Written by: DawnXue
NFTs were undoubtedly the focus of the last cycle. Whether in crypto art, sports collectibles, or in-game assets, NFTs have left a mark of success. However, after PFP projects like CryptoPunks and BAYC experienced glory, NFTs ultimately concluded with the hype surrounding virtual land in the metaverse. Today, these once-hot assets are gradually being forgotten.
The price bubble in the NFT market and the limitations of use value
From historical data on Opensea, blue-chip NFTs like BAYC and Doodles have fallen more than 90% from their peak prices. This phenomenon is not only lamentable but also prompts us to reflect on the crux of the NFT market:
Price bubbles burst. In the last round of market frenzy, NFT prices were significantly inflated. However, as market heat declined, the high prices led to a sharp decrease in new buyers and a significant drop in trading volume. Similar to other speculative markets, NFTs experienced price surges followed by rapid corrections, lacking subsequent narratives or value support, leading to a collapse of investor confidence.
Limited use value. Many NFTs have overly singular functions and exist solely as speculative tools, with very few NFTs having long-term use value. For example, PFP (Profile Picture) NFTs lack more practical uses aside from representing users' social identities; while collectible NFTs have aesthetic value, their appeal and liquidity are difficult to sustain.
Co-creation and revenue sharing of NFTs
The core of Web3 is co-creation and shared revenue. Looking back, the majority of NFT issuances and revenues have been concentrated in the hands of individual creators or platforms:
PFP NFTs: such as Punks and BAYC, their revenue is exclusively enjoyed by the project parties.
Sports collectibles: NFTs represent specific sports moments, with issuance and circulation rights controlled by the platform.
Virtual land: such as Decentraland and The Sandbox, these platforms hold the dominant rights for land issuance.
Although some user-customized assets have emerged in the metaverse, overall, the market has not yet truly realized deep co-creation between players and platforms.
Exclusive and non-exclusive use: new ideas for NFT usage
Currently, most NFT use cases are exclusive: only holders can use or authorize others to use them individually. This model limits the popularity of NFTs and weakens their revenue capacity. The exclusivity of NFT use is similar to the early stages of computer development, which mainly revolved around hardware like chips. You can buy, sell, or lease (NFTs already have related technical support), but it is not suitable for large-scale popularity.
In contrast, non-exclusive use is more open. The same NFT resource can be authorized for use by multiple parties, generating broader value. For example, the Little Ghost NFT can authorize brands to launch co-branded products, allowing multiple consumers to purchase and pay premiums for the products simultaneously, thereby bestowing broader market value on the NFT.
What more valuable assets can this NFT container hold? When these valuable NFTs are authorized for simultaneous use by multiple people, can NFT holders receive revenue during the holding period rather than at the time of sale? Can Web3 co-creation be applied to NFTs? Can forgotten, illiquid NFTs in wallets be awakened?
NFT games may be a breakthrough. NFTs are powerful containers that can hold not only in-game assets but also the game itself.
NFT games
Why start with games? The gaming industry often leads new technologies, whether it is the emergence of computers (text adventure games, graphical interface games), the development of PC (mouse and keyboard games, multiplayer online games), or the popularization of button phones (snake and other mobile button games) and smartphones (touchscreen operations like Angry Birds, tilt and move like Temple Run). Games have played a key role in these processes, leading innovation in user experience and interaction methods.
And it needs to start with mini-games. Because mini-game development costs are low and can iterate quickly; mini-games are easy to pick up, simple to play, and more suitable for a broad user base, with strong dissemination.
The high threshold of game development
Although mini-game development costs are low, most players, apart from program developers, lack coding ability, making it nearly impossible for these players to independently develop even seemingly simple mini-games, let alone add game creativity. However, the platform can collaborate with players for co-creation and share revenues, as the platform has technical development capabilities while players have various NFTs and other resources.
Co-creation of games
Not all games are suitable for co-creation; some games are very suitable, such as puzzle games. Because the images differ, they represent different games.
Co-creation ideas exemplified by puzzle games:
The platform develops the basic logic of the game and opens up the NFT image upload feature.
Players can upload NFT images from their wallets, and the platform generates a customized puzzle game.
Each puzzle game can be minted as an NFT, and game players enter the game through a ticket mechanism, with revenue proportionately distributed to image providers and the platform.
This model achieves a division of labor and cooperation between developers and users while avoiding redundant development. Players using their own NFTs can prevent piracy while enhancing the combinability and utility of NFTs.
The following is a comparison of physical puzzles, web2 puzzles, and blockchain puzzles using puzzle games as an example, highlighting the advantages of blockchain puzzles.
Awakening dormant NFTs
Certain long-dormant NFTs may be revived by a successful game, while new NFTs can spread widely among users through a co-creation model. Through this gameplay, NFTs are no longer merely collectibles or speculative tools but assets with practical value.
The financial nature and revenue model of NFT games
Financial nature is one of the core characteristics of blockchain games. NFT games not only bring entertainment value but also form a sustainable revenue distribution mechanism:
Initial funding and reward mechanisms
Users pay initial capital when creating the game to attract players. Players participate in the game through ticket fees and receive rewards based on the leaderboard.
Revenue distribution
The revenue generated after the issuance of game NFTs can be proportionately distributed to the platform and content contributors, and holders can also obtain dynamic revenue through usage rights during the game, rather than relying solely on the premium at the time of NFT sale.
In addition to the above, project parties with conditions can also stack points, airdrops, etc., to increase the financial nature of the game.
The broad applicability of the NFT game co-creation model
In addition to puzzles, the co-creation model of games is also applicable to other games, which should have the following characteristics:
Simple modifications can create diversity: the basic rules remain unchanged, but users can upload images or modify maps to generate unique experiences.
Lower development costs: complex logic is not needed; image replacement and parameter adjustments can complete most game content.
Easy to share and disseminate: each player's created version may attract specific interest groups.
In addition to these games, this model can even extend to other types of assets.
Of course, NFTs and games complement each other, and games may advance with the momentum of NFTs. In summary, NFTs have not been discredited; we may only have seen the tip of the iceberg in this new world, and more exploration is needed from builders.
