YBB Capital: GameFi Economics Exploration

YBB Capital
5 months ago
This article is approximately 4272 words,and reading the entire article takes about 6 minutes
How does GameFis core Fi (economic system) appear in top traditional games?

Original author: YBB Capital Researcher Zeke


Since the decline of the P2E (Play to Earn) model of GameFi, there have been many disagreements about the design of GameFi. The two most mainstream design directions are: 3A-level chain games that take playability as the entry point, or full-chain games that are fair and consistent with the spirit of the Autonomous World. With the recent explosion of the two ecosystems, the chain gaming sector has finally survived the long winter and ushered in the long-lost spring. As one of the most popular sectors at the moment, the discussion around GameFi’s different carriers (from game types to on-chain and off-chain) is one of the main topics in the industry, but what this article is going to discuss is not the superiority or inferiority between the two carriers. , but how does GameFis core Fi (economic system) appear in top traditional games? And where should the two new carriers go?

Definition of GameFi

The early definition of GameFi usually refers to blockchain games that provide economic incentives for players to earn money while playing. Players can usually earn cryptocurrency and NFT rewards by completing tasks, playing against other players, and completing levels, and in-game props are also NFTs unique to players. Since the rise of Axie Infinity, the concepts of GameFi and P2E have quickly become popular, and breeding games of the same type (Farmers World, STEPN, etc.) have also sprung up. However, due to its failed dual-token (governance token and output token) economic model + NFT (pets, farm tools, running shoes and other props that can continuously produce tokens) design, once no one takes over, the entire The output of the game will far exceed the demand side and quickly fall into a death spiral. The life cycle of such games is usually as short as a few weeks or as long as a few months. At that time, the word GameFi was almost synonymous with Ponds. The subsequent mainstream direction was first to improve 3A-level production and playability, hoping to attract Web2 players to join in through high-quality game quality and realize a paid game economy. Big Time and Illuvium, which are now popular, YBB are among the most popular. The two 3A chain games that participated in early investment can be regarded as early representatives of this type of game.

The other direction is full-chain games, which have only become popular this year. Although the history of full-chain games can be traced back to Huntercoin 10 years ago, due to insufficient early technology, the experience of full-chain games is relatively poor, so It has always been an extremely niche type. Nowadays, with the continuous development and improvement of infrastructure facilities such as Rollup and full-chain game engines (MUD, DOJO), the feasibility of this concept has gradually matured, and it has begun to go out of the circle due to the popularity of some core people in the industry. However, the current full-chain Chain games are still in their early days and there are many design problems.

The definition of GameFi has now begun to change into Web3 games (full-chain games) and Web2.5 games (currently mainly 3A-level chain games, of course, most of the past chain games also fell into this category). The main differences between them It depends on the degree and method of using blockchain technology. The specific definitions of the two are as follows.

Full chain game

(The definition is based on the views in Autonomous Worlds. For more details, please refer to our full-chain game article Analysis of the Core of Fully On-Chain Games: MUD Engine and World Engine https://medium.com/ybbcapital /analysis-of-the-core-of-fully-on-chain-games-mud-engine-and-world-engine-80b41d6abb):

  • Data comes from blockchain: Blockchain is not just an auxiliary storage of data, nor is it just data stored in proprietary servers."mirror". All meaningful data is accessible on the blockchain, not just data such as asset ownership. In this way, games can take full advantage of programmable blockchains - transparent data storage and permissionless interoperability;

  • Logic and rules are implemented through smart contracts: for example, in-game battles, not just ownership, are conducted on-chain;

  • The development of the game follows open ecological principles: the game contract and the accessible game client are both open source. Third-party developers can completely redeploy, customize or even fork their own game experience through plug-ins, third-party clients, and interoperable smart contracts. This in turn enables game developers to tap into the creative output of the entire (incentive-aligned) community;

  • Games live forever on-chain: This point is closely related to the above three points, because the litmus test of whether a game is crypto-native is: if the client provided by the core developer disappeared tomorrow, would the game still be playable? The answer is often Yes, if (and only if) the game data storage is permissionless, if the game logic can be executed without permission, if the community can interact with the core smart contract without relying on the interface provided by the core team;

  • Games can interoperate with the things we consider valuable: blockchain provides a native API to the concept of value itself, and digital assets are interoperable by default with other assets we care about. This both reflects and helps enhance the depth and meaning of the game and connects the game world with"reality"The world is connected;

  • Supported game types: Since it is a fully on-chain game, full-chain games are only suitable for game types that do not require a low-latency environment, such as: turn-based RPG, puzzle ACT, simulation, adventure, card, management Class, sandbox class, gambling class;

3A level chain games:

  • Combining traditional games and blockchain technology: Web2.5 games are a transitional form between traditional games (Web2.0) and games entirely based on blockchain (Web3.0). They often combine features of traditional games with some blockchain elements;

  • Partial decentralization characteristics: These games may include decentralized elements, such as using blockchain to manage game assets or player transactions, but other parts of the game such as game logic and operating environment are generally centralized;

  • Higher performance and usability: Compared with full-chain games, Web2.5 games may provide better performance and wider usability because they do not rely entirely on the underlying architecture of the blockchain;

  • Balancing traditional game experience and blockchain advantages: Web2.5 games try to find a balance between the user experience of traditional games and the new features brought by blockchain, such as asset ownership and transparency;

  • Triple-A: Traditionally, triple-A games refer to games with high budgets, high-quality graphics, in-depth storylines, and sophisticated production. These games are usually developed by large gaming companies and provide a top-notch gaming experience. The so-called 3A-level chain games are Web2.5 games that meet this standard;

  • Game type: Because it is an asset-on-chain model, all game types are theoretically supported, and the most mainstream game type currently is MMORPG (Massively Multiplayer Online Role-Playing Game) games. This is also the main type we discuss below.

Token Model Overview

The token models of chain games can be roughly divided into two categories. In addition to the dual-token model mentioned above, chain games actually also have a single-token model (which is also the most commonly used model at present). We combine the two models. Give a brief overview.

Single currency model: This model has only one token, and the economic cycle is completely dependent on this single token. For example, Crypto Zoon, Playvalkyr, Hashland, and Big Time all adopt a single-currency model. This model is essentially similar to traditional gold-mining online games, except that four different models are derived when a single token is introduced.

Four modes of single currency model:

  • Mode A (gold standard entry + coin standard exit): Use USDT, BNB, ETH, etc. to purchase NFT and obtain tokens (TokenA) through games. The entry threshold is fixed, and the income fluctuates with the currency price;

  • Mode B (gold standard entry + gold standard exit): The entry threshold is fixed and the daily income is fixed. This model remains stable when the currency price rises, and the return period remains stable when the currency price falls. When the currency price falls, the gold standard income that players receive every day remains unchanged;

  • C mode (coin-based entry + coin-based exit): Both the entry threshold and income fluctuate with the currency price. This model greatly improves the profits of veteran players when currency prices rise;

  • D mode (coin standard entry + gold standard exit): This mode is currently adopted by almost no projects and is unfriendly to both project parties and players.

Dual-token model: It is divided into a mother currency and a child currency. The mother currency is usually used as a game governance token, and the child currency is used as an in-game economic token. The representative of this model is naturally Axie mentioned above, which introduced the sub-coin SLP to take on the selling pressure of the original single token AXS. Most of the output in the game is based on the output of sub-coins, supplemented by the mother currency.

Dual-token model mode: Most new dual-currency models adopt the currency-standard in and currency-standard out model, such as BinaryX’s mother currency in and sub-coin out; Starsharks’ sub-coin in and sub-coin out. Under this model, the spatial flexibility of model adjustment is strong, and there is no need to achieve eccentric adjustments under the gold standard model. However, the problems with this internal loop model have been briefly described above. Current chain games basically no longer use this model.

Economics in games

Games and the economy seem to be two completely different fields, but in fact there is a close connection between the two. Economics studies choices under conditions of scarcity, and one of the angles from which to explore game motivations is economics. When the game serves as a virtual economic system, players need to maximize their own utility through microeconomic behaviors, while the game itself requires macroeconomic theory to establish a stable economic system and maximize life cycle value.

Economics was originally based on the most primitive trading rules. It can be said that the economy originated from trading. In the same way, for games, even though it is a completely virtual world, as long as the trading market is opened and free buying and selling between players (or between players and NPCs) is allowed, an economic ecology will inevitably be formed. In the past P2E era, there were fewer elements in the game, and its economic ecology was naturally simpler and more fragile (in fact, it basically only provided the basic elements required for mining, raising and selling). But now, with the maturity of 3A chain games, the elements of the game and After the composition becomes complex, the toughness and plasticity of its economic system will be greatly improved, especially for the existing mainstream MMORPG chain games. Although there is also a mainstream objection that the current playability of chain games is not enough to create an economic system like traditional games, I personally believe that these two points are equally important and mutually reinforcing. Because even a highly playable game will still die due to economic collapse (Miracle MU, Legend of Blood, Diablo 3, etc.), but an early average game can continue to iterate with an excellent economic ecology. Let the game become a healthy developing country and then slowly improve the playability.

Therefore, how to build a reasonable economic ecology is still a key issue that most chain games must consider now. The so-called token model is only the most basic framework in the economic model. The macro design of game elements is the next step that needs improvement. From an economic point of view, there is no difference between players playing games in the game world and human beings engaging in social activities in the real world. They are essentially the economic representations and economic laws of the real world mapped into the virtual world. In the game world, when a player enters this virtual world as a game character, he or she will display a variety of microeconomic behaviors: choice, cooperation, gaming, etc. Because players need to behave around the allocation of scarce resources in the game to obtain maximum utility. On the other hand, this artificially constructed game world is also filled with various macroeconomic principles: resource scarcity, commodity demand and supply, monetary system, etc. Because the game itself needs to guide its policy formulation and implementation through macroeconomic phenomena and laws, maintain a healthy economic ecology, and maximize the life cycle value of the game. If 3A-level MMO chain games want to find a goal of learning economic structure from traditional games, then Fantasy Westward Journey, which has a stable game economy for nearly 20 years, is definitely the most classic case.

Fantasy Westward Journey

Fantasy Westward Journey is an online game developed and operated by Chinas NetEase (released on December 18, 2003). This game is based on the classic chapter novel Journey to the West and uses Q-version character design to create a romantic style game atmosphere. The game has more than 250 million registered users and has opened more than 400 paid servers. The characters in the game are divided into three races: fairy, human and demon. Each race contains 6 character styles and 6 different sects to choose from, with a total of 19 sects. Players can level up and earn rewards by completing various tasks, such as challenging the 28 constellations of the Heavenly Palace to win gems and other prizes, or completing division missions to receive double experience and monetary rewards. From the perspective of economic system design, first of all, Fantasy Westward Journey is similar to Type B in the single-token model above, and the overall core mechanism can be divided into three points: reservoir, value anchor, and reserve mechanism.


Developers macroeconomic control mainly focuses on the two major links of delivery and recycling. However, since the main participants in the economic system are players, who exist as both producers and consumers, the economic system cannot be controlled from these two links alone. The internal operating conditions of the system are adjusted, so the fluctuations on the supply side and demand side within the system bring about relative excess.

Relative excess refers to relative excess supply or relative excess demand caused by the imbalance of supply and demand in the short term. The main external manifestation is price changes. In an MMORPG development game like Fantasy Westward Journey, the demand for game currency and props corresponding to all development items is relatively fixed. There are no consumer substitutes to deal with the problem of excess demand, and the intermediate problems caused by oversupply The problem of products not being able to circulate effectively can easily lead to negative experiences for players. This is also a problem that chain games often encounter.

This situation becomes more serious as the demand for high-end increases. Take the high-level weapon appraisal market in the game as an example. Since the production chain of high-level weapons requires a lot of game time, low-level equipment and various materials, As a result, every weapon is expensive.

At the same time, due to the existence of random attributes and the high loss ratio recycling system, if garbage is identified, you will lose everything. The consumers in this market are mainly whale users (commonly known as bosses). Also due to the long production chain and high product value, the relative surplus in this market arises. There is an obvious conflict between the continuous output of laborers and the temporary and large demand of the boss. If the redistribution link is not added, either the players output will have nowhere to go, or the bosss needs cannot be met. Dilemma.

To sum up, in order to deal with such a situation, the game needs a reservoir to hold these temporary excesses. Interestingly, the two major reservoirs in the game come from the system design of the development team and the natural evolution of the economic system itself. That is, the reservoir of game currency is a special bank, and the reservoir of props is a merchant. The special bank system is easy to understand, that is, it is used to absorb and store game coins when there is an excess supply, and to provide and exchange game coins when the market needs supply. At the same time, this system can also limit the total amount of game coins that can be redeemed within a specific time range. Play a stabilizing role in the economic system.

Businessmen are also a type of player who will inevitably exist in games that adopt the free market economic model. It can be said that they are a profession that will inevitably arise when it is profitable. In the economic system of Fantasy Westward Journey, all the profits of merchants are essentially taken from the development team, and the reason why they are allowed to obtain these profits is that they assume the functions of prop reservoir and resource redistribution. , has become an indispensable part of the operation of the economic system.

In theory, merchants who carry more inventory are also allowed to have higher gross profit margins as their inventory costs rise. When we find some merchant categories that seem to be very profitable, we must consider their inventory costs for a comprehensive analysis. It can often be seen that their excess profits are still within a reasonable range.

value anchor

The second big loophole is the risk of monopoly caused by limited short-term system output. That is, the cost and difficulty of monopolizing a certain module in the game are low, and a large number of monopolistic behaviors will lead to a very unhealthy economic ecology, thus affecting the game. experience and gaming revenue.

The solution is also simple, that is, provide an official value anchor. Since the value of in-game props is actually equal to the average point card consumption expected to produce this prop, it can be seen that even if the conditions of different servers are different, the pricing fluctuation range of most props is relatively consistent.

In other words, if there is an official store that sells props at the average expected price, as long as the frequency and total amount of output are controlled, it can increase income while preventing monopoly and stabilizing the economic system. Such attempts were made when Fantasy Westward Journey was born. The simplest examples are 100/piece steamed buns, 3000 yuan/40 stamina bookstores, 500 pieces of flying charms, etc. Through these anchor points, including stamina/vitality Most of the resources have official pricing to follow, thus avoiding the risk of operating monopoly.

The final form of Anchor Point may be the Fantasy Westward Journey Pocket Edition. In the Pocket Edition, you can obtain most of the intermediate products in the production process by consuming point cards. We can also see that these products have a very stable official pricing, like this A system has become an important cornerstone for the economic and ecological stability of Fantasy Westward Journey.

reserve mechanism

Fantasy Westward Journey is ultimately a development game. When the surplus value of all labor can enter the market, it goes against the nature of the game and also brings the risk of too much profit being taken away by the studio. Therefore, the reserve mechanism came into being, which deposits part of the players labor value into the development of character attributes. When the players game output is converted into reserves, the developers income can be considered safe.

At the same time, even if part of the games revenue comes from transaction taxes, it still controls the frequency of circulation. Various types of time locks and transaction restrictions on high-value props are not only to protect player property, but also play a role in controlling the frequency of circulation. . Merits of the Three Realms is a comprehensive system based on this idea, which has created a good foundation for the prosperity of Fantasy Westward Journey in recent years.

There are a lot of professional/semi-professional players in Fantasy Westward Journey. They can earn some income through the game, which has become the main motivation for their games. As a developer, it is difficult to distinguish which are acceptable normal players and which are large-scale cancer studios. It is even more undesirable to block all exits for obtaining cash across the board, so the Three Realms Merit System was created.

The design idea of ​​this system is to introduce a new resource into the resource circulation process during the players game, and by controlling the generation and consumption of this new resource, it encourages normal players to play their daily games while limiting the studios Abnormal gaming behavior. To put it simply, in the players chain of purchasing point cards - playing games - producing props - exchanging cash, actions closer to the right will consume the merits of the three realms, and actions closer to the left will gain merits of the three realms. At the same time, when encouraged, normal In daily gameplay, players invest a small amount of achievements in the three realms (such as reserve funds to catch ghosts and masters). Of course, such investments are also limited daily.


Although the economic system is not the whole story of a game, Fantasy has designed an almost perfect answer based on the content in the game. How to cleverly design mechanisms to maintain account vitality, ensure transaction order, and control the balance of supply and demand so that every participating role in the game world (including the project party itself) can get what they need is something we should learn from. So after talking about the representatives of traditional games, let’s take a look at the current status of chain games.

3A chain travel

Judging from the existing 3A-level chain games, Big Time is actually a game that is constantly improving and moving towards a sustainable economic ecology, although everything seemed very rough in the early version of the game. But it corresponds to the sentence above: Even a highly playable chain game will still die due to economic collapse, but a game with average playability can continue to iterate with an excellent economic ecology. Big Time has revitalized the entire economic model through strict centralized regulation. Although the water tank of skin economics has not yet been realized, the games current profit method is actually very similar to traditional games. Big Times current income methods have three points: The transaction fees, blind boxes, and consumable props (crystals) are sold almost every month. Coupled with the adjustment of various aspects of data, the output tokens can maintain low inflation and achieve a delicate balance between project parties and gold players. While ensuring game revenue, the project side can naturally continue to optimize and adjust and add new content to improve playability and introduce more players with different roles. Perhaps this type of traditional online game will be Web2.5 Game the right way out.

Full chain game

In past articles, we discussed the significance of the development of full-chain game technology to the blockchain from a technical perspective. So let’s think about it from another perspective today, what kind of economic model is suitable for full-chain games? In fact, current full-chain games basically do not have tokens or in-game output tokens. The reasons are mainly from two aspects. First, full-chain games are still in the early stages of development, and it has not even been determined what type of games they are suitable for. . Second, due to the fully on-chain nature of full-chain games, it is difficult for centralization to intervene in regulation. Once a loophole appears in the economic model, the entire game will collapse instantly and be irreversible.

So is it impossible for full-chain games to drive long-term development of games through economic ecology? In fact, it is not the case. Although I don’t have a certain answer, I personally think that full-chain games can try NFT-led economics. For example, the ANOME protocol uses gold standard pledge to mint NFT issuance model, decouples Game and DeFi in the form of Stake to Mint NFT, so that projects can obtain funds to generate continuous income through DeFi, and players can obtain NFT for free and receive dividends. This may become a A new economic model.


In fact, the author is an in-depth console game player, and has always believed that blockchain-modified games or methods like Friend Tech’s light application-empowered games are the best way out for blockchain games. When I first heard the concept of the so-called 3A chain game, my instinctive reaction was to be quite resistant. Because players who are familiar with 3A games should understand that the production cost (600 million-4.2 billion) and cycle (about 3-5 years) of top 3A games are extremely exaggerated. Just one failure can bring a leading game company to the brink of bankruptcy. s project. To realize this kind of project in a bottom-up industry seemed a bit impossible to me at the time. However, the tenacity of Big Time and Illuvium in the bear market and their recent comeback against the wind made me start to reflect on this model. Maybe 3A chain games can find some balance in the economic model to achieve long-term survival, and finally iterate some games that can open the door to Web2. . As for full-chain games, at this stage, they are just as questionable as 3A chain games in the past. But there is a famous saying that goes, He who never wins rarely fails, and he who never climbs seldom falls. Before a new paradigm emerges, it is bound to be accompanied by doubts and failures. This is normal.


1. [Game numerical design] Economic and numerical design:https://zhuanlan.zhihu.com/p/513814730

2. The future path of GameFi chain game economic model:https://www.aixinzhijie.com/article/6792848

3.Designing an Open Game Economy (Part 1):https://mirror.xyz/lordheimdall.eth/XFQsJQO917qO1AEpHKHLODpP5ftNSAtQwzJrhCgXWYo

4. Exploration of ideas on the use of basic economic theories in the design of blockchain economic models:https://mirror.xyz/0x buidlerdao.eth/AmXhGowhPk8K1yTcLy5hLJGzPYvAwgDtieoycfqI7tk

5. Unrealistic macroeconomics of Fantasy Westward Journey:https://zhuanlan.zhihu.com/p/588204383

6. Fantasy Westward Journey’s “ceiling” economic model:https://zhuanlan.zhihu.com/p/589546502

Original article, author:YBB Capital。Reprint/Content Collaboration/For Reporting, Please Contact report@odaily.email;Illegal reprinting must be punished by law.

ODAILY reminds readers to establish correct monetary and investment concepts, rationally view blockchain, and effectively improve risk awareness; We can actively report and report any illegal or criminal clues discovered to relevant departments.

Recommended Reading
Editor’s Picks