remind me that it had been 5 minutes. Huh? I haven’t even finished my warm-up activities, and it’s over like this? Hahaha, fortunately, I have the Buff skill of text output, so I wrote down the thoughts that I started but didn’t finish, for reference by melon friends.

The first question: Has the WEB3 game track been falsified?

In addition to the activities held by GuaTian, I also participated in several panels with my friends. Everyone is still interested in the future of the blockchain game track.Xiaobai NavigationWhether it has a future is still a question, because up to now, this bull market has not produced a phenomenal blockchain game like Axie and StepN in the previous bull market.

But my point of view remains unchanged: if you are optimistic about WEB3, then you should firmly be optimistic about WEB3 games. History has proven that games are the entry foundation for an emerging industry to enter the application layer (C-end).

For example, the development of the computer industry relies on chip upgrades. In the past 50 years, the most important driving factor for computer chips is the gaming industry. 50 years ago, the popularity of Atari game consoles and the PACMAN game swept the world, which directly led to the emergence of the chip industry. At that time, Steve Jobs was working at Atari for the only job of his life.

Another example is NVIDIA in recent years.AI Nvidia has become the world's most outstanding high-tech handsome guy in the tide, but it was originally a manufacturer of gaming graphics cards GPUs, and it was the money in the pockets of hardcore gamers around the world that contributed to Nvidia's earliest cash flow.

Games are props for the general public to seek happiness and excitement. Those who win the C-end must first win the games.

The second question: Why haven’t WEB3 games developed yet?

The answer is simple: too early + too far off track.

If we don’t consider Crypto Kitty, which came out in 2017, the real blockchain game began to form a cluster effect from the popular Axie in early 2021. It has only been developed for a few years, which is too short. Let’s first look at the transformation and iteration process of the first two stages of electronic games.

The first transformation: 25 years ago, Atari and the Japanese Famicom transformed from selling hardware to selling software, as personal computers became popular. PC games became popular, from paying for game software to paying for online games on PCs, and companies like Steam that switched to distribution made a lot of money.

The second transformation: 15 years ago, mobile phones and tablets became popular, and heavy computers were no longer needed.Free to play, pay to playIf we continue to use the one-time purchase model of PC games, we will be out of date. Game-as-a-Service (GaaS) has become the mainstream business model for mobile games.

The second transformation actually brought about a big change in the development model of the entire industry: for example, the cost of personnel. After the PC game was launched, the staff began to be laid off slowly after the software was sold. Mobile games need to be continuously developed, and the staff cost needs to be continuously increased. At the same time, the customer service staff needs to be continuously increased to continuously stimulate players to continue paying. For example, more casual games and 5-minute games have emerged, because everyone has a mobile phone and has fragmented time, so playing a game or a 5-minute game is very suitable.

What will be the third transformation in the future? Some companies are betting on the Metaverse, and Facebook has even changed its name to Meta. The Metaverse is great, and everyone has seen Ready Player One, which makes people excited, but it requires a lot of money, and the infrastructure must continue to improve. For example, many players feel dizzy when wearing ordinary VR, and now Apple VR is said to be able to solve this problem.

In my opinion, the WEB3 games which are still in the early stage may also be a direction. Have you ever thought about what is the biggest difference between WEB3 games and WEB2 games in terms of the ultimate goal?If the game playability, entry threshold, project operation and talent pool are all raised to the same level, what is the difference? That’s right, it’s circulation and payment!

WEB3 games must be combined with the greatest feature of WEB3, which is to improve the convenience of payment and transactions.That is, whether it is payment in the game or payment outside the game, it can be operated smoothly without involving the strict restrictions of various countries and regions on various distribution platforms. Meta must have thought of this, but its stablecoin Libra was soon stillborn, probably because it touched too many external interests. Libra died, but the Libra team wanted to get rich quickly, so Sui and Aptos came into being.

I mentioned before that the current WEB3 games have gone astray because the first hit blockchain game Axie gave everyone a Play to Earn paradigm, so everyone thinks that blockchain games can only be Play to Earn, so basically all projects are copying Axie's model, because after all, Axie makes a lot of money.Sometimes I have been wondering if the first hit blockchain game was a casual chess and card game, a project that was closer to circulation and payment, would the current situation of the WEB3 game track be healthier?

But it is better to go astray than not to go at all. It is normal for a major trend to start with naked Earn. For example, the beginning of the Age of Exploration attracted so many navigators to take the risk of becoming pirates. It was not because everyone was still thinking about getting rich through trade (finding India and China to smuggle spices and silk), but because they happened to discover large silver mines and lucrative human trafficking in South America, so there needed to be a first wave of profits that were eye-catching enough.

In the future, greater wealth-creating effects will guide more teams to evolve in the direction of circulation and payment, so I firmly believe that the real bull market for WEB3 games has not yet arrived.The current situation of a lack of successors is a good opportunity for startup teams that are still preparing to enter the market. It will be too late to enter when competitors have already expanded their territory and conquered cities.

The third question: How can we embed circulation and payment into WEB3 games?

The answer to this question is complicated. We do not have the ability to discuss legal and regulatory issues. This requires bosses who have top-level resources to show their skills in different countries and regions.

Let's analyze it from the perspective of economic model. If we can build an economic model for a WEB3 game, regardless of the effect, it can basically reach the level of a graduate student in the economics department. Circulation and payment itself involve the operation of the entire economic system, just like how a real economy designs a fiscal system and a financial system. We need to first consider the basic level of the economy, the future direction of industrial development, the culture and cognitive level of citizens, international relations, and then determine the tax and monetary system, and then see how to adjust hard expenditures such as national defense, infrastructure, bureaucracy, education and medical care.

The economic model design of WEB3 games is different from that of WEB2 games. Many parameters in WEB2 games can have a large tolerance because they are difficult to cash out. WEB3 games are different. They involve "currency-based" or "gold-based" tokens that can be quickly cashed out. The imbalance of various parameter designs can easily lead to collapse. Imagine that so many economists and financial experts find it difficult to design a perfect economic model for a country, let alone us?

But being a keyboard warrior is still very tempting. Why were there so many knowledgeable big Vs on Tianya and Zhihu willing to give advice in the early years? Because it is a very pleasant process to put your thoughts into practice, even if they are on paper. Currently, WEB3 games can allow you to build such a system. Hero, you don't need to fantasize about traveling through time, just come directly.

Of course, 100 economists have 101 economic theories. Even within W labs, there are different understandings of the design of game economic models. I can only talk about my own views in general terms first.

1. First, compared to my friends in the Islamic sect who insist on decentralization, I prefer that the project needs to be regulated by visible hands from the beginning. Western free economics originated from Adam Smith's "The Wealth of Nations", which revealed the wonderful role of free market economy in human nature and self-healing. Later, scholar David Ricardo pointed out that under free trade, social division of labor and exchange can create higher value.

   But even Hamilton, one of the founding fathers of the United States, did not adopt the ideas in "The Wealth of Nations" when he served as the first Secretary of the Treasury of the United States. Instead, he used the theory of German Liszt, that is, an economy needs strong trade protection at the beginning, and strong tariff barriers are needed to protect the fragile industrial development of the country, and it is not released until it matures to compete with other countries' products. Don't look at the developed countries such as the United States and Britain shouting about free trade every day. When they first started, they protected their own industries more fiercely than anyone else. Slater, the father of the American textile machine, brought textile technology from Britain to the United States and is still called a traitor to Britain.

   The same is true for the WEB3 game model. At the beginning, we cannot allow various tokens to circulate too freely, as there are a group of hungry wolves like Soros waiting outside. Whether it is centralized regulation or guidance by internal mechanisms, we should first let them mature in the system.

2. Second, when the domestic industry gradually matures, whether to adopt the method of deep state involvement in economic circulation when Germany, Japan and South Korea rose in modern history, or the mechanism of small government and large market in the United States, Britain and France, depends on the style of the operation team. Both systems have successful cases. The first one rises quickly and can be effective in a short time, while the second one has long stamina and a healthy fiscal model. The two models can actually be transformed at different stages of development. For example, the United States adopted the first model in the Roosevelt New Deal after World War II, which was actually a replica of the Soviet Union's five-year plan, but the effect was very significant.

   From the perspective of the economic model of WEB3, the first model is based on asset appreciation, which can drive up the GDP (FDV) of the economy in a short period of time and attract more and more people to join; the second model is to collect taxes through a set tax collection mechanism in the circulation link, and the main income of the economy depends on taxes, which is similar to the casino operation model. The more perfect strategy is "first one and then two", but it is easier said than done. If you can achieve "one", you are already a dragon among people. You also have to control your greed and force yourself to give up the wealth that may be earned in a short period of time. For the sake of the illusory future, I guess most of the friends in the team will not agree.

   This actually answers the title question of this article. The hot-selling blockchain games in this bull market should at least have achieved unprecedented innovation in some aspect. Otherwise, users who are already tired of various Earns will not buy them. Or perhaps the innovation has already appeared in a certain project, just waiting for a detonation point.

3. Third, if a project is lucky enough to enter the "second" stage, then it will be a competition of circulation and payment methods. In the past few decades, the change in user consumption patterns has proved that whoever can improve the convenience of circulation and payment can lead the industry's transformation: swiping a credit card is better thanwalletCash withdrawals from online stores can promote consumption, and using Paypal or Alipay can promote consumption more than swiping a credit card. It is difficult to change the user's habitual inertia once it has been formed. For example, it is difficult to get a user who has become accustomed to Alipay and WeChat Pay to go back to the era of cash or credit cards. In the future, if WEB3 can lower the threshold of user consumption behavior more than WEB2, then WEB3 games will surely make a breakthrough.

   How can WEB3 games continue to develop steadily in the "second" stage?The current economically developed systems in the world generally achieve three points: limited free market economy, a social operation system with consensus, and the forward iteration of science and technology. Corresponding to WEB3 games, there are actually three points: eliminating circulation and payment barriers, decentralization, and the integration of the Internet and the Internet.contractThe mechanism allows players to build consensus and synchronize new technology developments in the gaming industry (e.g. AI and VR).

Summary: There will be new popular WEB3 games, please wait patiently.

End of this article.

The article comes from the Internet:Why hasn’t there been a hit blockchain game in this bull market?

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