Thus, only one can own the original digital asset. Just like in paintings in the real world, only one can own the original Mona Lisa by Leonardo da Vinci, and that makes it special and of high value, right? Where Can You Find NFTs? NFTs can be found on different platforms that allow one to upload an asset, turn it into something with a token on it that someone else would buy. As of now, assets with NFTs are digital art, game clips, virtual land, trading cards, and social media memorabilia, etc. Generally, anything that can be collected can contain NFTs. To create NFTs, first, you need to buy cryptocurrencies, usually Ethereum (ETH). Then get a digital wallet and connect the digital wallet to the platform you’re buying on. You can then set up your account on the website and add what you’re selling. Artists are usually offered “royalty” over the original art they put on sale, this means that they get a commission every time their item sells since the NFTs identify that he/she is the original owner of the item. Sounds good, right? It sets you up for months or even years of income, especially if your item becomes popular- just like the 10-second video artwork that sold for $6.6 million last February. However, it does not sound as easy as that, one has to pay a processing fee called “gas fee”. It is the fee for the process of putting the token into your asset and its cost depends on the supply and demand now. There are also tips on how you can be charged with a lesser gas fee since it depends on the market, sometimes the gas fee becomes lesser in the early mornings or weekends according to experts.
Which Companies Have Started Utilizing NFTs? The start of the rush in NFTs is linked to the launch of the NBA’s Top Shot website last October where users can buy and trade NFTs in the form of moments in the NBA games- video clips of highlights. The most popular of which is Lebron James’ slamdunk clip that was bought by a user for $208,000. It is also said that the website already acquired $250,000,000 worth in transactions. NFTs aren’t still evident in the major arcade and battle royale games but there are already exclusive crypto collectible games that gained popularity. Ever heard of the digital kitty that was sold for $170,000? Yeah, you read it right! 600 ETH (approximately $170,000) was spent by a user for the CryptoKitty ‘Dragon’ last December. CryptoKitties collectibles are some of the very first NFTs, every digital kitty is unique and the goal of the game is to collect as many different digital kitties. The Ethereum-based fantasy football game Sorare is the most recent example of gaming NFTs. In the game, the cards of football players are collected by the user and he forms a team to challenge other users. The Sorare digital card of Kylian Mbappe, the forward of 2020 Champions League finalist Paris Saint-Germain FC, was sold for $65,000 in the recent auction. Here are other quick examples of record-breaking NFT earnings from companies: The one-of-a-kind “1-1-1” race car from F1 Delta Time sold for 415.9 ETH last May 2019. In January 2021, Alien #2089 was sold for 605 ETH which was approximately $750,000 at that time. This NFT is part of the CryptoPunk collection, the first NFTs ever created. Just a month after Alien #2809 was sold, CryptoPunk Alien #7804 sold for 4,200 ETH which is approximately $7.5 million. It’s now the most expensive punk sold. In the NFT-based game Axie Infinity, an Axie named Angel was sold for 300 ETH last November.
The Next Applicable Uses of NFT in Gaming It’s just a matter of time before NFTs take over the world of gaming. NFTs will be the greatest change to game monetization. They will allow gamers to own very rare and unique in-game assets- one-of-a-kind skins in Fortnite, weapons, armor sets, limited edition wheels or car packs in racing games, even virtual lands- anything with collectibles. NFTs can also pave a way for effective security tokens- eliminating the risk of buying fake game collectibles. As collectibles become in demand, extremely rare NFTs will also increase in value and the owners may also make a considerable income by selling such. Apart from transforming in-game ownership, NFTs can also help users create a single digital identity for all games. This means that one can move truly unique skins, experience levels, and other in-game items across games, creating a more unified gaming experience. The possibilities that NFTs could offer in the world of gaming are endless- from collectibles, game ownership, to income generation. Whether or not NFTs are here for the long run, it has been evident that they have caused a rave and they have the potential to make their owners a lot of money. NFTs have made a lot of changes in the digital world and it is yet to take over the world of gaming, so you still have a choice to make – will you ride this one out or ride in on it with full-gear?
Here’s how to get started with play-to-earn and NFT games. Learn how to choose your first game, set up a wallet, and start earning money. Not a beginner? We suggest you take a look at our in-depth game guides. How to choose a game It’s important to identify which types of games you like. Play-to-earn is simply an evolution of gaming, and the basic assumption should be that you enjoy what you’re doing. If you get bored or feel like you’re working, then it’s probably not the game for you. Here are some questions to ask yourself when choosing your first play-to-earn game: In the beginning, you may want to start with a free-to-play game. This will give you a chance to test the game mechanics for free before committing financially.Check out our list of playable games where you can learn about their price, non-fungible tokens (NFTs), overall rating, and profitability. How to create a crypto wallet If you want to get started with play-to-earn games, you’ll need a crypto wallet. This will allow you to connect to the game and purchase NFTs. The most popular free online wallet is “Metamask.”
Metamask comes as a browser extension or mobile app. It allows you to store any cryptocurrency on any chain you might need. Although popular, please note that Metamask is often a target for hackers. Be careful while using it, and never share your password and seed phrase with anyone. For maximal security, look into physical wallets to store your coins and NFTs. A physical wallet secures your cryptocurrency in an offline device that can’t be hacked. While better for security, you will still need Metamask or an alternative online wallet to access most games. You can then transfer your coins to the Ledger. Creating a wallet is easy. Check out the video below for a Metamask tutorial. For Solana-based projects, we suggest you use the Phantom wallet. Phantom is the most popular wallet on the Solana blockchain. In this tutorial, we show you how to use it to store and trade your cryptocurrency and NFTs on the Solana network. Wallets and security All wallets serve the same purpose: they serve as your own crypto bank. You’ll need a wallet if you want to store Bitcoin, Ethereum, or Axie Infinity tokens. The same is true for all transactions, as the wallet also serves as a validator.
SolanaIn order to buy NFTs on any marketplace, you’ll need enough cryptocurrency for the transaction, gas fees, and a correct connection to the blockchain. Most NFTs live on the Ethereum blockchain, hence you’d need a wallet compatible with Ethereum to finalize the purchase. Once purchased, the NFTs are also stored in your wallet, which makes the compatibility with the chain even more important to keep in mind. It’s crucial that you remember the 24 words Metamask, or other wallets, give you at the beginning of your Web3 journey. No one in the world can help you remember or retrieve those words, and if you lose them, all your funds are gone. In no circumstance will a valid, trustworthy institution ask you to share your 24 words. If someone does, it’s a scammer. How to buy cryptocurrency? There are several ways to buy cryptocurrency, and the best method depends on the crypto you wish to acquire. If you own a Ledger, you can use their companion application, Ledger Live, to buy and swap almost any crypto. If you don’t, you will need a companion to your Metamask / browser wallet to buy the coins you need to play. Buying cryptocurrency on a centralized exchange Cryptocurrency can usually be bought directly through a centralized exchange (or CEX). The most popular centralized exchanges are FTX and Crypto.com.
Using FTX.US and Crypto.com is similar to registering with a financial institution. Although easy, the process will be long and will require several authentication methods. You need to complete the verification process in order to purchase or transact on the platform. FTX, in particular, is easy to use and allows you to buy all the major cryptocurrencies. You can buy BTC, ETH, USDT, and much more. Binance, on the other hand, hosts a bigger collection of coins, plus a private exchange where you can swap your crypto with other users privately. You will be charged a commission fee (this is called “peer-to-peer trading”). Binance also has its own chain, Binance Smart Chain, and its coin, $BSC. All three CEX allow users to pay with a debit or credit card, giving you a quick and easy avenue to transmute your fiat currency (EUR, USD, GBP) into cryptocurrency. Buying cryptocurrency on a decentralized exchange Remember that not all cryptocurrencies can be bought on a centralized exchange. New games, or even established titles, will sometimes use decentralized exchanges only (DEX), where the only available method of purchase is through other cryptocurrencies.
This means that you might not be able to buy a game’s governance token with your debit card. Instead, you’d probably need to buy Ethereum first and then swap that Ethereum for the game governance or reward token. Generally speaking, ETH and wETH are the most important coins to keep in your wallet, as they can be easily purchased with fiat and will be used for most transactions or swaps. To swap ETH with other coins, use a platform like Pancakeswap for the Binance Smart Chain or Quickswap for Polygon-based projects. Please note that a DEX is not as safe as its centralized counterparts. Liquidity is mostly provided by users through the use of “Liquidity Pools,” where other cryptocurrency owners stake their coins. Only operate on decentralized exchanges you trust and that have a large user base. How to buy and sell NFTs? Buying NFTs NFTs are the second biggest component of play-to-earn games. While crypto coins allow you to profit from playing, NFTs are assets with in-game utility that can also be traded on the open market. NFTs in games can be anything, from characters to land, and are usually exchanged on an open marketplace. This marketplace is owned by the game development studio. There’s also a secondary market, where players exchange them with other players. A big part of the success of any title in the blockchain gaming space comes from how valuable NFTs become. The assets usually start at a low base price and grow with the game. Sometimes they sell for large sums, like in the case of Axie Infinity in 2021, where one basic Axie could cost up to $1,000. Purchasing NFTs Buying NFTs is a relatively easy process. You’ll first need to make sure that you have a wallet that can store them. Games often give you the ability to see and explore your NFT collection through their own tools, connecting through Web3 wallets like Metamask.
Binance NftWhen buying an asset in the marketplace, you’ll be asked to pay a buying price and a gas fee. A gas fee is a fee required to finalize a transaction on the blockchain. The small cut is used to reward validators: computers in the network that help the blockchain run seamlessly. The buying price is often split into two parts: one for the game developers, who earn a small percentage of all transactions in the marketplace, and the biggest portion, given to the previous owner of the asset. Sometimes, game developers can’t afford to build an in-house marketplace for NFTs. In this case, they typically resort to Open Sea or similar marketplaces. On Open Sea, anyone can list their NFTs for sale, or they can purchase other users’ NFTs. It’s like eBay, but for the blockchain. Joining a guild for minimal investment Sometimes, play-to-earn games can become quite expensive. In order to stabilize the market and allow every player to participate in the economy, groups of players started to aggregate in Guilds. Guilds are groups of users that collect assets and rent them out. They do this through smart contracts on the blockchain or private methods of handling renters for a profit. Just like real property, renting an asset is typically cheaper in the short term but can result in a loss of income and ownership in the long run. Players that can’t afford NFTs from the get-go are incentivized to start as renters, or “scholars,” and move their way up by playing the game. Once they become wealthy enough to purchase assets, they can start their own guild or participate in the treasury of a guild. Guilds typically store all their assets in a common pool, called a treasury, and rent them out through smart contracts on the blockchain. Whenever possible, Guild managers opt for complete automation and will split rewards in-game and fees from the renting process without manual intervention.
Gaming guilds on the blockchain are growing rapidly, with the biggest, Yield Guild Games (YGG), amassing millions in funding and two regional corporations. Their main focus is building up an Axie Infinity portfolio and renting out their Axies to players in the Philippines, who then return 30% of their income to the guild managers. Many guilds are starting to focus on multiple games, as YGG proved a single line of investments can be quite shaky. Axie Infinity has seen better days, and YGG is now trying to switch their focus to new games. Always do your own research when joining a guild. However, typically speaking, guilds are vibrant communities, usually hanging out on Discord servers. They can help you by providing assets, education, and a great group of friends to play with.To learn more about guilds, check out our FAQ and list of play-to-earn gaming guilds. What does Tokenomics mean? When talking about “Tokenomics,” we are referring to the list of rules and paradigms a game studio sets for its governance token(s). A governance token stabilizes the economy and is usually the token used to purchase NFTs in the marketplace.
Most tokenomics include a breakthrough of expenses and a big portion of rewards dedicated to players. The rewards are usually distributed with another on-chain and/or off-chain token. To give you a practical example, Axie Infinity uses $AXS for governance and $SLP for in-game rewards. In-game rewards tokens are usually less valuable and less scarce, while governance tokens represent a more unique token that also has added benefits in the form of smart contracts. To study the tokenomics of a game, you should refer to its “whitepaper.” A whitepaper is a document detailing how their token is spread amongst the team members, players, and game development. Most games are also covered daily by our writers, and our collective experience can help you avoid investing in unstable new studios. How to tell if the tokenomics are solid A sound tokenomics always includes: Sufficient funding for the developers A vesting period of at least 12 months A governance token that is listed on a centralized exchange (CEX) The governance token should be listed on a CEX in order to convert into fiat currency, such as USD, EUR, or GBP. If not possible, you should at least find it on decentralized exchanges like PancakeSwap or SushiSwap, where you can swap it for USDT / USDC, the most popular stablecoins nowadays. Here is a video explaining crypto gaming tokens Game economy / business model Play to Earn Business Model The play-to-earn business model is the latest development in the games industry. It’s a business model that embraces the concept of an open economy and provides financial benefits to all players who add value by contributing to the game world.
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