Heading into 2022, there are several trends in the crypto and blockchain market that have already shown significant promise. We have non-fungible tokens (NFTs), which took 2021 by storm and aren’t showing any signs of slowing down.
While many know that NFTs will be even bigger in 2022, another trend is slowly gaining momentum – GameFi.
Understanding GameFi for Beginners
In a nutshell, GameFi is the combination of three important parts of the blockchain space –decentralized finance (DeFi), non-fungible tokens, and blockchain-based games. It is essentially the gamification of different parts of the market, making way for more people to adopt a specific trend because they get rewards that can either be monetized or stored.
There are different GameFi platforms that are already seeing mass adoption. One such name is Legends of Crypto (LOCGame) – a collectible card game that is built on top of Polygon’s blockchain that incorporates NFTs and other DeFi elements while paying tribute to many of the admirable people who have dedicated their lives to the blockchain and crypto revolution.
LOCGame is one of the purest forms of DeFi. It operates a play-to-earn model, where players earn special collectibles representing some notable names in crypto. These collectibles and cards can be added to players’ collections, and they include NFTs, farming rewards, and more.
Merging With Other Concepts
Instead of just being solitary, some GameFi platforms have even moved to take advantage of other fledgling concepts. We now have GameFi and metaverse combinations, where players compete in a metaverse and battle it out for rewards.
Inasmuch as these platforms are taking advantage of trends like the metaverse to grow their popularity, the fact remains that they are providing value to their players. For now, that tactic seems to be working well.
Some Challenges Still Abound
Harnessing this play-to-earn model, the LOCGame is able to provide an entertaining experience quite like no other. Everyone loves the opportunity to win something of value, and this means that there is an amazing opportunity for GameFi to grow.
However, this isn’t to say that there aren’t challenges for this growing sub-industry. Going into 2022, GameFi developers will need to ensure that their platforms scale through several of these challenges if they are to really optimize their potential. Some of these challenges include:
Creating value for players
The first – and perhaps most important – challenge to scale will be that of creating proper value. As many know, the crypto market is rife with scams and other grifts, which disguise themselves under some banner of legitimacy or the other. The proliferation of these scams has led many to have distrust in the market.
Now, if you’re developing an ecosystem where gaming meets blockchains, you have to convince people that the rewards they get are valuable. If you’re running a GameFi platform where players get NFTs, what is the value of these NFT? Can they be traded, or should they be held? What is the guarantee that the rewards players get will be valuable to them?
This isn’t to say that you should simply throw money at the problem. Instead, it just means that GameFi developers have to find ways to communicate the value of these rewards, so as to incentivize more players to join in. Once you’re able to do that, you’ve solved a significant part of the problem.
People are more likely to join your platform and play your game if they know they’re getting something valuable in return. Convince them of the value in these rewards, and you’ll have them hooked.
User experience and seamless gameplay
One common theme with every trend that comes up in the crypto market is that platforms tend to have problems with user experience.
DeFi had this problem, with many DeFi platforms being too difficult to be understood and used. NFTs had the same issue – the steps needed to create, sell, or even buy an NFT remain overly cumbersome to this day.
This same trend is starting to show up when it comes to GameFi. While platforms offer opportunities to make money through their play-to-earn model, they also need to be easy to use.
Going into 2022, platform developers will need to find ways to make their services easily accessible. At the end of the day, no one will come to use what you have to offer if it’s not easy to use – no matter what you promise them.
Ties to the broader crypto market
Like it or not, every sub-industry under crypto will still be tied to the mainstream market itself. We saw this perfectly with the growth of NFTs. The frenzy surrounding NFTs was massive when 2021 started, and this pace was lept for the most part of the first quarter – and even some parts of the second.
However, when the mainstream market went sideways and coin prices tanked, so did the volume of NFT transactions. The same thing was seen with DeFi in 2020. DeFi volumes soared massively, thanks to peoples’ propensity to access financial services amid the coronavirus and the fact that the crypto market itself was pretty strong. But, when the market took a dive in the middle part of the year, DeFi volumes and activities dropped as well.
Going into 2022, we expect that there will be a massive adoption of GameFi platforms. But, if the broader crypto market itself decides to take a slide, it is entirely possible that GameFi will slide as well. To preempt this, developers will need to find ways to keep their activities up even when the market slides. This way, they can stay resilient in the face of a downturn.