The video games industry is a lucrative business, with data from Statista showing that its annual revenue is expected to reach $503.1 billion by 2025, up from $396 billion in 2023. 

One of the reasons for this growth is the emergence of a new segment within the video gaming industry known as GameFi, where online games merge with cryptocurrency and decentralized finance to power the concept of “play-to-earn”, where gamers are rewarded for their efforts. 

The rise of GameFi, which is powered by blockchain, promises to fundamentally change the gaming industry, adding monetary incentives into the mix and giving people new reasons to play. 

Play-to-earn games have already gotten a lot of attention thanks to the popularity of Axie Infinity and other first-generation games, such as Splinterlands. But those games are now being surpassed by a new generation of play-to-earn games, which aren’t actually built on the blockchain at all. Rather, they’re regular video games with integrated play-to-earn mechanisms. 

Incentivized Gameplay

For the uninitiated, play-to-earn games are video games built on the blockchain that allow players to earn cryptocurrency by completing missions and challenges, engaging in player-vs-player battles with other human opponents, and by trading and holding in-game items, such as virtual land, skins and weapons. 

The global market for play-to-earn games is forecast to reach $3.6 billion by 2028, up from just $755 million in 2021, growing at a compound annual growth rate of 21.3% over that period. 

Blockchain is the key technology behind play-to-earn games, giving players access to the all-important crypto that serves as the foundation of in-game economies. These cryptocurrencies have value in the real-world and can be traded freely via decentralized marketplaces, meaning players can earn rewards from playing games and exchange them for real money. Besides crypto, non-fungible tokens or NFTs play an important role too, representing individual characters, weapons, skins and virtual land in play-to-earn games. 

The ownership of these in-game assets can be confirmed by anyone, because the underlying blockchain records the full history of every transaction that occurs during the game. It’s what prevents anyone from claiming ownership of an asset that isn’t theirs, meaning legitimate assets are scarce and therefore have value. 

Challenges For Developers

Because play-to-earn games are so intertwined with blockchain, creating one can be a major headache for video games developers that have no experience of working with these decentralized networks. Creating a play-to-earn game involves blockchain integration, the minting of assets such as NFTs and crypto, and also the careful design of the games’ “tokenomics”, or crypto-based economy. 

Poor tokenomics is what led to the downfall of games like Axie Infinity, as its economy became dependent on the influx of new players to support the value of its in-game assets. It was an unsustainable model, labeled by some as a Ponzi economy, and the NFT-based “axies” that once sold for thousands of dollars eventually became almost worthless. 

However, developers looking to integrate play-to-earn mechanics with their games no longer need to burden themselves with the complexities of integrating blockchain and tokenomics, thanks to the rise of play-to-earn infrastructure platforms that abstract these challenges away. 

Universal Play-To-Earn Infrastructure

Tenka has created the first play-to-earn infrastructure platform that’s aimed specifically at mobile games, and it is backed by $10 million in funding from investors such as Yield Guild Games and Animoca Brands.

Tenka is pioneering the idea of bringing Web3 capabilities to traditional, Web2 mobile games. For gamers, it acts as a kind of central hub from which they can create and compete in tournaments with their peers, build communities and try to climb up the various leaderboards in their favorite mobile games. 

With Tenka, fans of mobile games can pay an entry fee to compete in tournaments against multiple players or face off in one-on-one battles, and the winner will earn rewards paid out in either crypto or fiat currency. Unlike other eSports platforms, where players complain of long waiting times to receive their earnings, Tenka ensures players will receive their rewards in minutes, thanks to the speed of blockchain transactions. 

The Tenka platform offers two kinds of cryptocurrency. WINNER is a paper-trading rewards token, while TENKA is the platform’s governance and utility token, earned by players who progress in high-stakes tournaments. The platform also integrates DeFi mechanics, enabling players to “stake” TENKA tokens during tournaments to earn more TENKA rewards. The longer the tournament goes on, the more rewards the player’s can earn. Tenka also creates a new crypto wallet for each player that signs up to its platform, dramatically simplifying the onboarding process for new gamers. 

Incentives For Every Mobile Game 

Tenka is an extremely ambitious project that wants to transform every mobile game into a professional eSport. Although it doesn’t list any specific titles on its website, Tenka’s creators say they can support any game that has competitive elements, so long as there is no pornographic gameplay or content.