Good economy design and Tokenomics are the basis for any successful game. Understanding how these function in a game will give us a significant edge while conducting proper research on play-to-earn games.
The concept behind play-to-earn games is simple: players collect cryptocurrencies or NFTs produced in the blockchain-based game. Next, players generate income by selling in-game NFTs or earning cryptocurrency rewards, which can be exchanged for fiat cash.
As such, the importance of understanding tokenomics in such games.
Tokenomics in GameFi
Economy deals with the interplay between a player's experience and the impact the in-game economy has on that experience. It mainly focuses on buying/earning mechanics but also covers aspects of the player's experience, such as time taken, the number of actions needed to complete a task, etc.
For any game to be successful, the in-game economy has to be feasible. The stakes are even high in Blockchain games because real money plays a part here. The economy must be stable, self-sustaining and profitable for gamers and investors, so it needs good tokenomics to attract more.
Importance of Tokenomics on Blockchain Games
Tokenomics of any blockchain game has 2 functions:
It makes the game more economically interesting for players and attracts new ones.
It also means balancing further to avoid players being exposed to risks and overtime as the system collapses due to a lack of sustainability.
A well-designed tokenomics means a fun game that increases value and profits.
Contrarily, bad tokenomics can lead to rapid devaluation, a not-so-fun game with an unsuitable reward structure, progressive loss of players, and can lead to a collapse of the entire game's finance.
Tokenomics is typically based on a Virtuous cycle, giving players the opportunity to earn through gameplay and pay with what they earn. As a result, this will motivate them to play better and earn more. Apart from the player, the developers and investors should also find similar motivations.
The more the player enjoys the game and its rewards, the more he spreads the good word about it. As they say, your users are your best marketers.
Developers are always eager to improve/expand the player's gaming experience, which could be new features, bug fixes, and expansion of the game ecosystem, including resource tracking, market makers, etc.
Devs try to understand the psychology of players beyond simple motivation. Additionally, they recognize players come to a game with their personality types seeking different kinds of enjoyment. As such, it is essential to recognize this and create experiences that allow every player to enjoy their game.
The tokenomics should be designed to create core token dynamics for players to get tokens and spend them. If there are a lot of tokens in the market and no way to spend them, the token rapidly loses its value as there will be no reason to hold it and vice versa.
Takeaway
Tokenomics is vital to motivate all categories to support the game. In the long run, good games with strong economic layers, a market-fit product, and intrinsic views with freedom and transparency lie in the social value and winning opportunity of Web3 games.
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