Long-term trends in GameFi

Understanding a market isn’t about watching a trend evolve but about understanding what is behind the trend and where it will go next. In this article, I’ll share our vision of the processes that are now impacting GameFi — and how to use them to create a successful strategy.

You have to analyze GameFi in combination with classic GameDev, together with the general consumer leisure trends. Such emerging and rapidly growing niches of the entertainment industry as GameFi can’t exist in isolation from the social trends or from the economy. Therefore, in the first part of the article I will focus on the financial aspect (the Fi in GameFi) and then turn to the reasons and prospects of the trend.

Intangible assets are becoming an ever more important part of the current economic model — especially now that you can buy, sell, and trade them. The rights to these assets are separated from the assets themselves and traded as NFTs, tokens, stocks, coins, and other derivatives. This is a trend.

The most important part is that we’re seeing a new proto-market emerge — that of time spent on entertainment and leisure. This turns hobbies and leisure time into yet another way to buy and sell people’s labor. For companies producing products, rewards in the form of NFTs, tokens, and other liquid assets become another way to redistribute profit.

Offering the most attractive terms for players will soon become a crucial part of a sales strategy and of a product life cycle. It will allow businesses to create a strong economic link between the consumer and the product — and make the player depend on the product not only emotionally but also financially.

We can see this trend in the evolution of Play-to-Earn projects in developing countries. If you look at the NFT adoption and P2E audience metrics globally, you’ll see that regional leaders and semi-peripheral countries dominate. Their population is wealthy enough to afford a smartphone with an internet connection. But it’s also poor enough to view playing P2E games for many hours daily to earn $1000–1500 a month as a great alternative to a traditional career.

We are talking about an urbanized, tech-savvy population, the share of which in developing countries is constantly growing. These countries don’t have advanced state support…

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