Last time we outlined the different types of NFT game types employed by most of the games we see in the market. As a quick review, NFTs provide the ability for game designers to add a different incentive dimension for players, allowing them to get more engaged in the games by adding a meta-game element. Not only are assets used for in-game play, but they can additionally be traded outside the game, potentially generating income for the player, so that the game has the potential to add value to the player in a monetary way[1].

The three general game types are: skill-based games, collection-based games, and grind-based games. Generally, most computer games include a combination of these three elements, but it is a stark notable observation that NFT games focus much more heavily on the latter two models due to the nature of NFT secondary markets being a big part of the reason why players engage in the first place—balancing the buyers (who play by collecting) and the sellers (who play by grinding) of the NFTs.

In my opinion this leaves the games feeling ‘hollow,’ as it removes genuine competition from the games, leaving it more of a simple chore, or function of who is willing to spend more money, or more time. An example of a well-balanced model has been the massive success of Pokemon Go where the training and collection of Pokemon was balanced by the fact that the actual game of battling the Pokemon against other players was skill based, much like a real-time version of a Final Fantasy type of turn-based attack games. What Pokemon lacked though, was an open market for trading Pokemon, instead allowing only limited number of exchanges, and importantly trades must be done through the game itself, as the Pokemon had no existence outside of the game. This was a conscious decision so that the game did not devolve into a meta-game of collecting and hoarding.

This is where NFTs stand to change the game. They allow assets to have persistence outside of the game platform, and indeed the ownership of game assets is not entirely in the control of the game platform itself. This has both pros and cons, as with the advantage of being able to foster a huge secondary market for game assets comes the downside of having to carefully monitor the NFT trades, to ensure that players are not using the NFTs just as a method of real-world money laundering. Not doing so will likely land the game company in hot water, as the AML laws globally generally frown upon providers of services which help facilitate the hiding of the proceeds of crime. But the issue of having a massive secondary market for game assets as NFTs out of the control of the game developers themselves has other negative issues besides legal ones, namely that it hugely complicates the in-game economy and game balance.

Designing a good game is hard work, and different games have many different kinds of challenges to overcome in order to make the game appealing to all players, young and old, newbies or experts. The one aspect that all game designers have to tackle, is the issue of game balance. This essentially can be thought of summarized as the aggregate ‘fairness’ of the game. With multi-player games, this balancing is made more difficult by the fact that there is no set story arc that can be controlled by the game designers, and the game must appeal to the entire spectrum of player skill and experience levels, entering and leaving the game at any time. Beginners to the game should not feel overwhelmed and overpowered by their opponents to the point where they can’t progress meaningfully in the game, while veterans who have put in hundreds of hours into the game need to be kept challenged without getting bored.

Real world sports have the same issue, which is largely solved by separating players into categories, ‘weight classes’ or leagues, so that players compete against those in or around their own skill level or capabilities. Golf and other multiplayer PvE (player vs environment) games use some sort of handicap system so that different players can still compare their personal relative results against their competition. Some real-time strategy (RTS) games like Starcraft depend on meticulous play balancing to ensure that the different ‘templates[2]’ (player types) in the game have more or less equal chances to win given an equivalently skilled player[3]. It is plain to see that the introduction of a secondary market of game items could disturb this balance, by way of allowing players to ‘buy their way to victory.’ For example, a beginner player could simply pay someone who has ground up a high-level character or game item, and be able to immediately overpower the opponents in their current experience level, or otherwise engage in ‘grieving[4]’ other players. A real-world analogy would be if an athlete where to use performance enhancing drugs to seek an advantage over their competitors.  It’s just plain cheating.

So how can an NFT game have an out-game economy of assets without players perceiving themselves as being cheated? After all, nobody wants to play a game where cheating is allowed for very long. One way is to factor the outside economy into the play balancing equation. Namely, have ranks and classes which are based on what a player owns, not just what they have achieved in the game. 

If a player buys and brings a Vorpel sword +7 into a battle, then they are ranked as a level 10 fighter, even though they may just be level 2 without it equipped. The other method to remove the deleterious effects of NFT markets, is to remove the ‘competition’ from the game. After all, if there is no PvP (Player vs Player) competition as the main goal of the game, or if losing PvP doesn’t have any negative effects, then players don’t mind getting owned by someone with better gear that they bought outside the game. Examples of games that follow this model are Roblox and Minecraft which have sandbox open-ended[5] game play which focus more on exploration, building and creativity than competition, thus allowing easy integration with outside NFT asset markets. Indeed, of the two Roblox already has a well-developed in-platform game currency, robux, which players can buy with real money and use within the platform to gain locked features and experiences within the game. Of all the MMO games, Roblox is the only one [6]which has successfully integrated into an outside economy for in-game items, although it does not utilize any blockchain technology.

Unfortunately, most of the NFT games at present either do very poorly at addressing the destabilizing effects of an outside token economy on their game, or they ignore it completely, electing to just focus on the collection vs grind model, and let the speculation hype of the NFT secondary market returns drive the engagement in the game, rather than the game itself. It’s hard to argue about the latter, after all, if funds can be raised and salaries and bonuses can be paid with a token launch before the game is even developed, then it is easy to think that the issues of game balance can be solved later on, kicked down the road like other real world economic problems. Though it is my opinion that it is exactly these sorts of fundamental flaws of game economy and player incentive that if not setup correctly from the beginning will eventually spell the end of the game. NFT game developers should look to traditional MMO models that work, without a token and asset secondary market before they go off and make a thin game facade wrapped around an economic model[7] that in the long run, holds as much interest as every-other-penny-stock in the pink sheets of Wall Street.

Next time, we will explore how to structure a P2E (Play to Earn) game successfully without it damaging the economic model of the game.



[1] One could argue then it ceases to be a game, and more of a ‘job’

[2] In Starcraft and Warcraft, these are represented as different races that a player can control, which dictate the strategy that they employ in the battles.

[3] Though these sorts of things are notoriously hard to measure objectively, as players inevitably gravitate and specialize on one race and naturally do better using the race that they are more experienced with.

[4] To Grief – gamer lingo for making newbies to the game angry, cry or just rage quit the game.

[5] Without any defined goal or objective

[6] There are some others like EVE Online, though I don’t consider their integration with the outside economy as comprehensive as Roblox, simply because Roblox is the only one that allows in-game currency to be ‘cashed out’.

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