Are We Gamers?
Are We Gamers?
Recently @beaker007 forwarded me an article about the web-3 gamers, the world I spend a lot of time in. It raises a serious question that I have rarely seen articulated in this lucid way.
Because every time I open a Web3 gaming server, I see the same split. Half the chat is arguing about builds, strategies, and whether the new update fixed the busted meta. The other half? They’re in price chat, sweating the token like it’s a boss fight. Spoiler: the boss isn’t dying, it’s just dumping.
I spend a lot of time at Splinterlands discord. In a surprisingly similar manner, I see a group of people always talk about game play, while the other group worry about ROI and Tokenomics. In fact in case of Splinterlands, the intelligent ROI discussion now is far less, it is mostly a discussion on price most of the time. To be more specific, a doom-and-gloom discussion on price on SPS and other in-game tokens.
The key element of the web-3 game is the 'money' part. I think that is what makes it different from web-2 games (where you spend money for fun and get nothing of tangible value in return) and it's the same element that typically cause its demise. I think we can say that the web-3 games are now a bit matured compared to 2018. I have plotted below the number of web-3 games launched each year since 2018 and also the number of games that closed shop. Do you see the skyrocketing trend since 2024? I have added more major crypto events that I left relevant in a table below the plot for some additional context.
| Year | Event | Date Range | Description |
|---|---|---|---|
| 2020 | Covid Lockdown | Mar–Dec 2020 | Global pandemic lockdowns impacting economies |
| 2020 | DeFi Summer | Jun–Sep 2020 | Surge in decentralized finance protocols |
| 2021 | NFT Boom | Feb–Nov 2021 | Massive adoption and hype around NFTs |
| 2022 | Terra/Luna Crash | May 2022 | Collapse of Terra ecosystem causing market panic |
| 2022 | FTX Collapse | Nov 2022 | Major crypto exchange failure |
| 2024 | BTC ATH | Mar–Apr 2024 | Bitcoin reaches all-time high price |
I am going to argue that lockdown due to Covid-19 was the primary trigger for the web-3 games. I am also going to take Philippines as a case study and ideal population to showcase the growth of p2e model.
Lockdowns and Economic Shock
April 2020 unemployment spiked to 17.6% in the Philippines during strict Covid lockdowns.
Traditional job opportunities were severely limited, creating demand for alternative income sources.
Digital Infrastructure
Internet penetration rose from 67% in 2020 to 76% in 2022, enabling access to online platforms.
By 2025, penetration reached 83.8%, making digital participation nearly universal.
Play-to-Earn Adoption
In 2022, 25% of Filipino internet users engaged in P2E gaming, with Axie Infinity leading the trend.
Filipinos represented 40% of Axie Infinity’s global user base at its peak.
By 2025, 2.8 million Filipinos were active in the P2E ecosystem.
What is the Problem?
The problem with Web-3 games are multi-faceted.
- Difference in mindset between gamers and degens
- Play-2-earn model fundamentally promises a payment for gamer's time, but does not have a financial model
- Where is money going to come from?
- Without a financial source of revenue (both for the team, and the players), team resorts to token sale first
- After the token sale is over, if the game still is alive, then it is a product sale
- Both models require new players to purchase items or tokens to fund the program
- That by definition becomes a Pyramid scheme
What is the Solution?
This is a loaded question, and I am going to argue that no one knows the answer to this question for Web-3 games. I will share another article that discuss this point. Yet, I think I must list the solutions that do not work:
We’ve tried everything: bigger drops, louder memes, more quests, yet nothing sticks. Clicks come, connection doesn't. Maybe Web3 doesn’t need better marketing. Maybe it needs a reason to be remembered
The following items do not work to popularize a web-3 game, or to make the project successful
- Marketing: Yes, Marketing for an web-3 play-2-game doesn't work
- Giveaways and airdrop doesn't work
- Meme coins and telegram/X campaigns are worthless
- A coin with a De-fi farming attached to it, is worthless
- You can't create value out of thin air
Yet, you can create a game out of thin air. We have done it. Splinterlands is one. Also you can create a community out of the game, which is willing to spend millions of dollars on a game. Again we have done so at Splinterlands.
What we must think about is that Nintendo didn't hire YouTube influencers to popularize Pokemon, or Niantic didn't hire twitch streamers to popularize Pokemon Go. They were just engaging game. Those games were memorable.
Similarly, millions of people put money in the savings account for a small APR. No marketing campaign is required for that. Only two reasons that works:
- People "think" the bank will remain in business, and if not, their money is insured by the government
- Perhaps from my tone, you can appreciate that none of these assumptions are 100% true
- Yet, they are mostly true, under most normal cases
- The currency that they put in the bank, typically hold value, unlike a de-fi token, that perpetually decline since its launch
- Again, the currency holding value is not always true, but it is mostly true for most stable countries
Potential Solution
So, we have a rather daunting task for a web-3 game; that it must be as engaging as Pokemon or Mario Karts and also certain part of the game must act as a bank or a savings account. I think as an ecosystem we can offer both. We can offer HBD as an alternative to a savings account. Or a player can earn in game token that they can possibly convert to stable coin and hold that. They also have a reason to hold in-game assets, cards, that will propel their game play forward to higher level. They must always see, these are the cards they have, and these cards are that much better compared to the other guy who doesn't have them! We must built an engaging game that people like to play like Splinterlands. Thankfully we already have a die-hard community, albeit small, but definitely here for the long term.
The money comes from...
If you can bump the price to assets people will naturally come and invest lol we saw that clearly in 2021
Please list the web-3 games that earn "profits" :)
Swap fees goes to the DAO in SL case. No other games that I know has swaps.
Yes, many web-3 games does have sponsors and VC. But how many stays long term?
wasn't saying a web3 game in particular but in general the gaming space they have to make money to pay for things including stock holders so there's really no reason that can't be happening in web3 gaming
Web-3 games are all we are discussing here. None are remotely profitable. Period:)
Not to mention they don’t have a valid business model. Not yet anyways.
Have you heard of chicken and egg theory? :)
I haven't had the time to play Splinterlands recently but I consider it a 100% game, and a fun one.
If feels significantly different and like a fully developed game, particularly compared to the Game-Fi projects that were all the rage back in 2021.
It is a full fledged game indeed. Just not profitable yet.
When I was a child. I used to play in computer shops and spent around $200 dollars and wasted some of my growing years. I did not get any in return. Now I have spent around $100 in Splinterlands and my money is just where I left them. I will put in more when I get my bonus. Vonak!
No, you got something in return for that $200. You got entertainment out of it.
No wonder I'm not in Discord a lot, I like to discuss both game-play as well as ROI and numbers...
I always wondered what the end-game would be. I get the fly-wheel-thing more or less now, but always wonder where the business is in that. To finance the earning-part, the business has to make money. The higher the SPS token goes, the more it has to buy, the more it has to sell. Which is more or less like every company, just that dividends are paid out immediately. All profits are returned to stakeholders within a short period of time, as soon as all SPS are distributed and have to be bought to uphold the play2earn.
I still don't have a clear idea, as you probably noticed :-D So, I mainly see it as a game/hobby. HBD on the other side is a lot more interesting as an investment. I still have much to learn about how it works, and why it's save, but until now it's promising.
Its complicated, especially the gaming part. As of now there is no sustainable profit model that I can see for the game.
The best we can think of is finance the old players with the new players. That is effectively a pyramid scheme, without any bad intention. That is because the company doesn't make any money from the pyramid.
Well, a lot is also the old players financing themselves, when I see the spending of some whales in pre-sale and later on. I don't think that new players spend that much. Also, I'm pretty sure that at least some of them do that for the game, not for the profit - at least I wasn't able to calculate a profitable way of spending that much for the moment. In the long term, maybe, with SPS increasing in value. So, ideally it would be the OGs staying on board because the game is still awesome, and new people coming in. Then it wouldn't be that much of a pyramid. More like vortex maybe?
This is today.
https://peakmonsters.com/@azircon/history
Exactly.
Read the two articles I linked. They are simple to read and very good.
I did. Especially the second one caught my eye, considering our comment exchange here. The "building for joy" is a business model that unfortunately is not as common as it used to be. Sure, everyone has to make a living, but from my own experience - you can do both. And maybe that is the case for Splinterlands, why it's lasting so long. Those who work with and for it or invest are there for the fun, not the ROI.
The game is created with a lot of love, and the play2earn is not the focus - on the contrary, I remember the first discussion I read through, which was about removing vouchers. What other web3-game has the guts to take away something free for the community in order to secure long term value? Same goes for the conflict airdrops - I doubt that other game leaders have the guts to say "Well, we screwed up communication on that one, we're sorry, but for the sake of the game economy, we have to do these changes. We'll do better next time."
The marketing is as hard as it is with HIVE. I tried hard to get people on for the social media part, but it's kind of impossible - it's a lot easier using the beneficial argument, let it be the payment for content, or the cashback from distriator. Without that? Nobody cares. People complain about FB, IG and such, but aren't willing to do something else without any commercial incentive. But then again, there's the good part - those who are really interested will do the effort and probably be a positive addition to the HIVE. Basically a self-selecting process.
Regarding hive, I told you about the money. Without money you can't get people. But where you are physically, the money part should be a pro not con
I know, I know. Just goes against what I would wish for. I'm too much of a dreamer, against all experience.
You hive account is worth $1000, how much is the average monthly salary there? You made that with writing
Minimum salary is $470, average is a lot lower, depending on where you're looking. In rural areas, 70% make 90$ or less per month. So, yes, the argument is valid - but my mentor here always told me that it's about quality, not making money. And if I use that argument, many will come for extraction, and I don't want that, either. I'm still on the fence about how to do things. For now, it's onboarding through HBD/Distriator, and then I'll introduce people to PeakD - also, waiting for Snapie to be listed on Google Playstore. That will be a very easy instrument to get people into the content creation. First HBD, then Snapie, than PeakD/3speak. Something like that.
It is a balance. I know a Venezuelan couple here for a long time and they struggle to keep it together financially. Yet they have an excellent KE. So I asked them how do you guys do it. If I had to put food on the table for my kids I will sell, yet you don’t! How?
They said, this is our rainy day fund. This is the only rainy day fund that we have. If we lose this we have nothing!
Now THAT is a great argument. I can totally spin that into something useful for my attempts. Thanks for sharing that story!
You are welcome!
you need to count in the lifecycle factor. Everything has its lifecycle. If we talk about Pokemon, I believe you know better than me about Pokemon and it is not about one game. There are many series and franchise about Pokemen from year to years, even they have many spin-off version.
Same goes for Mario Karts, Zelda, Streetfighter, Dragon Quest, Final Fantasy and every other games.. every years they change and evolve, they release the new one, the game play is changed, new experience introduced, and etc etc, but that is not happening in Blockchain games. I do not know how, people just releasing one kind of game in Blockchain, and expect for years people will stick on it and not getting bored.
You are absolutely correct about lifecycle. In crypto we are so poor that just launching a new set of card is an effort! Launching a new version of the game each year is so far fetched that it is not even a thought process!
Tokenomics have ruined gaming, that's also why I'm abandoning the world of web3 gaming, I'm a gamer first and foremost and I'm very disappointed by what happened
I can't blame you. We are not ready, we were never ready.
Game first, then community.
That’s the gamer in me speaking, lasting engagement always starts with gameplay that feels rewarding on its own.
Games in Web3, though, the economics often becomes the product because of how the projects are structured and funded. That’s understandable, but risky, when the token becomes the main attraction, the “game” part gets overshadowed.
The real challenge, as you said, is alignment. When gameplay, economy, and marketing all reinforce each other, the result is sustainable. Marketing alone can’t fix weak design, but it can amplify a well-aligned vision getting it to a broader audience.
So three things! Game, economy and marketing, a balance between the three! That seems far fetched at this point
True, it might be far-fetched at the moment. Balancing is hard and constant acting, the team is definitely working on it with all the changes we’re seeing lately.
I was thinking more about finding balance between the game, community, and economy. Marketing, to me, is more of a tool to leverage or amplify those pillars once they’re aligned.
Or are you thinking of more things that are tight to success of a game?
I was mostly thinking about success of the web-3 games as an industry in general. Not specifically Splinterlands. We have a strong knit but small community and that is why we survived this long, while many other games, even in the hive ecosystem died. Some slow, some fast.
So Splinterlands in particular is okay with the community. We don't have the game and economy part optimized. Also our marketing is non-existent.
By the way, farfetch'd is a Pokemon. Asian regional exclusive :)
That one i definitely did not know... never played Pokemon.
Probably also to addictive!
Both the articles you linked are fascinating. I like the writing style and they bring up many valid points.
Logically, I believe that some version of Web3 gaming "play to own" or "play to earn" should be the future. How does the industry get there? That we still haven't figured out.
When I first joined Splinterlands, I figured the company had, or would have, plans to earn income through outside sources such as ad revenue, sponsorships, partnerships, etc, to supplement income from product sales.
If we can borrow ideas from Fortnite and other free-to-play models, I think we have the chance to succeed. We're starting to see some of that with the new skins released.
To answer the title question, I consider myself a gamer first. Tokenomics is secondary for me, but it adds a nice extra dimension beyond traditional gaming. I view the tokenomics as a game within a game, but secondary for me.
We need monetary backing from large investors. Amazon didn’t make any money for 10 years. But they had a product and they have the investors.
That’s what web 3 needs
Hopefully, investors who want to stay in the ecosystem and will also provide advice and guidance to the team and community.
I was talking about investors like blackrock, or Mark Cuban etc
I figured that's what you meant. I was thinking the same, Cuban or another shark tank type investor to stay and give advice. A group from from Sand Hill Road like A16Z would be great.
An uncomfortable but necessary truth: too many Web3 projects are looking for the magic token formula instead of creating a game that people really want to play.
In my opinion, Splinterlands still has potential because it has a small but solid community of passionate players and has structured and fun gameplay at its core, but the main goal should be to improve the fun... in this context, there should be no private bots....
Well this bot controversy we had for a long time. I want them gone too. However, people on the other side of the argument will always raise the following issues:
I remember, and I know you don't think positively about private bots either, and I'm glad we agree.
Regarding the reasons why private bots would be useful:
When real players constantly find themselves playing against private automated accounts, the sense of competition and satisfaction is completely lost.
The use of private bots, especially if they are as efficient as on Splinterlands, turns a good game (Splinterlands is a good game) into an idle game... how long do idle games generally last and how much are their tokens worth after a short time?
For a long time, when I talked about Splinterlands to promote it, I always got the same response: “But only bots play on Splinterlands!”
How useful were bots in promoting the game?
Only the new Survival Mode will partially solve this problem. Personally, I'm glad there will be brackets reserved for human players only.
Liquidity bots are already a better solution: they solve the problem without compromising the gaming experience and sense of competition for human players, who are the pillars of any game, whether web2 or web3.
Perhaps the right equilibrium would be to separate human leagues and bot leagues, but in my humble opinion:
if there is a game mode, it should necessarily be for humans only, and optionally there could be an additional mode for bots as well.
The current situation, where the Wild format is effectively “bot-friendly,” is counterproductive for Splinterlands in my view.
I love Splinterlands and enjoy playing manually, and I have never taken anything I have earned on Splinterlands outside of Splinterlands because I have always reinvested it in the game.
I am happy that in 2025 many steps have been taken in the right direction (Frontier Mode and new brackets in Survival mode), but the human player should always be at the center, and at the moment on Splinterlands this is not yet the case, but I hope it will be soon.
It's really interesting. I can think of the game Hashkings I invested quite a bit as the CEO was promising to know a lot about economics and how a web3 game should work. In the end it didn't work because I can see now their mechanics were to offer new and new and new and new assets, new in-game things, new NFTs to buy and obviously, as you say, that sounds like a ponzi scheme because if there's no new people or new things where you spend money on, then they don't have the money to keep up with the work, the pay developers, to keep the value of the token high. Anyway, he was always making fun of the way Rising Star game was working with the economics and it's funny how Rising Star is still up and going and Hashkings is not. The only thing is Rising Star has made some measures to keep the game going and to keep the economics going and it went down quite a lot, the StarBits, but it's still hanging there. The thing is they are waiting for Bull Run to come, for it to come back up again. So are the games always depending on the market? And I think yes, because that's what happens to coins and tokens. They depend on the market. So it's not an easy task to have a web3 game and keep it alive.
No bull run can fix the economy of the game. If the players are poor, and players the game as farming opportunity, it is guaranteed to fail, only matter of time.
My son is a real gamer. I got him into Splinterlands and he played for about a year, but then he quit and left everything in his account.
He went on to play a game called whiteout survival. He spends hundreds of dollars on it per month just to have fun. He is exactly the type of player that we need in Splinterlands, but he is not interested to play it :(
That is one of the problems we are facing. We have one game. Many people may not like a trading card game. Yet, we don't have the financial means to develop or support another game.
I've been talking to Blaze a bit on a different platform about Splinterlands and where it is heading and how I have been feeling about it lately. It's made me feel a bit better about where the game is heading. A little :)
I am a big supporter of the game and the ecosystem, yet, I don't wear rose colored glasses that Blaze does :) I will keep the enthusiasm at check. Let us cross the bridge when we get to it.
I'm kind of the same way, so it's nice to see someone who is still hyped about it, because most of the people I talk to are quite disillusioned about it.