As you are new to cryptocurrency trading you will have already come across and invested in the likes of Bitcoin and Ether.
You’ve no doubt also decided on a sound crypto investment plan, with sufficient financial reserves to deal with losses, and set up an account with a reputable secure exchange such as BigONE to manage your trading activities.
And now having reviewed all the various options you are keen to find out what the next big thing in crypto is, which is exactly what I’m here to talk about. So, without further introduction, let’s take a deep dive into the world of meme coins, the metaverse, DeFi and an emerging exciting sector in gaming called play-as-you-earn, also known as GameFi.
But to start by setting the context, so you are the most equipped traders coming into this booming sector of crypto investment, let’s look at the rise of meme coins, created originally as a joke about crypto which have taken a life of their own as their popularity has soared and new meme coins have emerged with real world use cases since the launch of DogeCoin in 2013.
Trading tokens in the metaverse?
It’s also not hard to see meme coins use in related sectors such as music and particularly gaming, as a cross-proprietary platform currency to enable the vision of the ‘multiverse’ or more commonly known as the metaverse.
So back to the role of crypto, or the lack of it to date, in the metaverse.
Despite the frictionless use of crypto, with low fees and decentralized P2P structures, the reality is that the commercial first movers in the metaverse space from gaming have their own proprietary currencies.
What makes DeFi so attractive to the metaverse community is that it can be automated, without any centralized intervention. It also means that DeFi has long term attractions, allowing game developers and players to invest time and money knowing the underlying blockchain platform won’t change without crypto community consensus.
NFTs
As newcomers to the world of crypto trading you may not have heard of the metaverse before, but you probably heard of NFTs and the headline grabbing rise in value of these unique digital assets.
According to my understanding of economics, the term fungible relates to anything that can be exchanged for something of equal value. Most investors know that the nonfungible token (NFT) sector has been on fire since July, and as the likes of CryptoPunks.
The DAO is the final piece of the jigsaw that is key to the creation of a metaverse that is open, rather than one run and controlled by the Facebooks of this world. What’s interesting about this novel form of organisation, without a central leadership or the usual management structure used for companies or other entities, is that it’s giving birth to a new way to make money called play to earn or GameFi.
In a close fit with the vision of an open metaverse, play to earn crypto games are built on the fundamental need for a place that is available to everyone and owned by no one in particular.
An amalgam of gaming and decentralized finance (DeFi), ‘GameFi’ refers to the intersection between blockchain-based gaming and decentralized financial instruments in all their guises: yield farming, lending/borrowing, algorithmic stablecoins, token minting instruments, etc.
GameFi essentially means that people are playing a game to profit with real money with payment in the form of cryptocurrencies. Some players play games and earn crypto simply because they enjoy it, and the monetary rewards simply come as a bonus. While there are other players who play to earn crypto games as their main source of income.
The key idea is that players play games to earn crypto, and their earning potential will increase or decrease depending on the amount of time a player is willing to spend playing the games. Likewise, as a player’s skill improves so will her/his potential profits increase. With play to earn crypto games the more you play and the better you get at the game the great financial rewards you can earn.
Concluding remarks
A more optimistic take is that the GameFi ecosystem has started to grow and mature thanks to a plethora of unique P2E models that have seen revenue generation incorporated into gameplays. Also impressive is the amount of finance being devoted to developing the infrastructure required to take GameFi to the next level. Taking an ambitious view, with consequences for trading opportunities for the future, and not just in the short term, this arguably means global adoption that rivals traditional gaming economies.
Certainly, as the metaverse becomes more and more a reality GameFi will play an important part, helping users to access a market to trade gaming assets across their favourite platforms, in turn helping grow future inter-connected P2E ecosystems. Understanding this GameFi growth trend early on will enable you to better spot trading opportunities today, as well as see opportunities for the future.
