This is collaborative content from Aliaksandr SheliutsinCo-founder of the GameFi project ZombieTrain.
What is GameFi?
GameFi is a special combination of two worlds: gaming and finance. It combines entertainment with financial rewards in a very new way. Gone are the days when players simply strived to reach a new level and earn some points or trophies; Players are earning real-life assets, whether in cryptocurrencies, NFTs, or other valuable rewards, in this new digital landscape.
This is a transformative change: what was once the mere unlocking of in-game achievements now unlocks real, tangible benefits off-screen, making time spent playing directly valuable. GameFi became synonymous with paid games and this concept began to grow at an impressive rate. More and more players are flocking to these platforms not only for fun but also to generate wealth through their gaming skills.
GameFi will only become more extraordinary once the technology of both blockchain and cryptocurrency fully matures.
How Telegram games are leading the charge
Telegram, a platform traditionally known for messaging, has now become an unlikely hub for GameFi projects, ushering in a new era of user engagement and entertainment. A growing number of games like Hamster Combat, Catizen, Notcoin, Dogs and Gatto are using Telegram’s huge user base and seamless communication features to create dynamic and engaging GameFi experiences.
Combining addictive gameplay and real-world money-making opportunities, these games have gained enormous appeal. In fact, some of these games have attracted tens of millions of players from around the world.
While playing on Telegram has the social layer of chat that improves games by fostering communities, instant updates, challenges and rewards are possible. It’s not just about playing the game itself; rather, it involves connecting with your fellow players, developing strategies, and, of course, earning tangible rewards along the way. This seamless integration of chat and gaming makes Telegram the perfect home for the growing GameFi movement, with an ecosystem expanding in both user numbers and engagement.
How to distribute rewards?
Reward distribution has always been one of the main challenges at GameFi. Most GameFi projects in the past have been plagued by unsustainable reward systems, similar to Ponzi schemes where rewards can only be paid out as long as there is a continuous new influx of players into the ecosystem. This eventually collapses as player growth slows and the system cannot pay. So the big question is: how do GameFi projects distribute rewards honestly and sustainably in the long term without falling into the trap of unsustainable models?
Script: A committed gamer has spent 8 hours a day playing for 20 days a month. Even with maximum ad revenue and incentives, your reward works out to be $80 a month. While this may be significant in some regions, the actual cost of delivering these ads and incentives to such committed players would actually decrease your overall payout. Even in areas where $80 is meaningful, the ad-based model fails to provide a truly sustainable or rewarding experience for both the player and the platform. This is where innovative approaches to reward distribution come into play.
What are the solutions?
- Player Categorization
Not all players have the same goals or expectations when they enter GameFi. Some are there for fun, while others arise purely out of interest and the lure of the money to be made there. We can normally distinguish two main types of players within the GameFi ecosystem:
- Fun-first gamers are primarily motivated by the fun and excitement they get from playing. While rewards are a welcome added positive, they are far from the core motivation in themselves.
- Those who win are more financially minded when it comes to gaming. They are hardcore gamers who play to win money and like the rewards of their work.
By recognizing these distinctions, GameFi projects can adapt their reward structures to better serve both groups. For example, you can concentrate rewards programs among top earners to incentivize serious players without losing the fun and entertainment values for casual players. This allows for a balance that maintains both high engagement and sustainable growth.
- Controllable payments
Giving players control over when and how to withdraw their rewards can be a powerful tool in stabilizing the in-game economy. This approach would allow the project to apply market pressure to the tokens in circulation. While many systems implement withdrawal thresholds, they often do not address the broader issue of the balance between supply and demand for tokens. What if we took a more controlled and systematic approach to payments?
Instead of allowing constant withdrawals, the project could be done with a monthly or quarterly payment. This would have two immediate advantages:
- Predictable supply: Limiting the frequency of payments would allow the project to manage the supply of tokens more effectively by buying back tokens as needed to maintain price stability.
- Psychological impulse: In fact, players will better appreciate the large lump sum payouts. These can be much more rewarding than many small, frequent payments. Larger payouts can have significant psychological effects, giving the player a feeling of success and satisfaction that keeps them invested.
- Long-term smart tokenomics
The very foundation of any successful GameFi project is sustainable tokenomics. It’s not just about the distribution strategy or how much is allocated to in-game rewards; rather, it is an overall strategy that involves total token supply, purchasing, burning, and governance mechanisms. With a well-structured strategy for token distribution and management, a GameFi project can build a prosperous and long-lasting ecosystem that attracts both loyal players and strategic investors.
Good tokenomics:
- Infinite Axie: A two-token model: While SLP is used to reward internal participants, AXS, for its part, works for governance purposes. Axie Infinity’s play token burning mechanic is really good at balancing supply with demand, so it’s good for the sustainability of the game’s economy.
- Catizen: A very interesting reward structure was achieved that could promote long-term player engagement and value retention through well-thought-out in-game utility and sustainable token distribution.
Bad tokenomics:
hamster fight It is one of those classic examples of the “hit and run” system, whose reward structure is very concentrated at the beginning: it is large and attracts early adopters, but it is not planned to be maintained in the long term. With interest falling, so does the system’s ability to maintain those unsustainably large payments.
While bad token economics can generate a wave of hype and early growth, it often leads to inevitable collapse. A solid tokenomics strategy that incorporates careful planning, sustainability, and balance will ensure long-term success for both developers and players.
- In-game token utility
For a GameFi project to be successful, the game token needs to have real utility. When players can easily convert tokens into real-world value or use them meaningfully within the game, the ecosystem remains strong and balanced. However, tokens that have no real utility or that only serve to increase supply without creating demand are a recipe for failure. Here’s what works and what doesn’t:
Good public services:
- In-game purchases: Token is applied to purchase skins, boosts, upgrades, or other premium content. This creates inherent value for the token and incentivizes players to earn and spend it.
- Participation in events: If there are events that can only be participated in the game with tokens, that can generate excitement and demand.
Advantages of the partnership could be partnering with external brands or services to offer real-world rewards, such as discounts or products, that add value to the token.
Bad public services:
- Gambling Rewards: Gambling increases supply without boosting demand; This is a toxic cycle where the tokens will devalue over time.
- Liquidity funds: Adding more liquidity without creating intrinsic demand simply floods the market with tokens, leading to inflation and devaluation.
- General rule: A utility must add value to the player or ecosystem. If a utility is only inflating supply without creating demand, it should reconsider. A balance will be necessary for sustainability.
Final thoughts
Creating a non-volatile GameFi economy is by no means easy: it must be considered through player motivations, token economics, and reward mechanisms. Creating a lucrative GameFi environment with focused attention on player categorization, payout structure control, intelligent tokenomics, and in-game utility can surely guarantee players an enjoyable yet profitable experience.
GameFi is huge and moves very fast. As the sector matures, the next wave of projects will move beyond the Ponzi models of the past towards genuinely sustainable, enjoyable and profitable ecosystems. Whether fighting in Hamster Combat or strategizing through Catizen, know that the landscape at GameFi is changing rapidly and you are part of this exciting revolution.
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