GameFi Tokenomics 101 - How The Biggest Blockchain Games Use Altcoins

Rising out of the confluence between blockchain and gaming, GameFi has taken the world by storm. A central aspect of what sets this market apart from its regular gaming counterparts is the inclusion of digital assets. From incorporating NFTs into gameplay to creating comprehensive token-based economies, these games have taken the financial element of play-2-earn gaming to a whole new level.

One core aspect that sets apart successful Play2Earn projects and those that fail to capture a user base is solid tokenomics behind the project. Acting as a portmanteau of “token” + “economics”, tokenomic doesn’t only outline a public inventive to play a game, but it further ensures a sustainable economy for that system.

With clever underlying tokenomics, games are able to construct a token that users want to own and hold for long periods of time, while also providing additional utility to the game. It’s this balance between in-game functionality and real-world financial utility that evokes the greatest use of the tokenomic Play2Earn structure.

This is effectively summarized by Juanjo Chust, CEO of Arker Labs, a Play2Earn app development company which we’ll be discussing later, “We believe that the most important thing is to create good tokenomics[…] to give a clear and concise use to the token, making the token circulate and creating a healthy and lasting economy in the game”.

In this article, we’ll be exploring the GameFi tokenomics of some of the most impactful blockchain gaming projects around:

• Axie Infinity
• The Sandbox
• Blast Royale
• Plutonians
• Silks
• Arker: The Legend of Ohm

Without further delay, let’s break down these GameFi projects.

Axie Infinity - AXS

Axie Infinity is one of the largest names in GameFi, having an incredibly successful gaming ecosystem and a well-optimized token. Within this game, you’re able to fight against ‘Axies’, which are creatures distributed around this universe. By defeating and collecting Axies, you can go to battle against enemies, with each Axie having a certain benefit in battle.

The native token of this system is the AXS, standing for Axie Infinity Shards. While there are a range of ways to earn AXS tokens, such as staking, players primarily get new tokens by simply playing the game. $AXS is a direct reward from different games within this gaming ecosystem, providing users with an additional reason to play.

There are a select few main uses of $AXS, mainly encompassing:

• Staking Rewards - By entering $AXS into a staking pool, users can gain a return on the tokens that they’ve already earned. 
• NFT Marketplace - Users can buy unique NFTs that help them in-game by spending the $AXS tokens that they collect.
• Governance Token - AXS acts as a form of governance token within this ecosystem, allowing players to get involved with the voting processes behind Axie.

As a leading GameFi economy, Axie Infinity demonstrates a range of the primarily used native token elements. Especially looking at their comprehensive NFT marketplace, you can see how integrated their token is into the gaming experience of each player.

The Sandbox

The Sandbox is an expansive digital world where players can move around cities, attend events, or even create their own buildings on a unique plot of land. Much like Axie Infinity’s $AXS, The Sandbox’s digital token, $SAND, is also hosted on Ethereum’s ERC-20 utility token.

Players can generate SAND by allowing other players into their plot of land. For example, a player could build a beautiful estate and then host events on it, generating profit from their builds. Equally, players can create assets and then sell them as NFTs, collecting payment in $SAND.

This ecosystem allows players to put their collected $SAND to use in three ways, closely following the integrated playing mechanics demonstrated in Axie Infinity:

• Buying Assets - Players are able to buy costumes for their in-game avatars, buy assets to help them in-game, and upload their own assets onto the marketplace by using $SAND tokens.
• Governance Token - The Sandbox frequently hosts community events that dictate the direction that the project is going, with $SAND becoming a governance token that allows users the right to vote on new features.
• Stake - Users are able to stake their $SAND tokens in liquidity pools to earn even more capital. 

Closely resembling the tokenomics of $AXS, $SAND is a finite resource that is slowly being released into the system, providing users a range of functions.

Blast Royale

Blast Royale is a competitive battle royale-style arena, allowing large quantities of players to go head-to-head in a fight to the death. It follows in the footsteps of free-to-play games like Fortnight and Pubg, providing a similar experience but amplifying it through the inclusion of Play-2-Earn elements.

At the core of this platform is the Blastoken ($BLST), which is also minted on Ethereum’s ERC-20 tokens. While still in earlier stages than previous projects mentioned on this list, the projection of what their native token can do follows a very similar blueprint as $SAND and $AXS. 

Users are able to earn $BLST by performing well in matches, with the top players of every lobby receiving a higher share of $BLST per match. From there, users have three main utilities of the $BLST that they’ve earned:

• Governance votes - In the future, Blast Royale has suggested that they will use the $BLST token as a form of governance token.
• Exclusive Access - When NFT airdrops are launched by Blast Royale, those with $BLST tokens will be given an advanced warning and exclusive access.
• Crafting - Users can fuse multiple NFTs together that they’ve collected in-game or have bought in the store into a new, higher-leveled NFT. This process of crafting will require an input of $BLST.
• Purchasing and Selling - Consumers within this gaming ecosystem can use their $BLST to buy new items for their in-game characters. Each item scales with time, becoming more powerful as it is used more. Each NFT bought will give the user a unique advantage in-game.

The combination of NFT assets and $BLST tokens make the tokenomics of this ecosystem especially interesting, with the connection through the crafting mechanism pushing the bounds of play-2-earn that little bit further.

Blast Royale is also planning to release a secondary digital currency known as Craft Spice ($CS), which will only be obtainable in-game. This token will be more directly linked with in-game actions, like upgrading, repairing items, replicating items, and more. 

Plutonians

Plutonians is a combination of Web3 metaverse developments with Web2 multiplayer, creating a unique system that is the best of classic shooters mixed with strategy. With large aspects of co-op, building, collecting, and navigating, Plutionions sees the player take on the role of a pirate, looting and pillaging other vehicles while flying through space.

Alongside the community levels, users are also able to construct their own single-player missions, bringing a whole new element to the game. Plutionions intertwines blockchain tokens with the gameplay, with the act of traveling through space requiring the burning of tokens.

Interestingly, this is the only addition on our list which uses the Solana ecosystem to run its project. Alongside facilitating gameplay, users will be able to put the native token of this system, $PLD, to use in a variety of ways:

• Larger Ships - The larger your ship, the more it can carry, but the more tokens you’ll need to burn to get it where it needs to go.
• Expansion - As certain amounts of tokens are burnt, users are able to get access to different free expansion packs.
• Markets - The in-game tokenomics allows users to access the NFT marketplace, in-game DEX, and more.
• Yield Farming - Both yield farming through staking and NFT lending are all enabled by the central native token.

Plutonians is a great example of a GameFi game that is deeply connected to its native token, using this for almost every single aspect of the game. 

Silks

Taking a slightly different approach to the GameFi market, Silks is the first derivative-based P2E universe. Users are able to buy a Silks Avatar, using their 3D character to then interact with the Silks metaverse. From there, users are able to buy horse NFTs, bidding on specific horses and then storing them on their land or in their stable.

Each one of these horses is an NFT-minted digital representation of one of roughly 20,000 real horses born each year in the USA. Mirroring the 25-year, on average, life of a real horse, these NFTs have a comparatively real value when compared with the actual horse. Entered into races, these horses can generate the player value based on winnings of any races the horse performs in.

What’s more, even beyond the horse's lifetime, it can become a collectible item, the NFT going up in value even after the racing portion of a horse’s lifetime has passed. As these are based on real-life horses, each NFT is organically scarce.

Winnings will be paid in $SLK tokens, which can also be bought in exchange for $STT. As this pair is non-inflammatory, Silks aims to provide a stable tokenomics ecosystem. Users can put their tokens to use by:

• Raising - They can pay community farms to raise their NFT horses.
• Developing Land - Constructing land and making a house or stable on it can boost the value of the land, giving back to the player over time.
• Community Pools - NFT horses can be put into community pools where everyone gets a share of the winnings, this is a format of yield farming with users then getting a passive income on their investments over time.

The close mirroring of real-life horses makes Silks contain an element of realism that blurs the lines between fiction and reality; this tokenomics system integrating aspects of real-life to ensure its longevity.

Arker: The Legend of Ohm

Arker is an online world, where every user can control their own hero and pet on their way to retake the kingdom of Ohm. Within the game, users will be able to find and buy equipment, improve skills, and collect runes, other characters, and pets, all in the hope of leveling up and creating an unforgettable experience. 

Within this online world, users can fight against other players, group together and take on enemies, and complete daily missions in order to generate FoA (Fragments of Arker) tokens. These tokens are run on BEP-20, which is a Binance protocol, being the only one on the list to deviate from the Ethereum and Solana ecosystems.

Within the game, users can put their FoA tokens to use in a variety of ways:

• Payment - Users can buy items, skins for their characters, and more within the in-game store by using FoA.
• NFTs - NFT additions for a player’s character can be bought within the game, providing further utility to each player depending on which playstyle they favor.
• Pets - ARKER, another token on this system, is used for breeding pets, this being a great example of how integrated these blockchain principles are with the token itself.
• More to come - As a project that’s still developing, Arker is another example of a platform that has big plans for its tokens. In the future, we’re likely to see even more details of what FoA tokens can do.

One of the central visions of Arker is to create a tokenomics system that has long-term promise, with their ecosystem providing a stable income for players that’s more of a slow-burn than other games. This will ensure that players don’t blast through the total supply of tokens, the developers behind this platform seeking to create a more stable economy for the long run.

Final Thoughts

No matter what game they’re demonstrating, the vast majority of play-2-earn games reward their players for actually playing and progressing within their games. Whether it be awarding tokens for placing in the top five within Blast Royale or for progressing through more levels within Arker, there are many benefits to playing a GameFi title.

Going beyond just receiving tokens, all of the games on this list integrate uses of their Altcoin into the game, furthering the gaming experience while also offering a range of upgrades through trading or buying with their native currencies. GameFi titles are a wonderful example of how the world of blockchain is expanding to encompass other industries.

As these projects become more popular over time, we’re likely going to see even more features within these games, with the utility of each token being pushed to the greatest extent possible.

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