Although there are some exciting things happening surrounding the play-to-earn gaming industry, some of which were covered in our last post, there are also some concerns. Here, we hope to cover a few of them.
Just recently, the South Korean government has made some changes to what they are allowing in their versions of the Google Play and Apple App Store regarding P2E games. There are concerns about the P2E industry utilizing new technology to take advantage of the consumers who are participating.
With apps that require in-app purchases before people can even play or interact with them, the South Korean government believes that this is just a new face on an old scam. A number of platforms require hundreds of dollars from players to purchase the necessary NFTs or tokens required to even start the game.
Additionally, there are already established regulations in South Korea about the amount of money that someone can “earn” from games like these. Just under $8.50USD, the amount puts a limit on the apps, but since many apps are calling these earnings “rewards” or “prizes” it can be difficult to uphold the regulation.
The government there has made this move in the interest of protecting people from spending too much money on something that is more akin to gambling in their eyes than it is to simply play a game. This raises important questions not only about the accessibility of these P2E opportunities to underage participants but also regarding how much of it can be regulated.
In a space where gaming and investing can coincide, another issue with the P2E market is that it can be hard to gauge which of the users are there to actually participate in the in-game economy and which are just purchasing in order to cash out when it reaches an optimum level.
Many P2E games rely on the players to not only purchase the tokens used to earn but to use those within the game to help circulate things. Players use tokens to participate, spend on upgrades, trade or purchase items, etc. There are usually a set number of tokens created. That means that the more that the tokens are purchased, the more rare and valuable they become.
Players who choose to spend their tokens in-game to further develop their ability to earn more, or just to enjoy more parts of the experience can sometimes be shocked when a mass cash-out from the investor’s side takes place. After the value of those tokens reaches a peak, a lot of times due to a sudden rise in popularity, many investors will sell their tokens, basically tanking the entire economy of that game.
This happened just last year, with the game CryptoMines. Their in-game currency, known as ETERNAL, which was launched in August 2021, rose to a staggering $800 value. Then, in December, dropped to just $27, a 96% decline. Due to this, the company paused development on the game and even locked the ETERNAL currency, which means that it cannot be bought or sold, leaving all of those who had already purchased and had not sold basically wondering where their investment went. Although the company has stated that it hopes to have things up and running in early 2022.
However, events like this can cause a lot of concern and fear in the market. As stocks do, the value of cryptocurrency, including P2E tokens, fluctuates. However, instances like this may cause more of those mass cash outs to occur in the future as investors and gamers alike may act more quickly, not wanting to risk ending up with a lot of money tied up in something that may drop and then freeze like CryptoMines.
When cryptocurrency first took off, there were tons of people that suddenly jumped into the market, looking to continue making their own fortune. Things like this have happened with the traditional stock market as well (remember Game Stop?). The NFT and P2E spaces are no different.
More and more companies are announcing P2E and metaverse projects each month, and the market has become incredibly hard to read and unstable due to the amount of oversaturation and spotlight placed there. This can make it hard for players and investors to figure out which of the P2E platforms to actually join and spend on. Additionally, many of the companies that are popping up are increasingly derivative in an effort to capitalize on the short-term gains that they may find by launching as soon as possible.
But where does that leave users? When the fad is over, which of these many companies will continue to exist? Which will stand the test of time? With the experience not only being a
bout money, but about gaming, it can be difficult to immerse time, money, and energy in something that may not be around when the next big craze comes around. As this is true for most sectors, it is even more important for the P2E community as it blends a number of different users, all with different expectations.
Anyone in the gaming community is familiar with bots, the programs that are created to pretend to be humans in a game. Usually, these bots are there to boost stats for the user, or even to cause issues with the platform itself. With P2E combining cryptocurrency and gaming, this is still a very real issue.
While most games use the play-to-earn model that encourages players to spend more time to invest in the game, bots that are automated and working nonstop around the clock would be an unfair advantage, especially since there is real money involved. It isn’t just tricking people and the server to have a better score or something, it is possible that bots may one day be created that can change the in-game economy that is so dependent upon player interaction.
Typically, bots used in this fashion may seem very realistic, even teaming up with human players as they take on difficult tasks and earn rewards, but what is to stop bot users from having multiple accounts and reaping the benefits of the platform, without actually playing the game? In most MMORPG games, bots are not allowed, but many times are still used because it can be very hard to detect now that bots are more complex and fine-tuned to recreate a style of gameplay that seems human.
Obviously, this and the other issues listed above are things that can be concerning for those in and interested in the play-to-earn sector. As digital worlds, cryptocurrency, P2E games, NFTs, and more become larger than ever, only time will tell how these concerns will be addressed.
