This is the English version of the original article about Crypto Game Guilds. The original article in Chinese could be found here.
https://twitter.com/0xwayne_z/status/1465241506277584898
Today, let's talk about the hot topic of GameFi and Game Guild. I will cover the game guilds' modes, characteristics, problems solved compared with the traditional game guilds, and the impact of the game guilds on crypto games and even Web 3.0.
The concept of the game guild itself has existed for at least 20 years. In the beginning, it was an organization/community spontaneously formed by a group of game players. As an internet addict when I was young, I will first try to talk about game guilds' history.
Game guilds in the traditional game industry are always difficult to sustain for a long time. There are many problems. Understanding these problems helps to better understand what the current crypto game guilds will be different or even subversive.
The history introduction below is a bit long. I tried to make it like a story, but of course, it is also ok to skip it directly.
The following historical contents are all from the Internet. There is no official data record with credibility, but there also could be some addups by the original writers. After all, it has been a decade or two. The guilds mentioned below are only introduced with China's game guilds as the background.
The earliest game mode is a MUD (Multi-user dungeon), which is basically in a dialogue way (texts and symbols) for players to interact with. The earliest MUD model in China should be the Laughing off the world (a name of a game) last century, while the earliest MUD game globally was *Colossal Cave Adventure *in 1975.
After the launch of Laughing off the world, China's first game guild, called Crusaders, appeared. At that time, the slogan of the guild was very simple: We will always save you once you are in danger, and we will always help you if you are in fights. Simple slogans quickly united many players. However, due to the limitation of the text interaction pattern, the development of the game itself is not very good. The early game guild is more like a place where a group of game players gathers to communicate with each other.
By 1999, the first game with visual graphs, King of Kings, appeared in China. The Crusaders quickly entered the game and founded the Kingdom of Heaven, an organization in the game. At the same time, it also updated the slightly scrawled slogan with We can't play games for a lifetime, but we can be friends for a lifetime. It was the beginning of the century, under the influence of the popular "gangster" series of movies (Young and Dangerous), guild players were completely attracted by such stories and united to play.
The evolution of the guild is actually the development of games themselves.
After that, with the popularity of The Legend of Mir game, game guilds jumped a higher stage in China. Like the way that how to play the game changed: siege, guild battle, fight against Boss, etc., the guild at this time has a clear division of roles and professions, tactics, and command system.
In another story, a guild called Desperate Dance took part in the one-year public test of the Shadowbane game in China. However, due to the poor management of the agent, the game decided to shut down the Chinese server. As a result, players in Desperate Dance decided to move to the foreign servers. Members of the guild added "CN" after their game ID. And the fun part for them was to fight against players that were not Chinese. The story has been told that they were so strong that it made the Koreans ban the IP address of China to protect their own players.
*World of Warcraft *later made the game guild system to the peak.
You can actually find that the guild is just a community of players. The factors that tie these players to a guild are mostly the needs of cooperation, teamwork, and feelings (communication, resonance).
Fantasy Westward Journey, a game that the post-80s and 90s in China should be very familiar with. The guild is called Gang in this game. The game added a new element, the Gang homeland system, enabling the Gang to have its own attributes. Gang members contribute to the gang through tasks, which can make their Gang grow and improve its attributes, and in turn, reward the Gang members. (Of course, Fantasy Westward Journey is definitely not the first game with a homeland system, but in my game experience, it is a game that develops the gang/guild homeland system very well, so use it as an example.)
If you think about it, the Gang's homeland system, that is, the guild has started to have its own attributes. These attributes (land, level, type of resources produced, function to help players improve ability) essentially allow players to invest resources and time in the guild first and then get rewards from the guild later. Let's try to take the Gands' homelands as NFTs, the process of contributing to the Guild as the process of mining, and the promotion of the guild to the players is imagined as mining rewards. Is there any fundamental difference?
The current games attach great importance to the design of guild homelands, hoping to enhance the bonding between players and keep them in the game. Is this very similar to the crypto game, which uses the design, economic model, and NFT assets to attract players?
Of course, the guild of traditional games will also provide novice tutorials and serve new players.
But now, it seems that the traditional guilds are not as popular as the old times.
Why does the traditional game guild lose its popularity now? Very simple. Since the power is all in the hand of the head of the guild, members are no longer regarded as friends and brothers, but as piglets. As the guild grew stronger, and more people came in, the money could be made from members also increased.
No one will say not to the money, let alone the head of the guild.
The head of the guild is targeted by the game merchants. Game merchants ask heads to ask members in their guild to play merchants' own games, and the money that players paid then was in the pockets of guild heads and game merchants.
At this time, guild members were no longer brothers who fought the enemy together in blood or friends who helped each other. In the eyes of the guild heads, they were "piglets".
The essential reason for this problem is the economic system of the guild, caused by the over-centralization of the organization. Now crypto game guilds have the potential to solve these problems.
I never figured out what to call it, Crypto Game Guild? GameFi Guild? GameDAO of Web3.0 DAO? Maybe the last one is the longest but the most appropriate. Crypto's game guild is essentially a DAO, and most guilds will have their own tokens. This difference releases the potential to solve problems existing in traditional game guilds. We now recall the characteristics of the traditional game guild mentioned before:
Spontaneous community of players, relatively loose organization
Clear job/role division
It's more about fun, emotional communication, and the need for collective shelter
Different guilds fight for fun and a sense of community
The guild head has greater power in the organizational structure, the distribution of benefits is uneven, and the information is not transparent
Compared with these characteristics, crypto game guilds are weaker than traditional game guilds in terms of the attributes of the game itself, which is mainly because the game is less playable. However, the importance of economic benefits is much higher than that of traditional game guilds.
YGG, Yield Game Guild is the most widely known Crypto game guild. I picked three more game guilds, Merit Circle, MetaGame Guild, and GuildFi. These four are roughly representative of what Crypto game guilds have to offer, specifically
Provide teaching services (Crypto games are somewhat different and require knowledge of Crypto basics, such as the use of wallets)
The scholarship program, i.e. renting game NFT assets to early players
Game discovery, early game joining lists, airdrops, etc
Membership ranking system
Other gaming tools, mining, staking, etc.
Governance / Voting
In contrast, Crypto's guilds are more focused on providing early help to players, attracting players to join the guild, providing financial help, and using tokens as a bond to provide financial incentives.
YGG is the first widely known gaming guild that started in the Philippines. The background of its emergence has much to do with the global pandemic of the Coronavirus. The Philippines is a country that relies heavily on labor exports. Due to the blockade brought about by the epidemic, millions of people have lost their jobs and cannot support themselves. The emergence of the Axie Infinity game gave them a new choice. By playing games for a month, the income of tens or hundreds of dollars is enough for many families to meet their basic needs in life.
In the early days, YGG attracted a large number of guild members by helping people to play Axie. Since Crypto games require the purchase of NFT assets before earning, YGG purchased a large amount of NFT assets for games and rented them to players. The revenue earned by players was divided into three parts: players, community managers, and the YGG in a 7:2:1 ratio.
Having grown and expanded, YGG now has four main goals, which are
Invest in the best yield producing NFTs in the Metaverse
Build a global economy of play-to-earn gamers
Produce revenue by operating and renting NFTs
Encourage community participation in the guild
This model was quickly recognized by the market, YGG completed three consecutive financings, investors including Delphi Digital, Blocktower, Animoca Brands, a16z, and so on. Its community Token $YGG is also popular in the market.
YGG has worked with many games and has also purchased a large number of NFT assets of other games. YGG released its asset financial report in September. At that time, the NFT included assets of 14 games worth a total of $17.62m.
For ERC20 assets, there are mainly $YGG, plus $USDC $ETH, and others, which are worth $845m in total.
MetaGame Guild is also a game guild similar to YGG. It mainly focuses on assisting players to play games (scholarship program), and helps players get access to early games. According to information on its official website, the current cooperative games include Gold Fever, Axie Infinity, Placewar, Dark Frontiers, etc.
MetaGame Guild tokens will be released this year and will be deployed on the BSC and Polygon chains.
Merit Circle has a particularly strong investor base compared to other Crypto game guilds: DeFiance, Mechanism, DCG, Spartan, and YGG. Merit Circle, formerly known as the Axie 420 Scholarship Program, aims to help players in low-income countries get started with Axie and earn income by playing games.
After reaching a certain scale, Merit Circle was formally established through the incubation of Flow Ventures. Of course, its goal is not just limited to Axie. At present, the official cooperative games include Star Altas, Illuvium, Hash Rash, Nyan Heroes, etc.
YGG, MetaGame Guild, and Merit Circle mentioned above are actually similar while having differences in terms of community size and games cooperated.
GuildFi, on the other hand, is slightly different. In addition to the aforementioned functions of the guild itself, GuildFi wants to do much more. Using the example of a fund, YGG is a star fund, and the later ones have followed suit and set up funds, while GuildFi wants to be a mother fund (Fund of Funds) in addition to setting up a fund itself. Put in a game guild, it is a Guild of Guilds.
Features of GuildFi include:
GuildFi ID, that is, a Metaverse ID that is embedded with a leveling system that tracks players’ achievement and footprint across the metaverse
Game Discovery, same as other guilds
Proof of Play, which records and analyses user's game playing activities for subsequent rewards
Gaming NFT Launchpad, gaming tools, scholarship portal
GuildFi works with other gaming guilds in addition to games. Compared to other similar features, the more anticipated ones might be the GuiFi ID and Proof of Play. Through a single account to link multiple games/guilds that players participate in together, and then through the mechanism of proof of play to determine the player's points and give rewards.
We have to be clear that whether YGG or other similar guilds will be successful or not, fundamentally depends on the Crypto game itself.
Crypto's games are currently focused on Play-to-Earn. And it seems that many Crypto games are still essentially in the shadow of Ponzi, i.e. they need new players to enter in order to pay for the early players. Making money is basically all the new players want, and keeping the game in a profitable state requires the price of the game's token to keep increasing to keep the cycle going.
It is the reason and feasible method that most games reduce token supply by internal consumption in the game.
Let's recall the guild homeland system mentioned earlier. It is similar to NFT assets in Crypto. The reason why traditional games do not need money-making effects to attract new players is their playability and competitiveness. By satisfying these aspects, it is possible for users to consume time and money to add attributes to the premises (NFT assets) (helping NFT assets to appreciate/become better), and users are willing to pay for the pleasure and sense of accomplishment found in the game.
But in Crypto games, the model is that guilds hoard NFTs and then rent them to users, plus users stake the guild's tokens to get rewards. The only reason left for players to pay for NFT assets is simply making more money. And the financial rewards cannot go on increasing indefinitely; from this point of view, the 'buy and rent' for Crypto guilds' NFT assets is even more fragile than that of the traditional guild’s homeland system. At the core of this is actually the fact that the value evaluation of game NFT assets is too single and not fleshed out enough.
So from this perspective, the design aspect of Crypto games should enhance the playability and the diversity of NFT assets, and the richness of value sources. The playability of a game mainly comes from the unknown and uncertainty. Such as the uncertainty of rewards, the uncertainty of battles, and even "sudden death". Uncertainty is what can bring surprise and excitement, even reluctance, to the players and inspire their interest. This aspect is already beginning to emerge in the Crypto field. Dungeon adventure games are already emerging in Crypto, but none of them are widely known yet. Dungeon adventure games give players uncertainty. For example, through the uncertainty of the map, the player is given the uncertainty of monsters/other players/battles/rewards.
As for the value richness of NFT, limited edition/game stories to give meaning to NFT/special features/even co-branding with other agreements and brands are ways to increase the resonance and attraction of players.
After talking about the bad side, let's talk about the good part.
Again, crypto gaming guilds are essentially DAO organizations and thus can reduce the disadvantages of centralization to a certain extent. While even token voting can be dominated by whale holders, it is much less likely than traditional gaming guilds that treat their members as piglets. Players can vote about how to use guild resources/assets and decide what the next game they want to play.
Moreover, proposals of guilds are completely open, and as long as it is reasonable and beneficial to the guild, they can be easily supported. High-quality guild members will also have a bigger voice in the guild's decision-making.
In addition, unlike traditional game guilds, Crypto game guilds generally have more capital reserves, plus the threshold for developing Crypto games is lower, so guilds are able to invest directly in incubating games. Crypto game guilds to a certain degree improve the situation that the revenue of a game mainly comes from its players. Let the players participate more in the game design, so that the game itself is more balanced, especially in terms of economic interests.
In short, this organizational model and the mechanism of distributing economic benefits can create a fairer and more transparent game and guild/player system with the addition of quality games. So the core of GameFi is not in Fi, but in the game itself. Maybe that's why IMX, which focuses on building game infrastructure, is so hot and can still stand in these two days when the market is especially bad.
I write about crypto randomly and mostly in Chinese with some in English. I am also open to any discussions.
You can find me at wayne@tokeninsight or the Twitter below.
My substack subscription channel