Will MagicSwap V2 rewrite the rules of the Web3 game economy?

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, the original author: William M. Peaster, compiled by Odaily translator Katie Ku.

Treasure’s latest official NFT tool, MagicSwap V2, “has the potential to revolutionize the Web3 game economy.” Below, Odaily will take you through the highlights of MagicSwap V2 and its impact on the growth of the entire Web3 game ecosystem.

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MagicSwap V2: A Game Changer for Web3?MagicSwap is a tool for creating an immersive gaming experience that allows users to focus on the game rather than asset prices.

Treasure's new MagicSwap aims to provide greater flexibility to players and game creators in its ecosystem. Treasure has just announced plans to launch a MagicSwap V2 NFT automated market maker (AMM) in Q2 2023. Treasure has designed a new and improved transaction method, making it the first AMM in cryptocurrency to support ERC-20 and NFT pools through a single router, and allow the transaction of all items in the game economy.

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The Importance of MagicSwap V2

Prior to this, there was no shared decentralized exchange infrastructure for both fungible and non-fungible tokens. For example, you can now go to Uniswap and trade ERC-20 tokens like MATIC, or cross-chain NFT like "Fat Penguin" sister project Lil Pudgys. However, the underlying infrastructure is currently independent: ERC-20 tokens trade on Uniswap’s traditional DEX protocol, while NFT trades on market aggregators evolved from NFT aggregation marketplace Genie.

What makes MagicSwap V2 compelling is that it is the first confirmed general-purpose DEX that we know of, and that it is custom-built for Web3 gaming, which is Treasure's specialty.

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How to solve the pain points faced by chain game developers?

Treasure is building a "decentralized Nintendo," a collection of games on-chain connected to each other through the interoperability of in-game assets and MAGIC (Treasure's native token) as a shared currency. Some of the most popular games include strategy game Bridgeworld, role-playing games The Beacon and Smolverse, and resource management and strategy game Realm. In this ecosystem, many different games have their own unique economic rules, which can promote common development. To this end, the new MagicSwap is designed as a flexible and open game economic resource that allows many projects to use it.

In addition to the general token compatibility infrastructure we have already discussed, MagicSwap will also provide NFT-to-NFT pools, NFT-based LP rewards, dynamic price adjustments, automatic royalties and bulk purchases of NFTs via ERC-1155 tokens (Sweep) function.

• In terms of gaming, MagicSwap will offer a range of new possibilities, including:

• Pool licensing options - game creators can choose how to trade tokens from the pool, allowing for more tightly controlled game economics + less excessive speculative trading;

• Spatial and geographic based transactions will be possible, so games can use MagicSwap to own in-game location-specific markets;

MagicSwap's custom pool option will allow game creators to facilitate trading "networks of different tokens" for players, and therefore, adjust which parts of the game can and cannot be tokenized.

Some Web3 games make their in-game assets too tradable, thereby lacking economic leverage, facing difficulties in fighting economic drains and excessive speculation, which may become "game killers". Therefore, one of the reasons MagicSwap V2 is so compelling is that it provides an open resource for Web3 game developers to flexibly manage their game economies as needed.

Magicswap enables GameFi's reverse functionality. Financialization only exists in certain types of game items, namely NFTs that are sold peer-to-peer of value. Game currency is used for gameplay and minting/upgrading NFTs with economic value.

“For example, the game allows players to exchange various resources, but not for dollars. If players can create ways to upgrade their characters or create rare items, the game can include a certain degree of financialization. These rare items can be sold in the Trove market. It can be sold in a peer-to-peer manner on the Internet, thereby improving the economics of the transaction experience of collectibles, rather than only cheap game items.

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Three key points worth paying attention to in the future MagicSwap V2

1. With the arrival of MagicSwap V2 and the continued rise of the Treasure ecosystem, there are three things to watch in this space over the next few months:

2. Treasure’s native token MAGIC——MAGIC is the governance and fee token of Treasure and MagicSwap. It is also one of the most traded tokens on Arbitrum. As the focus of the early Arbitrum game field, it deserves special attention this year.

3. MagicSwap's first gaming experiment - MagicSwap with NFT-to-NFT pools and other customization options will pave the way for more complex and technology-based Web3 game economies, enabling richer gameplay.