6 biggest challenges in launching a web3 game as a free-to-play developer

Mar 12, 2022

Introduction

Many teams are beginning to see the potential of web3 and have begun entering into the space. Ideas are being formed. Teams are coming together. Funding rounds are being closed.

There is no doubt that we’re going to see great things come to light, but the industry is still new and some teams may be missing expertise in areas like web 3 & tokens.

Below I will share a high level overview on some of the key challenges in launching a web 3 game if your team comes from a traditional gaming background.

#1. Have a compelling ‘why NFTs’

Why do you need blockchain? What ‘problem’ does it solve? This is an interesting question that should be understood and answered at a very fundamental level. It’s also one of the primary counter arguments to NFTs.

A less asked question which I think is equally important is what new systems or models can blockchain technology enable which makes the game better? Ultimately blockchain is a tool, so how should games best use it?

Some ideas for things that can be done to answer this question include:

Learn and get feedback from people who are deep in the space who may not have ‘entrenched’ views on how games should work.
Doing analysis on what other NFT games do - who plays? why do they play? how do they do distribution? community management?

For more thoughts on the different ‘levels’ of innovation that NFTs can bring see this article.

#2. Master the capability to do open economy design

A majority of games today are designed with closed economies in mind. The way they play, monetise and retain players is based on a fundamental “law” that players cannot trade. Once you introduce tradable NFTs or tokens, this law gets broken, and so do existing game design models.

Figuring out open economy game design requires an analysis of the past (e.g. MMOs in the 2000s which had illegal real-world trading), as well as innovation into the future.

Open economy game design is a rare skillset which is likely challenging for many existing game designers as it requires them to throw away strongly held assumptions.

Some challenging questions include:

Is it OK for someone to buy any item in the game? Does this ruin their gaming experience or the experience for others, just like in the Diablo 3 RMAH?
How do you want your players factoring in the financial value of assets into their gameplay? Does this make the game more fun or stressful?
What behaviours does your system incentivise? How do you stop it from being over-run by bots or ‘gold farms’?
How would you make the game economy sustainable (prices & earning) if you had zero new player growth?

#3. Think and win outside the game

We are used to the game being the product. Building a great mobile game means focusing on the in-app experience. However, the addition of NFTs and blockchain actually forces developers to focus on areas outside of the game. Things that aren’t usually very important all of a sudden could become a key differentiator that makes the game successful.

The ‘product’ is no longer just the game, but includes your website, your community, your token, your marketplace, your ‘tools’, and much more. This opens up significant opportunity for innovation and must not be overlooked.

How can you create an amazing out-of-game experience that supplements or even exceeds your in-game experience?

#3. Understand token design and operations

Tokens are an incredibly attractive tool that can be used in NFT games. There are many benefits to tokens, with the primary being that they are a coordinating mechanism that enables the alignment of incentives with all participants.

However, tokens are also complex to understand and implement.

First, there is the design of the tokens themselves. Will there be a fixed supply? Will the supply fluctuate? How are tokens introduced or removed from the economy? What are they used for and why would users want them?

Secondly, there is the financial and investment side of tokens. Right now a majority of token interactions don’t happen from actual users, but from other participants in this ‘financial’ ecosystem. Games need to be able to manage their token treasury, understand how to work with exchanges, what a market maker does, the difference between a DEX and a CEX, what staking and liquidity mining is, and even more.

Third, tokens are operationally difficult to use. Assuming your game is successful and you have $1 billion worth of tokens. How do you store these securely? Who in your company has access to them? How do you enable them to be programmatically deployed in your game or empower your team to use them as rewards? Not too easy.

Finally, there is a lot of legal complexity behind implementing a token. Many things may limit the design of the token, what you are ‘allowed’ to do to it, or even simply what you can say.

#4. Building a community as a partner and stakeholder

A big difference between a free-to-play game and a NFT game is that the community in a NFT game typically own assets - either NFTs or tokens. This means that they are effectively ‘shareholders’ or part owners of the game. Often before the game is even out. Because of the fact community members are so invested, not just financially but also emotionally, the importance of community building becomes more important in NFT games.

In addition to the importance of community management, there is also a massive opportunity for NFT games in rewarding and empowering their community. Typically in free-to-play games, communities have limited incentive to actually do things. Content creators, streamers, developers and other community members are usually not able to make a living from a game, and instead rely on things like ads to monetise. NFTs and web3 provides an opportunity for games to flip this model on its head.

How can a game create a win-win-win scenario with all community members, such that everyone in the community is incentivised to contribute to the success of the game?

#5. Picking the right blockchain solution

Developers have a difficult choice to make in terms of the technology that they choose to use. Not all blockchains are equal, and it’s important to understand the difference between blockchains (Ethereum, Bitcoin), between side chains (Polygon, Ronin) and between layer 2 scaling solutions (Immutable X, Arbitrum).

Picking the ‘wrong’ one can be very costly or could kill your game.

At it’s core, the choice of a blockchain technology is a trade-off between security, decentralisation and scalability (the trilemma of blockchain). Teams must ask themselves which of these are most important for them, as the nature of blockchain means it’s impossible to have all three.

Evolution of Web3 Gaming

Discussion about this post