How Does The Play To Earn Business Model Work?

by Technology 14 November 2022

Play To Earn

Gaming as a company has developed substantially over time, and, like all other industries, the gaming sector is continually introducing new business models. Play to earn games are the most recent addition to the business concepts of the gaming industry. Play-to-earn or p2e, games compensate players primarily for engaging in a game.

It is important to note that play-to-earn gaming is not exclusive to the web3 world, but it has gained popularity through crypto blockchain technology. Blockchain technology for NFTs is available along with the tokens. All have presented as game creators, gamers, and investors with a whole new horizon.

According to DappRadar, the prevalence of play-to-earn gaming is growing even during the crypto winter, when the price of cryptocurrencies has dropped, and a number of important crypto enterprises have declared bankruptcy.

Various Business Models For The Gaming Industry

This post is for you whether you are in a gaming studio and preparing to launch a p2e crypto game with the help of a crypto investor who is interested in learning the p2e gaming model and economics or a hobbyist who enjoys peeking behind the curtain of innovative business models. 

However, first, let’s learn about some of the top play-to-earn blockchain games on the market.

Various Business Models For The Gaming Industry

1. Pay to play

The pay-to-play business strategy demands that the game be purchased before it can be downloaded and played. The most recent business model established in pay-to-play is subscription bundles, such as the Xbox Game Pass, EA Origin Access,  Apple Arcade, PS Now, and UPlay+, which require a set monthly subscription fee to receive access to a selection of games in their subscription bundle.

The game creators have compensated a proportion of the overall membership costs depending on the amount of interaction and interest their game receives relative to other titles.

2. Free To Play

As the name suggests, players of “free-to-play” games aren’t expected to shell out any cash to get their hands on and enjoy these titles. The games may be downloaded and played without cost, but certain in-game content or items may need a fee in order to access them, and developers may monetize their games via in-game advertising.

Free-to-play games account for over 80% of all income in the gaming industry due to their widespread adoption and the success of the business model they use.

At the moment, the free play-to-earn model is used by practically all mobile games and a growing number of PC and console games. Fortnite, Apex Legends, Valorant, PubG, and many more are just a few of the many successful mobile and PC games that operate on a free-to-play basis.

The most recent business model to enter the gaming industry is play-to-earn games, which provide players the chance to earn real-world cash (such as dollars, euros, or bitcoin) in exchange for playing or engaging in-game.

3. Play To Earn

Play-to-earn games are nothing new; there are many of them in the conventional gaming market. However, in the web3 area, a few games like Axie Infinity, Decentraland, Sandbox, and Gods Unchained, etc., are seeing meteoric growth.

4. Play And Earn

Play-and-earn games, which are very similar to play-to-earn games, are an innovative business model in which the primary focus of players is on playing and enjoying the game, with income coming as a result of grinding that takes place within the game itself. Play-to-earn games are very similar to play-and-earn games. 

Play-and-earn games are video games that enable players to have fun while also earning money via the use of effective in-game features and distributed ledger technology (blockchain).

An important statistic for a game:

Retention: It refers to the amount of time a person spends actually playing the game once they have successfully registered and downloaded it.
Engagement: It is the sum of the number of sessions played in a day as well as the overall amount of time spent playing the game by a player.
The Rate Of Conversion: The percentage of players who have spent real money on virtual goods.
The Typical Number Of Users Per Day (DAU). The typical number of participants that participate in the game on a consistent basis.
Revenue On An Average Per Day For Users Who Are Active (ARPDU). The total daily revenue generated by the players in a game is divided by the total number of players.
Permanent player value (LTV). The typical amount of money that can be won over the course of a single player’s career in this game.

How Does The Play-To-Earn Paradigm Of Crypto Gaming Function?

As a result of the convergence of blockchain technology and the play-to-earn business model, a new sector of the gaming industry has emerged: play-to-earn through crypto gaming. In this sector, games create the in-game economy assets, and governance tokens, along with the virtual worlds on blockchain networks like Ethereum, WAX, Solana, etc.

The Digital Assets 2022 Outlook Report by The Block discusses the overarching business model that may be used by game producers when creating a blockchain-based game.

Crypto Gaming Function

Tokens created specifically for use in the game may be exchanged for other game assets in the vast majority of p2e crypto games. Players may buy, sell, and trade these tokens and NFTs with one another either inside the game’s internal marketplace or via third-party NFT markets and exchanges.

Play-for-money games like Axie Infinity, in which players gather and battle monsters called “Axis,” are one such example. This axis may compete in arena battles and breed with another axis. P2E Crypto Game’s native token, Smooth Love Potion (SLP), may be used to purchase food for NFTs, level them up, and trade them on exchanges.

Play to earn Crypto Games’ Advantages For Studios And Game Creators

Tokens and non-fungible tokens (NFTs) might be of assistance to game designers in the process of developing unique and interesting games. 

Game makers may decide to raise money from the people who will really be using their product rather than seeking finance from conventional sources such as stock investors and venture capital corporations. 

As a result of the fact that the participants will own all of these blockchain-based assets, the participants will see them as having a higher degree of trust.

Studios And Game Creators

In addition, the capacity to design open-world economies enables developers to collaborate with one another, which in turn makes it possible to make the game more exciting and engaging for players. 

The selling of a developer’s digital game assets would provide the developer the opportunity to earn a commission that would last for their whole career.

The Player Advantages Of Play To Earn Crypto Games

Despite the fact that business models such as pay-to-play and free-to-play generated a significant amount of revenue for gaming studios and developers, and despite the fact that pay-to-play and free-to-play models were significantly more popular, they did not offer many opportunities for players to make money while playing games.

The conventional gaming ecosystems had a closed-end business model in which users were required to pay for the game or in-game resources, then commit a significant amount of time to grind in order to unlock more advanced levels and earn in-game assets. 

However, players will not be able to transfer, access, or sell these assets after they have completed playing the game or after the game has been terminated for whatever reason. This means that all of the players’ hard work and grinding would have been in vain.

 Play-To-Earn Crypto Games

Play to earn games, more especially crypto games, provide a portion of their worth to their players as well as the game producers. 

When a user participates in a player-to-player (P2P) cryptocurrency game and unlocks every in-game asset, such as avatars, tokens and weapons, virtual land, and other non-fungible tokens (NFTs), the user has the option to either use these assets in the game or earn money by trading them on marketplaces and exchanges.

In addition, in contrast to conventional games, players have complete control of in-game assets. They are able to move these items inside a game’s virtual world and into another world, as well as sell these goods for real money.

Types Of Play To Earn Blockchain Games

Types Of Play-To-Earn Blockchain Games

Here are the names of three easy Play to earn blockchain games.

1. Metaverse Games

A metaverse is a kind of virtual reality in which users may communicate with one another and other players, as well as play, construct, and own their own virtual experiences and make money off of them. 

Decentraland, Alien Worlds, and Sandbox are just a few of the popular Play to earn game titles available in the Metaverse.

2. Trading Cards

The Play-to-earn trading cards obtained via the NFT are digital collectibles that are only available in limited quantities and function in the same manner as traditional trading cards. Their worth is determined by factors such as their scarcity, how useful they are, and who owns them. 

Trading card games are a perfect match for non-fungible tokens (NFTs), which are assets that may be bought and sold but have a finite quantity. Games like Gods Unchained, Sorare, and Splinterlands are among the most popular p2e games available in the metaverse.

3. Role-Playing Games (RPG)

Players in role-playing games take control of in-game characters, each of whom has their own set of attributes, weapons, and abilities. In order to progress through the game and acquire more strength and better weaponry, the players must first perform certain objectives and gain experience. 

RPGs that are built on blockchain technology, as opposed to conventional games, employ non-fungible tokens to produce in-game assets.

There are numerous subgenres of role-playing games, including action-based role-playing games, massively multiplayer online role-playing games (MMORPGs), and others. Axie Infinity and Blankos Block Party are two examples of well-known play-to-earn role-playing games (RPGs).

What Lies Ahead For The Play-To-Earn Cryptocurrency Gaming Industry?

Gaming guilds are one of the new and inventive methods that players may play and learn together that have become possible as a result of the possibility of earning money via participation in gaming.

Because playing some of the most popular blockchain games requires a financial commitment of some kind, crypto game developers and members of the gaming community are forming gaming guilds that take the form of decentralized autonomous organizations (DAOs) in order to provide assistance to new players in the form of onboarding as well as the provision of the necessary in-game assets for new players to be able to play and profit from the game.

Play-To-Earn Cryptocurrency Gaming Industry

Many gaming studios and developers are still hesitant to implement a play to earn business model owing to concerns. These worries include the blockchain being a slow backend for storing purchases and the possibility of their game’s economy, along with other assets being shared with other games. 

It is difficult to implement blockchain technology into games that are already in existence.

Several game development firms, like Ubisoft, have already begun incorporating assets based on blockchain technology into their games. Play to earn video games have a promising future, but in order for them to become a profitable business model over the long term, they will need to meet or exceed the levels of fun and player engagement provided by currently available gaming models.

Wrapping It Up:

Play-to-earn games will, in the same way as free-to-play games and games based on subscriptions, will, in the future, find a place for themselves in the gaming ecosystem and emerge as one of the most prominent business models.


Sumona is a persona, having a colossal interest in writing blogs and other jones of calligraphies. In terms of her professional commitments, she carries out sharing sentient blogs by maintaining top-to-toe SEO aspects. Follow more of her contributions at SmartBusinessDaily and FollowtheFashion

View all posts

Leave a Reply

Your email address will not be published. Required fields are marked *