The Blockcrunch Podcast: How to Design Web3 Games for Sustainability

In this panel discussion, YGG co-founder Gabby Dizon explains how web3 games are adapting to the market to create sustainable games.

Blockcrunch is an educational weekly web3 podcast that conducts 40-minute interviews with the leading minds in crypto. With over 200 episodes, the podcast has featured the founders of companies like Solana, FTX and OpenSea.

YGG co-founder Gabby Dizon joins Jason Choi, angel investor at Tangent and host of the Blockcrunch podcast, to tackle how web3 games have fared in this uncertain market and what developers are doing to build game economies that are sustainable in the long run.

The following is an excerpt from the panel discussion. Watch the full recording here. 

Is there Still a Future for Web 3 Games? - Gabby Dizon, YGG, Ep 216

Jason (3:54): This year has been quite crazy for crypto markets. Everything is down, and especially for play-to-earn games, because I feel like we went through an existential moment. So I am curious where this model of paying gamers tokens to play games is going. Is that proven to be unsustainable and is that still going to be a thing in the next cycle?

Gabby (5:28): I think games are adapting their tokenomics so that they can avoid the common pitfalls. For example, I see a lot of games pivot towards more soft currencies, basically in-game currencies, so they can have better control of the economy. Tokenizing these resources inside the game, whether they are NFTs or fungible tokens, means that the players own it and you are giving them permission to sell or re-engage in the economy, and if players choose to sell, there is nothing you can do about it. The design is really being iterated upon, and I have seen a lot of games come up with different mechanics so that they can have better control of what goes on inside or outside of their in-game economy. We have found that paying for grinding itself is not sustainable. What you want is for the player to do things of value inside the game before you give them assets of value, so games are now trying to delay when players are able to take assets out of the economy.

Jason (7:03): You are now seeing games using these assets that are not tied to outside value. So, do you think that will solve the issue we see with these highly inflationary reward tokens? Is that the solution to creating sustainable play-to-earn games?

Gabby (7:21): It's a weapon that game designers have in their tool belt. Ultimately, you need to create an economy where people want to spend, and maybe you divert that amount of spend towards player value, whether that is NFTs or assets.

Jason (7:41): What do you think are the crucial parts to be on-chain? I think in the past year, what we have learned is that most games don’t really need to be on-chain to be fun at all, and there is often an over-emphasis on the economy over gameplay in web3 gaming. So when we go back to the first principles, what parts of the gameplay can be improved by being on-chain? 

Gabby (8:12): Putting assets on-chain, you are forcing a data standard that anyone can use, and adding smart contracts also means it's basically forced interoperability, which is really hard to do outside of blockchain because it's difficult for games to talk to each other. Even in the same company, you don't see a lot of interoperability between Warcraft and Diablo, for example. So, hardening these ways that people can work with each other either with NFTs, ERC20 tokens, or via smart contracts, but it forces interoperability, which I think is great. And with smart contracts, you can track program value inside and outside the virtual economy, so we are just starting to see the use cases, and I am already excited to see the games that are coming up to do this.

You can watch the full discussion on YouTube. 

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