Stop me if this sounds familiar.

You’re checking out a new game. The trailer looks fantastic. The 3D models are deliciously promising. And the NFT land sales are going live in… just a few hours! So you connect your crypto wallet and buy a piece of real estate. Or a character NFT. Or some other “NFT asset”.

But the game never launches. It never sees the dawn of day, despite all the crazy sales numbers the project’s been publishing.

That was pretty much a common occurrence during the bull run’s GameFi craze. And that’s where we should leave all those shoddy practices because GameFi was in a sad and sorry state. As a gamer with a pretty solid background in economics, I watched with fascination as these early GameFi projects struggled due to faulty tokenomics.

So what exactly should we watch out for when looking at a closed economic system for games?

Faulty GameFi Tokenomics

I won’t start by calling anyone out by name here. Let’s just say I got into GameFi projects early. Like real early. And I made a ton of money out of one of the most popular play-to-earn games. 

And when I realized just how much money I was making, at first I couldn’t believe that it was real money. Then I checked to see if I could cash out, and I ended up swapping out my earnings daily. Guess what? Turns out, I wasn’t the only one exiting daily with liquidity.

And one quick glance at the Discord and Telegram chats made it painfully obvious that many buyers were confused by the tokenomics.

So let me give you a quick rundown of when your alarm bells should start ringing:

You check out a game and it looks pretty cool. But first, it’s smart to ask yourself a few questions about the game’s monetary policy. First, does the game need a constant influx of new users to sustain the price of the in-game currency? Second, is it only possible for the game to stay afloat with that new liquidity always coming in? 

Now ask yourself, does the game itself have any value? And here’s the most important question: Do people actually want to play the game? And do the game mechanics make sense? Because once that new liquidity dries up, so does the price, and then it’s “Buhbye, users!” 

Without gamers playing a game, what’s the value of the game?

This is the network effect in play, but with a vengeance. Back to the unnamed game I was just discussing. Burn mechanism after burn mechanism, the team tried a ton of approaches to try to keep the project afloat, while the token price plunged. At one point, they were even printing out non-fungible tokens (NFTs) like the Fed prints money.

But when your tokenomics model is faulty, there’s only so much you can do to plug away at all the holes on a sinking ship. And creating more inflationary in-game assets to sell is the reddest of red flags.  

What do Newer GameFi Projects Bring to the Table?

We had some hard lessons to learn from these early GameFi projects. Many of the newly emerging GameFi projects that appear promising went back to the drawing board and asked the basic question:

“Why do people play video games?”

It might seem like a silly question at first, but it actually digs deep into the heart of the matter. Another way to phrase it is, “Why don’t people play games?”  

So, armed with these basic insights, these newer GameFi projects are turning the early GameFi model on its head. How? Let’s look at a few things they’re doing differently.

Launching Fully Playable Experiences 

These new projects aren’t producing incomplete games and getting funding via early NFT sales. Instead, they’re focusing on launching complete blockchain games first. And that’s after conducting private fundraising rounds.

This approach could very well be how AAA gaming studios enter the space. But this path also opens up alternative fundraising options for smaller GameFi projects. 

Early projects found a surprisingly easy way of raising funds. Take money directly from customers, based on the promise of future delivery. 

Now they know a better and (hopefully more sustainable) way. Have they learned the lesson, though? Time will tell.

Free-to-Play NFT Games 

Another implementation that’s challenging earlier GameFi models is free-to-play (f2p) NFT games. By bringing free-to-play NFT games to market, gamers who want to try out a game first don’t have to worry about losing funds. 

They also don’t have to suffer the pain point of reselling the digital assets they’ve just purchased, should they find that the game isn’t for them. Obviously, this model is much more inviting and friendlier to gamers.

But before we move onto our last point, let’s unpack this situation a bit. Because as gamers, we know that cash grabs have been around long before blockchain games. But the GameFi space seems to be catching all the flak now, and that isn’t fair.

Are we forgetting that just last year, a major AAA studio (*cough* *cough* EA) rushed one of their legacy titles, Battlefield 2042, to market? It was so insanely buggy that the game tanked like crazy. In a matter of hours, mobs of angry gamers flooded Steam and left brutal reviews of the game. (You could literally drive a tank up the side of a building!) 

And all this janky gameplay after charging players the full price tag of $60. 

This brings us to implementing the hybrid model. Not everything has to be built on the blockchain. Earlier GameFi projects that built entire games on-chain faced many challenges. Issues included lag, gameplay stutter, and transaction fees, all of which amounted to a janky gaming experience.

So now, GameFi projects are finally implementing a hybrid model. That’s where the blockchain is implemented in areas that make sense. The most obvious area that can benefit is providing a safe and secure environment for peer-to-peer trading. 

We need look no further than web2 games like Everquest, Diablo II, and World of Warcraft as case studies in early in-game economic systems. I remember playing Diablo II, and conducting 1:1 trades was a lot like engaging in a cowboy standoff.

Each player had to stand on the other side of the screen, drop the item to trade, and run across to the other side in tandem. I got scammed once because my counterparty picked his item back up while I had already started running, and it was too late.

Obviously, a blockchain-based trading ecosystem that tracks the ownership of in-game items negates such instances easily.

Free NFT Games Worth Checking Out in 2023

So many amazing crypto games are releasing that we obviously can’t list them all here. But let’s go through several GameFi projects you’ve probably never heard of that we’ve got our eye on.

The Beacon: An Action Fantasy Roguelite RPG 

Source: thebeacon.gg

Beacon.gg is an action role-playing game (aRPG) built on Arbitrum. In its current Early Access state, Beacon looks like it could shape up to be the classic definition of a free-to-play NFT game.

The gameplay is incredibly limited, albeit smooth as eggs. You can visit 3 sections at the moment: 

1. Your Home, which is empty but which you can furnish via the marketplace

2. The tavern

3. A cave guarded by soldiers. (I haven’t been able to enter, for some reason.)

You can run through the Early Access inside 5 minutes. Sure, it’s just a taste of things to come, but if the studio can deliver, this game will be one to watch. If you want to give it a spin, once you sign in, you can do so by clicking here.

One caveat, though: I have no idea how the in-game economy is meant to shape up. The game looks promising, but will the tokenomics hold up?  

Delysium: The First Playable AAA Web3 Game?

Source: Delysium

Delysium is a thing of beauty. The team presented one of the most creative whitepapers I’ve ever gone through. The game is built on Immutable X. To play the Early Access, you have to hold a Delysium Multiverse License NFT. One hundred of these were given away as a free mint, but you can still pick one up on a secondary marketplace.

Along with the shiny AAA trailers, the game looks heavily inspired by Cyberpunk 2077. Unfortunately, I didn’t want to pay 1,000 USDT for a pass to test out the game. That’s why I only got a sneak peek from the Pre-Alpha highlight gameplay reel, which is admittedly awesome.

Is it representative of the actual gameplay, though? I’m actually confident it is. That’s because if it wasn’t, gamers who do have access would have caused quite a stir. So far, I haven’t heard a squeak, except for incredibly positive reviews. 

The game’s ecosystem does seem to be relatively complex, with NFT and token staking for its DES token, diverse free-to-own universes and more. Regardless of the seeming complexity, this game’s on my watchlist for 2023.  

Oath of Peak: A Mobile MMORPG with Blockchain Elements

Source: Yeeha Games

Oath of Peak is an oriental MMORPG released by Yeeha Games, Bybit’s gaming platform. Having launched recently on Polygon, the game offers a complete experience, so you can play through the whole game. More than $20 million has been invested into developing the core gameplay alone, which is impressive, considering it’s free to play (!). 

You enter the game as a Spirit Bender ready to venture out into the Omnispirit Realm. These Spirit Beasts roam these vast 3D-rendered lands, waiting to be captured. The game is also designed to encourage interactivity with other players.

Roughly 90% of all in-game items are generated by players playing through the game. So the items come from monster drops, crafting furniture, capturing spirit beasts, getting rewards from raids, PVP, and so on. Only a small element was made into on-chain assets, like Primordial Spirit Beasts (PSBs), which provide players with more freedom to interact with these assets (and potentially selling them off or trading them on the secondary market).

Another trend in Oath of Peak is that it’s available on more than one platform, so if you’re on PC, you’re good to go with an APK on hand. On the go? Then go with one of your mobile devices because the game’s available for download on Google Play as well as the App Store. 

Castaways: A Sandbox Survival Game to Build Civilization

Source: Castaways

Castaways is currently in Alpha, meaning the game is in its earliest stages of development. Despite that caveat, the game’s actually pretty fun to play in its current state. 

You enter the F2P sandbox on a tiny raft surrounded by the ocean and an island, and some other castaways. Flotsam like sticks and pieces of rope start appearing in the water, as well as fish. You can gather these items for free by drifting alongside them. After a bit, you can start to craft more advanced items like spears and fishing rods. 

Once you’ve got a fishing rod, you can start to fish. I’ve fished swords, empty tuna cans, and yes, even fish. To fish successfully, every attempt tosses you into a Dance Dance Revolution control-type mini-game. Key in the arrows successfully, and you get items. 

You can purchase game character NFTs, rafts as NFTs, islands, and even treasure chest NFTs. All of these items were airdropped to the most active players in early Alpha. The team’s just announced Season 2 treasure chests on their Twitter account too.  

Castaways looks promising. And considering how fun it is in Alpha, the game sets high expectations for what it could really be when it delivers. 

Star Atlas: Can this Play-to-Earn Game Pull It Off?

Source: Star Atlas

Star Atlas isn’t a free-to-play game, but it’s an interesting one to watch as it’s still pressing on with the early GameFi model. I’ve got mixed feelings about Star Atlas, and that’s coming from a Solana degen. (Star Atlas is arguably the biggest game offering coming to the chain.) And as the image above shows, the art direction is incredible. 

To be fair, the team has been building the game since the early days. Still, their lack of adaptation may be risky. And that risk isn’t just on themselves, but on the entire crypto gaming industry.

Sure, the AAA trailers are stunningly impressive. But the game isn’t ready, so you can’t play it. They have a few mini-games, but that’s it. Still, they’ve been doing presales for ships, some of which have gone on sale for $1 million+. 

So who’s buying these ships? Are they gamers? Or investors? And how will they be able to justify the returns? Star Atlas would have to deliver in a major way for all this to make sense. Maybe I’m missing something, or maybe I just like games that I can play right away. 

Blockchain Games: Where Do We Go From Here?

It’s become clear that we need to abandon the older tokenomics models. There’s no point trying to rework something that’s fundamentally flawed. 

We need to think bigger. 

We must reposition ourselves in the market as explorers of new gaming models who don’t want our customers to assume our risks for us.

As builders and explorers, we’re the ones who must assume the risks. That way, we’ll garner more respect from our gaming community. And as a bonus, they’ll be a lot more trusting and less skeptical when we try to bring them in.

So in closing, let’s get back to our earlier question: Why do we play video games? Surely, it’s ultimately about having fun, and not about earning, right? After all, no one drops on the couch after a long day of work and thinks, “Oh I want to play my favorite game, but I have to check the market first.”

Having said that, play-to-earn games will probably be here to stay. They’ll likely be relegated to a smaller role, though. Play with the optionality of earning will probably be the future of GameFi, which is a model that’s friendlier to traditional gamers who don’t want to interact with blockchains in any way… that is, until blockchains become so commonplace that they’ll be everywhere and normalized. 

Until then, let’s work on bringing the fun back to gaming.

For gamers, check out our list of NFT Games to Play, or get started with Immortal Game and its free-to-play mode!