(Youtube video link)

Speakers

• Jeff Tunnell, Founder & President Monster Ideas
  • Created Social City which was a hit in Fb platform days (10M MAUs)
• Josh Williams CEO of Forte
  • They are an infra/tools company helping game developers “bridge” parts of their games to blockchains
  • Raised 150m at 1b valuation in May 2021. Cofounder was Kevin Chou who then did Rally (social tokens co) and seems to have a new co already after
  • Related, at same time: Hong Kong-based Animoca Brands, raised $88 million at $1b, to build blockchain games
  • Traction as of May 2021
    • 10M+ wallets created, 5M+ NFTs minted
    • 10 live games, but also says “25 game developers with more than eight million players are actively using Forte’s technology”
    • 100 employees
  • They say they make money on an AMM they built – providing early liquidity between the games token and common tokens… interesting

What’s new

• “The big promise of blockchains is changing the business models of games, in particular creating better game economies“

1. Allow players to really own the assets in games (assets can be cosmetics, items, land, etc)
   • Transforms from “pure expenditure” to investments
   • Grows the value: if you know that you will own the asset (and can resell it, or maybe even transfer it into another game later) you are more likely to invest more
2. Open provenance / history of every item / asset. You can know the history
   • eg this is the sword that was used on this world record speedrun
3. Richer marketplaces
   • Including royalties at perpetuity (like with NFTs) for asset creators, and the 
   • Instead of today where it’s shady. eg black market for CS skins or WoW accounts
4. Automated incentive systems
   • eg rewarding players who create new content or story etc
   • The game developer starts to operate the game economy with the same pulleys and levers as a government policy – taxes, subsidies, grants, etc

•  Not really mentioned, but also: richer identity
  • Your crypto address can show some history about what you’ve done which can be reused across games
  • Similar to how a lot of “cred” can accrue to a pseudonymous identity like 0xMaki at sushiswap

FAQs

• Why do this on blockchain and not just a database?
  1. Reuse the security model of the blockchains
  2. Will be able to build a bigger economy. People who don’t know you yet will be able to go in because they know the assets are not just tied to this game

Asset transfers

• For most game designs they believe that transferring an asset to another game doesn’t necessarily make sense
  • eg between a car game and an FPS game, not necessarily overlap 
  • but even within the same genre, there is a lot of tuning / balance to be figured out so moving items not as straight forward… both speakers not bullish about that, they care more about the game economy/marketplace points

Increasing decentralisation

• Over time more and more incentives to move the compute associated with the assets to also be happening with less trust/control from the game dev
  • Williams mentions some trustless technologies that are not blockchain-based, but doesn’t expand on them 🤔
  • This is something we are seeing with Sky Mavis slowly giving up control of the Axie community to $AXS holders, see later

Axie Infinity

• Looks like the talk was recorded pre-covid because (1) in person, not a single mask in sight, (2) not a single mention of Axie Infinity, Sorare, etc
• Axie – the NFT-based card battle game – shows a lot of what Williams is talking about
• Players own the assets
  • In this case they are “axies” which are like pokemon cards, and are NFTs on an Eth sidechain called Ronin
• Rich marketplace
  • As of April 2021 Axie has had over $1b in sales. Hit 1M DAU
• Automated Incentive mechanisms
  • “Breeders” who create new axies are rewarded, they can sell them
  • Play to Earn mechanisms: you earn $SPL (an ERC20 token associated with the game) based on your in-game performance. Liquid token you can sell for cash on Dexes
  • Rewards for staking $AXS
• Increasing decentralisation
  • Currently shots are called by Sky Mavis the studio behind the game
  • Governance token $AXS
• Sky Mavis doing fiscal policy:

• See this great writeup from Luca Prosperi on the explosion of the Axie economy, what makes it look like a state, etc
• He also covers new decentralised NFT funds (YGG and Blackpool) which have popped up in Play to Earn games, building war chests of NFTs (Axies, land in Decentraland, players in Sorare, etc) and lending them out to players who typically don’t have the capital to get started (for a share of their yield). Disclosure: I am shamefully talking my book, invested in $BPT and $YGG.

And, yes, I refrained from using the M word throughout this post. Do I get a cookie?