What is Play-2-Earn?
Play-2-Earn (P2E) presents an exciting emerging opportunity in the crypto-asset market by integrating crypto-assets and video games. This market segment has seen explosive growth over the last year. Now with well over a million daily users, hundreds of games and billions of dollars of crypto market cap value, alongside over USD $4 billion of venture capital deployed to support further development. As more games are announced almost daily and major publishers and developers begin to dive in Hulk Labs is on the ground floor looking to provide opportunities for retail investors to gain exposure through our expertise.
WHAT IS P2E?
As the crypto-asset market began to grow and more use cases came about with the introduction of smart
contracts, gaming was an obvious choice for integration. By leveraging cryptocurrencies for in-game currency and Non-Fungible Tokens (NFTs) as representations of in-game asset ownership, new and innovative models have emerged. These innovations are based around blockchains and provide underlying technical infrastructure to support both in-game and external markets for digital assets, ensuring ownership and providing mechanisms for transactions and storage.
P2E is a model where investors and players can earn real returns for their in-game assets and their time playing the game. Many games have internal economies where players buy and sell in-game assets whether from each other or from developers and P2E is based around the crypto-assets that can further enable these interactions. It also provides opportunities for asset owners, players and developers to earn yields and rewards for game assets and playing in a transparent and mostly automated way. Not only that, but by issuing an underlying token, new ways to raise capital for developers have become available. Through this we have seen a huge inflow of players, capital and new game development.
Real-Money-Trading (RMT) and transactions in gaming are not a new phenomena, and have helped underpin massive growth in the gaming industry over the last decade. This growth coincides with the expansion of the mobile phone market, but console and PC gaming have also seen sustained growth. The gaming market as a whole represents an estimated value of USD $173 billion as of 2021 with estimates of reaching over USD $300 billion in the next 5 years. With the introduction of P2E and the opportunities it unlocks for RMT and in-game financial rewards, there is the possibility for even greater growth.
Despite the short period of time and experimentation, innovation is coming fast. While game development can often be an expensive and long process, we have already seen some real successes both for the developers themselves but also more broadly in the expansion of gamer demographics globally. Millions of new players have entered the market as the financial returns provide attractive incentives for demographic groups often overlooked by game developers. Players in Southeast Asia have helped propel games such as Axie Infinity to the top of the space and helped identify new opportunities in other emerging markets.
The ability for investors to provide capital to players through mechanisms like scholarships, which link asset owners with players who can borrow the asset and earn a portion of the return for using it in-game, is an exciting innovation that provides opportunities for generating yield and returns for both parties helping to support further growth in the market. While these models and the tools for using them are still in their infancy, the rapid growth is real.
With a growing market of 2 billion mobile players globally, a phone and internet connection can now provide real money making opportunities almost anywhere in the world. It is no surprise that player numbers and game development are growing at an accelerating pace.
Hulk Labs provides a unique avenue for retail investors to have exposure to this growing crypto-asset class through leveraging our collective expertise and capabilities. The ecosystem today is crowded and noisy with hundreds of games with more launching almost daily. Our team’s expertise in crypto-assets, our industry connections and our ability to develop and utilize specialized analytical frameworks and systems give us the capability to separate the signal from the noise.