Play to Earn: The Why, What and How

The gaming industry is one of the most innovative, successful sectors in today's world and has risen exponentially in the past few decades. Moreover, in recent years, gaming thrived to become the primary choice of entertainment by overtaking the film and music industries. Thus, the global gaming industry is expected to be worth $250 billion by 2025. 

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From pay-to-play (P2P) and free-to-play (F2P), the gaming industry has advanced to earn while playing, a new concept which is known as play-to-earn (P2E).  With the explosive development and innovation of the gaming industry around the world, play to earn (P2E) games are now becoming mainstream. The “play-to-earn” trend is still an emerging phenomenon, however, what makes this system so unique is that it’s not only entertaining, but also innovative, profitable for the average player, and expansive. Along with P2E, even newer concept in blockchain gaming, Play-and-Earn (PnE) has also been recently introduced to the space. One of the main differences between P2E and PnE games is that players tend to play P2E games mainly for monetary incentives, while PnE games are designed for players to enjoy the game while also allowing them to make money. In this article, we'll mainly cover the P2E concept.

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It’s quite evident that younger generations love playing online games during their spare time, and just like everyone else, they also love making money while doing so. So, what makes play-to-earn systems attractive is that they offer entertainment and materialistic value for players’ time and skills. P2E is a business model that works in tandem with blockchain technology. Put simply, players can play a game and potentially earn cryptocurrency. This aspect varies and often depends on the type of the game one is playing, that game’s mechanisms, ecosystem, rewards system, etc., but majority of the games reward their players with something that has a value in real, as well as virtual worlds.

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Active P2E players often receive rewards like in-game assets and tokens which can be traded and converted into fiat money. Usually, these in-game assets and tokens are not just limited to the game, but possess value in the secondary market as well. In contrast to the traditional games where assets are only valuable within the borders of a certain game, P2E game assets usually have cross-border functionality and real-world value. NFTs play an irreplaceable role as a Web3.0 technology to maintain the ownership over these P2E in-game assets - there is no talking about play-to-earn games without talking about NFTs. 

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Nowadays, P2E games do provide gamers with an alternative source of income. Although people from some countries make a living by just playing these games, the token economy around P2E models must be built to last and the in-game assets must retain value in the long term. Building gameplay on the premise of NFTs is a great way to achieve that. 

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Just like in traditional games, the rewards you earn in P2E games mostly depend on your skills and the time you invest in them. However, people usually ignore the “elephant in the room” by not referring to the fact that most P2E games as of now work on the basis of “pay-to-play” which subsequently requires continuous flow of new players that invest into the game ecosystems so the existent players can be rewarded. This creates an unsustainable game economy where at some point, the true P2E aspect may fade away. Creating a sustainable P2E economy is the most significant factor to guarantee its success. Some people believe that the play-to-earn phenomenon will not live up to the hype and it'll eventually be replaced with PnE. And, that’s where our focus is with Mad Raid, where we are working to get the perfect recipe by combining F2P and P2E in a sustainable and rigid game economy. 

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Disclaimer: All information provided in the content is for informational purposes only and should not be perceived as investment, financial, or trading advice. Any investment decisions you make should be based on your personal preferences, financial expertise, and market research.

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About

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Parea Labs is a Web3 Gaming company that is driven by visionary ideas to provide various blockchain solutions and the excitement to build a user-focused, adaptive, and innovative gaming experience for all.