Over the weekend my fence blew down in storm and my entire family got the vomiting bug. Meanwhile crypto and NFTs prices look like they’re going to be heavy red candlesticks all week, probably all month if Mr Putin has his way.
On the other hand, Justin Trudeau is solidly reinforcing the case for crypto, I didn’t get hacked in the latest OpenSea phishing attack, and Vitalik is having fun dressing up in Denver.
Solve for the equilibrium, I guess!
But you know what I’m really still thinking about is — What comes next for guilds seeking play-to-earn alpha?
Passive is a self-styled experiment in passively-owning a “revenue-generating eSports team, starting with Axie Infinity” and it’s now looking for opportunities beyond Axie Infinity.
You can get an idea of its thinking in this rough spreadsheet of ROI across 15 different blockchain games. It’s pretty scrappy — I’m not sure how much I trust the numbers (there’s also no time frame) — but it is interesting given that half the projects are loss-making and the most successful is a gambling app.
More generally there’s a lot of rethinking currently happening in the sector. Hopefully it’s becoming clear to game developers that they are going to have to become much more sophisticated if they want to build a sustainable economic system that allows some players to immediately extract value and hence requires financial counter-balance from opportunities for other players (or investors or guilds) to acquire those assets to generate profit across a longer timescale.
As has been previously pointed out, this sort of thing is also an issue for proof-of-work blockchains such as Bitcoin as they require miners to sell some proportion of their rewards in order to pay ongoing fiat costs such as electricity, salaries, new mining rigs etc.
The sweet spot is to create an economy that has deep liquidity as well as a strong long term narrative, which it could be argued has been Bitcoin’s great success to-date.
But this is also how developed economies work IRL. We spend some high proportion of our salaries on day-to-day needs, but long term structural investing can only flourish if a surplus is available within a legal and financial structure to create a repeatable framework for high performing investment opportunities to be fulfilled by investment capital.
Network effects kick in and that’s why Silicon Valley is as it is and Marc Andreessen can spend his weekends trolling us on Twitter.
All about me
Of course, I can’t miss an opportunity to point out I also have a scrappy spreadsheet (still private), in which I’m trying to build up a picture of what games guilds have invested in, how much and more generally what games they’ve focussing on.
That will take some time to complete but suffice to say I’m tracking almost 50 games and around $100 million-worth of tokens and NFTs invested. Both are certainly underestimates.
I have another spreadsheet (now public) too, which is even more scrappy but an attempt to track all the blockchain games live and in development, combined with some rough quality filtering that will no doubt get me into all manner of arguments.
I’m almost embarrassed to share it — it’s so incomplete — but hopefully that embarrassment will speed my completion work.
Any omissions or additional information will be gratefully received via the following Google Form.
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