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Can GameFi Crypto Acquire DeFi Success?

If you haven’t already heard about play-to-earn crypto games then you’re missing out on a giant crypto cash grab! Numerous Web3 companies and platforms have released their own spin on the GameFi Crypto concept – but is GameFi limited to play-to-earn, or is there more?

What is GameFi?

The term GameFi builds on the concept of DeFi Crypto, by adding a monetization aspect to the activity of gaming. Basically, a game existing on a blockchain that allows users to acquire or trade in-game assets or DeFi instruments is said to belong within the GameFi category.

Commonly called play-to-earn crypto games, the GameFi market is unbelievably vast and growing exponentially per day.

And no, the GameFi players don’t alone form its Market. The GameFi market is composed of many entities. Let’s familiarize ourselves with everything GameFi & how it’s inevitably connected to DeFi!

Following are a few examples of popular GameFi play-to-earn games that function on DeFi protocols:

  • Axie Infinity
  • Splinterlands
  • Alien Worlds
  • CryptoMines
  • And Many Others
GameFi Crypto

What is GameFi Crypto Market – An Overview

Consider the GameFi market as a sandbox or a type of GameFi metaverse, where players can become traders. Player A can sell or purchase in-game items to or from other players, which they can later trade for real-world monetary gains.

Such games are growing in popularity because they allow players to earn crypto assets while playing the game as usual. The earnings acquired by the players are often centered on a specific platform token, essentially of the ERC20 token standard.

Such tokens can be exchanged by users to purchase in-game items that can also be NFTs, or transferred to their crypto wallet to exchange them for fiat or plastic money. Hence, any investor or gamer owning the GameFi token(s) can be considered a member of the GameFi crypto market.

GameFi Crypto vs DeFi Crypto – Who Makes More?

It is a globally known fact that the gaming industry earns more than the music and entertainment industries combined. However, the same isn’t always true in the world of crypto where DeFi dApps are accessible across various blockchain networks.

Take, for instance, the GameFi metaverse can only exist on a particular blockchain, therefore offer tokens based on that network.

Alternatively, DeFi platforms can offer various monetization activities like crypto staking, lending, etc. across different blockchain networks.

However, the GameFi platform will need to partner with the CEX / DEX platforms to offer & exchange their GameFi currencies. So who makes more between GameFi and DeFi? It’s relatively a matter of 

GameFi Crypto

1. DeFi Offers Global Tokenomics

A DeFi Crypto platform can allow users to stake or lend their crypto assets or virtual currencies. Similarly, players can use their in-game currency for lending and similar purposes to multiply their yields without needing to interact with the game constantly.

Parallelly, enabling such types of transactions via DeFi systems helps to make the blockchain grow. Ultimately it facilitates the onboarding of newer players with existing assets in circulation, maintaining the trade volume.

2. DeFi Building Micro Economies

The various currencies among GameFi ecosystems can all be traded against each other, albeit at a respective cost via the DeFi platform.

Since each of them is primarily made as per the ERC 20 standard, these currencies can have their own economies of scale, wherein they can collectively drive the prices of other assets and in-game elements.

3. GameFi Ecosystem Depends on DeFi

The multiple functionalities within any GameFi metaverse hold reliance on DeFi Crypto asset management. Without smart contracts that fulfill DeFi demands, the GameFi systems cannot offer users varied opportunities to earn as they play.

Furthermore, the GameFi systems see over 80-100 million transactions per day, which cannot be executed without a dependable DeFi framework.

4. GameFi multiplies DeFi

The multiple functionalities offered by DeFi Crypto systems add to the gaming experience of every player. By collecting in-game crypto assets that can interact with the game elements, the users can upgrade them.

Such evolved assets offer better value which could otherwise not be sold without established DeFi protocols in place. For instance, an NFT of a character could have no use outside of the game, without its DeFi protocol, giving it value.

Also Read: Why is Bitgert BRC 20 Blockchain Quickest?

Why GameFi Crypto is Popular But Less Successful?

Despite having over 104,000 monthly active users across numerous GameFi ecosystems, the GameFi space has been slowing down. It is because the newer users are either fearful or facing established DeFi Crypto economies that are hard to acquire.

Still, the multiple GameFi launchpad projects are working full Steam ahead to onboard newer users via Free AirDrops, etc. Although such means can serve to populate the GameFi system, their user retention becomes questionable, especially after the first signs of any crash.

On the other hand, the DeFi systems continue to be the life force of GameFi systems and platforms, driving them to their fullest potential.

Final Words

To quantify whether the GameFi Crypto makes more than DeFi is a moot subject because of the factors discussed above. A better understanding of how GameFi can be fruitful to try can be further acquired by studying the aspects of GameFi IDO releases.

FAQs

Q. How does GameFi make money?

A GameFi Crypto platform charges a small gas fee for every transaction that the user makes towards the trade of any in-game elements or services. Multiple transactions of such types collectively add up to managing the maintenance cost of the GameFi blockchain services.

Q. Why GameFi is crypto’s hot new thing?

The GameFi systems allow users to make money on the assets they own within the game. By playing the game further, users can upgrade their assets or their crypto holdings. Hence why many GameFi launchpad programs are being released every week or each month.

Q. Is GameFi a company?

GameFi is a company founded by Vietnamese game developer Sky Mavis in 2018, whose today’s valuation is approx. $3 Billion.

Q. What is the utility of GameFi tokens?

The GameFi Crypto tokens offer broad utilities, wherein they can be the instrument used to upgrade or trade items in the game. Outside of the games, such tokens can also be exchanged for other crypto tokens or converted into Fiat Money.

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