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Play-to-Earn video games like Axie Infinity promised a lot but fell short

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For a brief heady moment during the pandemic, people in some parts of the world, especially the Philippines, turned to video games for work rather than pleasure.

“Work” was flexible, could be done remotely on a smartphone, and came at a time when COVID-19 was devastating people’s lives and incomes.

They weren’t professional esports gamers or people who make a living by live-streaming their gaming exploits on Twitch.

Shealtielle Blaise De Jesus researched Axie Infinity in college and played the game herself.(Provided: Shealtielle Blaise De Jesus)

Shealtielle Blaise De Jesus describes herself as an “average player” who got into the game for one reason only: money.

“I decided to play [the game] Axie Infinity because I needed extra money as a student,” the 20-year-old Filipina said.

Learning to play was a challenge, but during her most successful time playing, Ms De Jesus said she was able to earn around 1,500 pesos ($37) a week – a decent extra income for a student.

A game gig economy?

So-called “play-to-earn” games incorporate blockchain technology, which allows players to earn tokens that they can exchange for real currency.

Ben Egliston, postdoctoral researcher at Queensland University of Technology, said some investors have called Axie Infinity a flexible way to make money from home during the COVID pandemic.

“It’s really framed like how a lot of gig-economy-style companies talk about themselves, like giving people flexible work arrangements… [and the possibility of] make as much money as you want in theory,” Dr Egliston said.

But like the gig economy, Dr Egliston said, playing to win the games were deeply exploitative in practice, especially when involving low-income players in the developing world.

Cute cartoon style characters slide through a winter scene on a sled
Axie Infinity is described by its creators as a “virtual world full of fierce and adorable animals” that can be “battled, collected, and even used to earn cryptocurrencies.”(Provided: Sky Mavis)

To play Axie Infinity, the best-known play-to-earn video game, players had to purchase NFT (non-fungible token) characters with real currency that last year cost hundreds of dollars.

Players who could not afford to buy their own characters could rent them from investors who owned characters and then took a share of the in-game currency they earned.

These actors were known as scholars, and the investors who leased their assets were known as managers.

“Investors said, ‘What if we just start buying these assets and renting them out to low-income players,'” Dr Egliston said.

“You have these kind of wealthy ‘whales’, basically, who own these crypto assets, who then rent them out to these other players who get a cut.”

Roads, buses and trucks line a busy road seen from a bridge above.  The sun is setting in the background
Axie Infinity was popular in the Philippines as a flexible way to earn money from home.(ABC News: Mitch Woolnough)

A spokesperson for Sky Mavis, the developer of Axie Infinity, said it was not a game to win.

However, the Axie Infinity website teaser states “join the blockchain game to win the revolution with Axie Infinity!”

The company also refers to “play to win” elsewhere on the site.

The spokesperson said the ability for players to earn token resources and sell them on an open market allows some players to “earn a living from gambling.”

He said the game allows “knowledgeable” players to generate resources without taking any risks.

The usual split between director and researcher was 70:30, he said.

“Without any risk to the scholar, where is the exploitation,” he said.

The spokesperson said a new version of the game, Axie:Origins, would be available soon and players could sign up for free “without having to go through a middleman.”

“Blessed and Stressed”

In 2021, in addition to trying to play to win, Ms. De Jesus investigated the experiences of Axie Infinity players in the Philippines as part of a university research project.

“Most of the time our participants responded that they were really blessed, really lucky to have this opportunity because when the COVID-19 pandemic hit a lot of people lost their jobs, or they couldn’t get out” , she said.

“So they were really grateful for [Axie Infinity] and they didn’t care about the stress as long as they were making money.”

The stress experienced by the 20 players interviewed by Ms De Jesus stemmed from the relationship between the players [scholars] had with their managers, she said.

Ms De Jesus said players feared they would not be able to meet minimum daily quotas set by their managers if they suffered a losing streak.

An advertisement for Bitcoin, one of the cryptocurrencies, is displayed on a building.
Play-to-Earn games were touted as “new hip hop” with the potential to put players on the path to prosperity.(PA: Kin Cheung)

Lack of sleep and irritability after long hours in front of a screen have also taken their toll on gamers, Ms De Jesus said.

While the term play-to-win may be new, Dr. Egliston said ethical concerns about the potential exploitation of labor within crypto gambling hierarchies were nothing new.

Appearing in the early 2000s, players of games like World of Warcraft could earn in-game currency and sell it through a third-party exchange for real money to players who didn’t want to spend their time in the game. amass themselves, Dr. Egliston said.

This practice led to “gold culture”, where an emerging digital working class, mostly in China, played games for hours to generate in-game currency which was then sold for cash. real money to richer players.

“It was basically outsourcing labor to poor rural areas in China, as well as incarcerated people in some cases, to just sit in front of their computers and generate those kinds of assets in the game,” Dr Egliston said.

“There are some real lessons we can learn, thinking back to the much older era of gambling to win, even though it wasn’t really called that,” Dr Egliston said.

Two gold coins with the letter B in the middle.
The term play to win may be new, but the concept has been around in some video games since the early 2000s.(Unsplash: execution)

Too good to be true?

Ms De Jesus said she stopped playing Axie Infinity due to the recent cryptocurrency crash.

“I lost my enthusiasm to continue playing because of the SLP [in-game currency] value,” she said.

“I’ve noticed that players in several communities are converting their SLP into cash as soon as possible… [there was] panic selling.”

According to Bloomberg, Axie Infinity had around 2.7 million daily users at its peak in April 2021.

As of last week, the game had around 111,000 active players.

a hand holding a mobile phone with shows the rise and fall of cryptocurrency trading
The value of bitcoin has fallen significantly since late last year. (PA: Dave Hunt)

But the recent cryptocurrency crash isn’t the only force behind Axie Infinity’s declining value and declining player count.

In March, hackers stole nearly $921 million in cryptocurrency tied to Axie Infinity.

“There are also fundamental issues with the economics of these games, which have yet to be resolved,” said Paul Delfabbro, a professor at the University of Adelaide’s school of psychology.

As players generated more and more in-game currency, the value of tokens went down because generating more tokens out of thin air was inflationary, Dr. Delfabbro said.

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