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What are Play to Earn (P2E) Crypto Games?

Video game controller with a stack of crypto coins at the base on a blue background

Blockchain technology has given rise to a new decentralized gaming marketplace, coined GameFi: where online games and decentralized finance (DeFi) merge. The evolution of GameFi is literally a game-changer for how and why we play games. The introduction of a new Play to Earn (P2E) model has flipped the script on the gaming industry. Players no longer just play for the fun of the game or to win, now they can “play to earn”. So, how much can you really make and where do you get started?

This guide will explain what P2E games are, look at some examples of the most popular Play to Earn crypto games, and explain how cryptocurrency and non-fungible tokens (NFTs) power their economies.

What are Play to Earn games?

Play to Earn crypto games are fundamentally blockchain-based games that monetise the gaming experience, by providing financial incentives for players to spend time in the game. The more you play, the more you earn. Rewards are paid in the game’s native token or cryptocurrency, which can be used to purchase in-game items. This can then be used to generate more tokens or be traded amongst other players. The migration of games onto the blockchain and their integration with cryptocurrency has been seamless and somewhat inevitable.

Early online games like World of Warcraft and Second Life, saw the beginning of in-game assets achieving real-world value. Players would work hard to earn the game’s virtual currency and acquire rare in-game items such as weapons, custom skins, and virtual clothing, which could then be sold to other players for real-world money. The problem with these pre-blockchain games however was, if a game shut down, all the assets accrued by a player in that game would be lost.

Blockchain technology allows players to be the exclusive owner of digital assets in the form of NFTs. The tokens and NFTs accrued in the game are owned by the individual players, not the game’s company. These items have real-world value and can appreciate, just like other digital assets such as cryptocurrencies.

Did You Know?

Many people around the world are now playing P2E games as a way to earn extra money. Axie Infinity is by far the most popular example of a P2E game. In developing countries such as The Philippines, some players are able to generate substantial earnings that are often higher than that of the national minimum wage.

How do P2E games work?

GameFi is the hottest new trend emerging from the cryptocurrency space. Play to Earn gaming utilises blockchain technology and is focused on giving players financial rewards for completing game objectives. Mixing free-to-play gaming with crypto, the P2E gaming model combines features of gameplay and integrates them with the financial aspects of DeFi, such as staking, trading, and lending.

The main use for blockchain within the gaming realm is liquidity. Each Play to Earn game has a reserve of native tokens that are held within a smart contract. These funds are awarded to players when they spend time interacting within the game. NFTs represent unique tokens that convey ownership of these digital in-game assets. In most blockchain-based games, NFTs represent the game’s characters, items, and assets. The more you play, the more crypto and NFTs you earn. These crypto-assets can have value depending on their demand. Players can trade these assets for cryptocurrency or fiat currency on NFT marketplaces.

The biggest drawcard of P2E games is the financial incentive they provide to players. Who wouldn’t want to earn money playing video games? This exciting new gaming model based around real asset ownership and a new Play to Earn structure makes it possible for all game enthusiasts to get paid to play. Earning money through playing games is no longer limited to a small number of top professional gamers, but available to everyone.

Interesting Fact

NFTs can appreciate in value and players can make money selling them on secondary markets or trading them within the game. They can even generate passive income through being rented out to other players.

Examples of P2E games

Axie Infinity

Axie Infinity is a popular Play to Earn, NFT-based online game that has generated a huge amount of buzz worldwide. It is the number one decentralized app (dApp) in the Ethereum blockchain ecosystem. Decentralized applications are applications, similar to the ones you use on your phone, yet they operate autonomously.

Axie Infinity is a virtual world Pokémon-style game where players can breed, battle, and trade collectible pet Axies. Players are rewarded the in-game currency Smooth Love Potion (SLP) tokens through game participation, like completing daily quests.

Axie Infinity Shards (AXS) is the game’s governance token and holders can claim rewards through staking, playing the game, and participating in key governance votes. You can buy AXS token on a number of major crypto exchanges like Swyftx.

The earning potential of playing Axie Infinity makes this game unique, however, the barrier to entry is quite high. Axies are expensive and you need three to start with, which costs around $1000 USD. It would take around three months to recover this initial investment. Playing for several hours per day can earn you anywhere from $8 to $40 USD per day, depending on the Axies you own.

The Sandbox

The Sandbox is a virtual world where players can build, own, and monetize their gaming experiences. Originally built on the Ethereum network, The Sandbox is migrating to Polygon’s Layer 2 for faster and cheaper transactions. The blockchain-based online game aims to disrupt traditional games like Minecraft and Roblox.

What sets The Sandbox apart is the level of creativity it encourages. While players can become completely absorbed with The Sandbox world, exploring and hanging out with friends, the main aim of the game is to make unique items you can sell.

The Sandbox provides creators with true ownership of their creations using NFTs. Unlike other crypto or NFT games, players do not earn the game’s native token SAND through playing, but instead through selling their creations on The Sandbox marketplace.

The game’s economy appears to be thriving. Some of the digital assets in The Sandbox have sold for thousands of dollars. Even buying and flipping virtual land and waiting for it to appreciate is a lucrative option. Selling assets within the game is not the only way to acquire SAND, you can also buy and sell the SAND token on crypto exchanges.

Did You Know?

Some virtual land parcels in the Sandbox have sold for millions of dollars. The highest price paid for land in The Sandbox was $4.3 million dollars, bought by digital real estate investment fund Republic Realm. It is the record land sale in the Metaverse thus far.


Illuvium is an open-world fantasy game built on the Ethereum blockchain. In this adventure game, players can earn the game’s token (ILV) by going on quests and accomplishing missions. Players journey across various landscapes to hunt and capture deity-like beasts called Illuvials.

Illuvium is currently in beta, but promises to be hugely popular, with its fantasy gaming world setting, high-quality graphics, and exciting combat elements. The Illuvium game is set to be released sometime in 2022, however, you can already purchase ILV on major exchanges.

How do P2E games tie into the Metaverse?

Games really are the origin from where the Metaverse came. Many gamers already spend most of their free time online inside the virtual worlds of their favourite games. They don’t just go there to play video games, they go to hang out, message and talk to friends, and even attend live concerts all from within the game.

The Metaverse, like P2E games, will exist on the blockchain and be championed by Web 3.0 applications. Cryptocurrency and NFTs will power this new decentralized economy. These common cornerstones are key to enabling interoperability between platforms so that different online worlds can co-exist.

Criticism of the P2E model

Not everyone supports the P2E model, however. Some analysts believe that P2E games are not sustainable, and liken them to a Ponzi scheme, as the health of the platform relies on constantly onboarding new users. For players to keep earning, new money must continuously enter. The challenge for developers will be to design games that are both captivating and profitable. Ideally, players will enjoy the game and be provided with opportunities to make money.

Many in the gaming community have concerns about the monetization of gaming entirely. They just want to enjoy playing games solely for fun and some value them purely as an escape from reality. They do not want their experience to be tarnished by restructuring the focus to be centred around making money.

Important To Remember

Every investment and trading decision involves risk. We recommend you conduct your own research when making an investment decision.

Wrap up

Gamers are the pioneers of the new Play to Earn (P2E) world, providing a real-world use case for blockchain technology and leading the mass adoption of DeFi. The Play to Earn model has attracted both crypto enthusiasts and gamers alike. GameFi is a multi-billion-dollar market and P2E games have become so popular and lucrative they have forced game developers to join the blockchain revolution.

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