There are only a few things in the world that go well together: peanut butter and jam, wine and cheese, NFTs and games. But what could be any better than the last one? Let’s take a look at how NFT games work and why they’re worth investing in.
First, what are NFTs?
NFTs or Non-Fungible Tokens are non-interchangeable units of data stored in a blockchain. Each NFT is unique and has its own distinct value, which means it cannot be traded nor exchanged with other NFTs. These can can take on many forms, including digital art pieces, music, memes, domain names, and game accessories. If you want to learn more about NFTs, check out our guide to this evolving cryptocurrency.
These virtual tokens have been the hottest topic in the crypto world since their release. The business leaders, high-profile artists, celebrities, and socialites cashing in on NFTs just this year have only directed the spotlights on this phenomenon. This craze has only driven more attention and speculation toward NFT projects. Then came NFT games, which have also shaken both the crypto and gaming space.
The gaming space
Did you know that in 2021 alone, 2.7 Billion people play games worldwide? 2.2 billion of which are active mobile game players, which make up 28% of the world’s population. It’s baffling! We don’t really notice it, but it’s almost impossible to find anyone who hasn’t encountered a mobile game in their lifetime.
This number has probably started snowballing since the beginning of the pandemic when people had more time to play games at home.
NFT games have soared exponentially as well, especially during the ongoing pandemic. One of these is Axie Infinity. Besides being a fun and creative game, it has surprisingly helped countless individuals who have lost their jobs thrive and support their families. It’s only one of the amazing feats of this new way of gaming.
How do NFT games work?
They work differently from just NFTs. NFTs in games vary depending on the rules and mechanics. Some of them could be the in-game characters, cosmetic items, or virtual plots. For NFT games that aren’t free-to-play, the starter characters could likely already be an NFT. Meaning, it’s already recorded in the blockchain. The same goes for the accessories and the ones you obtain progressing in-game. You can swap, store, or trade these with other players and eventually convert them into fiat money.
How are NFTs implemented in the game, you ask? It’s the developers who created smart contracts that we have to thank for that. These smart contracts are programs that make up the rules for the NFTs in the game. They are a series of self-executing computer code stored on the blockchain that allow for trustless protocols between players. In other words, it’s what allows players to trade items without having to know, much less trust each other.
How do you generate income out of NFT games?
Depending on the mechanics of the game and market demand, the items you earn that sit on the blockchain as NFTs can be traded with other players. This trading occurs in a market, auction house, or exchange. You will have to convert the cryptocurrency you earn into fiat money then can cash them out from the bank that’s linked to your game account.
The cool thing about in-game NFT assets is that usually, no two of them are the same. This means that your NFTs will only appeal to those who truly value them. In most games, the rarer the properties or characteristics of an NFT item, the heftier the price tag.
NFTs are highly speculative, so although their prices vary, it’s ultimately the other party that determines the value of the NFT you sell.
What are in-game NFTs?
These are the collectible items you obtain within the game as a player. Their market worth will vary according to their utility and rarity. Your high–end katana will likely sell for more than your basic dagger. This is usually how NFT games work.
In some games, you will have to earn a fungible ERC-20 token to trade particular items. An example of this is Small Love Potion or SLP in the currently most popular play-to-earn NFT game, Axie Infinity. Players use this to breed new axies and progress in the game. These can also be exchanged with Ethereum or ETH in the marketplace and converted to fiat money.
What are play-to-earn NFT games?
Play-to-earn is a business model that allows users to earn cryptocurrency through playing. In these games, players obtain rewards such as tokens and NFTs that, depending on their utility, can either be stored, used, or traded. As with non-NFT games, the tokens are usually needed to advance in the game. While token rewards are stable and can be earned steadily, NFTs, however, are more chance-based.
Some of the well-known play-to-earn NFT games besides Axie Infinity are CryptoBlades, The Sandbox, and Decentraland.
Are Play-to-Earn Games Free to Play?
Not all play-to-earn games are free to play. Some are free, while others require an initial investment for you to start playing. Why? We don’t know. What we do know is that every game, from PC to mobile ones, takes so much time, effort, and money to develop. Because of this, most developers will have to ask for a return on their own investment. After all, these games are a form of business, and the point of every type of business is to be profitable.
As for the free-to-play ones, it always depends on the plans of the developers. Most of them may not require a starting contribution but, as you progress, you will eventually encounter items, areas, or abilities that need money to unlock. This is where business happens. It’s worth noting that although these free-to-play NFT games may look easy to develop, they’re anything but.
At the moment, we can’t really find a good play-to-earn NFT game that’s free to play. Some are most likely scams, and you could lose money. So if you ever find one, never skip the research and be extra cautious. That being said, you could try some of our picks on free-to-play NFT games. You can be sure they’re safe.
Can I lose money playing NFT games?
If you ever lose some money, it doesn’t automatically mean you’re being scammed. Most of the losing part comes from the fact that Non-Fungible tokens, or cryptocurrency, in general, are extremely volatile. Simply put, the market forces play a role in your possible losses but that’s just how NFT games work.
Can I lose my NFTs?
Losing money aside, losing your NFTs is also possible. The blockchain is a dependable database, but it all goes down to how careful you are at handling and securing your NFTs. However, the chances of losing them are minimal. Some of the possible ways you could lose your NFTs involve the use of your wallet. But these are avoidable with improved knowledge of NFTs.
Here are some tips for you to make sure you don’t lose your NFTs:
- Do some research. Understand the types of blockchains your wallet supports and their tokens. The most common blockchain programs are Ethereum and Binance Smart Chain (BSC). Never assume the compatibility, and always make sure you’re sending your tokens to the right address.
- Make sure they’re not a scam. Ideally, you should only interact with smart contracts from trusted, reputable projects.
Just as you wouldn’t use internet banking without understanding how to correctly use it, do the same with NFTs.
Why Invest In NFT Games?
Compared to traditional computer games, NFT games ‘ace the game’ when it comes to practicality. You can play them for fun and also profit from them or use them to store money—like a bank, if you will. That’s why it’s been attracting millions of people worldwide. It’s a highly psychological type of gaming system that combines entertainment and making money—the two main activities driving mankind since antiquity.
That being said, NFT games are investments. In most of them, you are more in control of the value of your NFTs. The profit from NFTs, in general, relies on the market value. With other types of NFTs, you simply have to put up your item on the market, advertise, and wait. It’s basically the same in NFT games, except it’s a more active and interactive process. It’s safe to say that it’s a more fun ride in the crypto world with NFT games where you could use the digital assets you earn and upgrade them.
Want to start now?
Whether you want to go all-in now or take a pleasant stroll first, you can never go wrong with some of these NFT games on our list:
Final Thoughts
Until the arrival of blockchain technology in the gaming industry, digital assets in traditional games belonged to the game company. Now, the actual players can truly own their assets and profit from them by selling them on the gaming platform. What’s exciting is that many of the newest video games and upcoming ones are now NFT-enabled. This only goes to show how NFTs are revolutionizing the industry. With some of the biggest companies now entertaining NFT support, it’s perfectly reasonable to believe that the age of digital trading is slowly taking over eCommerce and the economy.
Do you need more info on how NFT games work? Or do you have any other topics you want us to write about? Leave them in the comments below, and we’ll get them to you. Stay tuned with us for the latest NFT game info.
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