From the perspective of the entire chain game, the new paradigm of GameFi: Battle to Play

Author: 0xfinley, AC Capital Research

Games have always been considered one of the core narratives in the Crypto world, addressing the pain points of investors and users with concepts such as attracting more Web2 traffic, ownership of game assets, verifiable on-chain data, global players online together, and unified currency payments. In the last bull market, Gamefi attracted a large influx of users by monetizing game assets and items, with projects like Axie and Stepn generating widespread breakout effects. However, the Ponzi-like model of Play to Earn could not escape the fate of a death spiral, and the heavy financial gameplay caused many genuine players to retreat.

From the perspectives of on-chain data verification, ownership, and asset programmability, fully on-chain games have quietly emerged. This concept, which has not yet entered the user’s field of vision on a large scale, has already become a highly promising track in the eyes of some OGs, seasoned Gamefi enthusiasts, and investors.

Fully on-chain games generally refer to a type of game where the core gameplay, game logic, and game assets are all deployed on-chain, i.e., On-Chain Games. Fully on-chain games are characterized by a high degree of decentralization, fair and transparent game mechanics, and greater openness and composability. There are already many popular science articles about fully on-chain games, so I won’t elaborate further here.

Due to the performance issues of underlying infrastructure, most mainstream chain game developers previously executed game actions off-chain, only putting the final results related to assets on-chain. For fully on-chain games, they still cannot escape the limitations of on-chain performance at this stage; if all game actions are on-chain, it is destined to be a lightweight game model.

01 Game Theory May Be the Core Gameplay of Fully On-Chain Games - Battle To Play Model

What kind of game model might be a new gameplay for fully on-chain games? We propose the Battle To Play model, where users engage in games against the game mechanics or against each other.

First, if a game’s gameplay is lightweight, requiring fair and transparent mechanics, and needs to leverage the privacy and high liquidity of Tokens, then it must be Gambling-type games. Since the entire game system is on-chain, the design of the gameplay, mechanics, and data during play are all verifiable, maximizing the avoidance of unfair behavior.

If ZKP technology is also utilized, it would be even better. The system can use ZKP technology to prove the randomness of the game and ensure that the input and output results of users cannot be cheated. For example, in board games, random shuffling and dealing can be achieved without visibility from users or third parties. Only when users receive their own hands will it be visible, providing a fairer and safer gaming environment for Gambling games. Similarly, game developers can also integrate privacy-related settings to protect users' account, fund, and transaction privacy.

According to Statista's estimates, the global online Gambling industry market size was about $60 billion in 2021 and is expected to reach a trillion-dollar scale by 2028. Such a massive industry scale is entirely possible to be transformed. Currently, the overlap between Gambling users and Web3 users is not high, and the core business still revolves around simple, addictive Gambling gameplay design, secure and stable deposits and withdrawals, and high user liquidity brought by large-scale marketing. We judge that the path of transformation should involve traditional Gambling businesses actively making changes, gradually leading users into the Web3 world. Although we have not yet seen any blockbuster Gambling games emerge, we believe this is a trend.

02 What Happens If We Shift the Focus of Gambling Games from Asset Layer to Gameplay Layer?

New Value Flow

Users can gain a sense of achievement and even profits by battling against the game mechanics or other users, similar to traditional PVE challenges and PVP modes. In this case, integrating Gambling gameplay would transform the value flow into:

The confrontation with game mechanics would be similar to the PVE mode in traditional games, where game developers design various challenging levels to attract players. Players can bet on themselves to challenge levels or bet on others, with winners receiving rewards from the prize pool. Smart contracts ensure smooth settlement after each game ends. The benefit of this model for players is that they can not only enjoy the pleasure of winning challenges but also gain economic benefits and even fan communities; for developers, it allows them to present their creative ideas as gameplay to players, achieving direct profits through designing challenging gameplay, no longer limited to in-game item skins or ad revenue. Of course, balancing the difficulty and the rewards players receive for successfully completing challenges is key.

The confrontation between players is akin to the PVP mode, where the outcomes are more unpredictable, gameplay is more diverse, and more entertaining. For example, in traditional games, there are asymmetric competitive games that emphasize strong gameplay and player operations, such as "Dead by Daylight" and "Identity V," as well as strategy-focused games like "Dune" and "Warcraft," and logic reasoning and performance games like "Werewolf" and "Duck, Duck, Goose." These types of games could all potentially be designed using the Battle to Play model.

Moreover, in the Web3 world, players from different chains and communities can participate as opponents in the game and betting, for users, defeating the opposing player may provide a greater sense of achievement than completing a challenging level. For developers, choosing which type of game to create requires consideration of the appeal of fair game mechanics to players while avoiding the pitfalls of social casual games. Lightweight does not equal social casual; currently, social casual games fundamentally conflict with on-chain mechanics, as social casual emphasizes emotional connections and user experiences, which on-chain games struggle to satisfy.

In fact, we can glimpse this from currently popular chain games. For instance, Darkforest, a real-time strategy game based on the xdai chain, is itself an asymmetric game among many unfamiliar users. There’s also Trident, based on the Arb ecosystem, which features real-time pet battles suitable for full on-chain gameplay.

New Profit Model

For a game:

First: It can either attract players through gameplay, allowing them to gain visual, sensory, and spiritual pleasure from the game, thereby recognizing the gameplay and culture, remaining loyal to the IP, and guiding them to pay for game items and assets in the process.

Second: Players can earn profits through their efforts, skills, or investments within the game.

Traditional games focus more on the former while incorporating the latter to some extent, with the main profit model being buyout or in-game purchases; the Play to Earn game model is designed from the latter perspective, with the main profit model being the sale of tokens/NFTs and transaction fee income.

Under the Battle to Play model, developers have a new profit avenue, earning commissions through the gameplay itself. Additionally, developers can implement tiered pricing, where players with higher skill levels and profit potential may face higher entry fees, and of course, these players will also receive corresponding honors and rewards.

03 What Happens If We Add Openness and Composability to the Mix?

Fully on-chain games, due to their high degree of openness, maximize the potential of UGC. Developers only need to define the original operational rules of the game, and the community can perform secondary development of functions and components based on this, similar to the Mod features commonly seen in traditional games, but with greater freedom, native integration with game assets, and less susceptibility to centralized review. For example, in Darkforest, players can use community-deployed contracts to assist in exploration and resource collection, such as Crawl Planets, which captures nearby planets with one click; Distribute Silver, which automatically distributes selected silver mines to surrounding planets. Since all game logic is on-chain, developers cannot prevent players from doing so.

DeFi Summer was initiated by AMM, but its growth was fueled by continuously nesting various models under mainstream assets as collateral, with mining, lending, and leverage emerging in abundance. Assets flow between different protocols to capture value, and the composability between protocols plays a crucial role. Similar to DeFi, game characters and items can also be combined, which means the idea of building numerous games and other derivative products based on a single set of assets is gradually becoming feasible. A typical example is the series of derivative content built on Loot: Realms, Crypts and Caverns, Loot Character; and the Treasure DAO game ecosystem on Arbitrum.

In the Battle to Play model, the high level of community participation makes gameplay more diverse and interesting. Whether it’s PVE or PVP, if the game mechanics are solely designed by developers, their creativity may run dry, and game mechanics will inevitably have certain limitations that may not be favored by players. The community can fully take on the outsourcing of server and secondary development work, then customize development based on member votes. Mature gameplay can also be pushed to the market to gain more attention and revenue, and players are more willing to pay for gameplay modes in which they have a sense of participation.

For independent creators, they can construct their visions freely on existing game protocols, similar to the "private servers" seen in traditional games. Excellent servers will also attract a large following, and due to the interoperability of underlying protocols, players' identities and assets can cross over between different "private servers," allowing these "private servers" to mutually support each other in the growth of the entire ecosystem and capture revenue.

04 If We Wish to Expand the Influence of the Battle to Play Model, What Technical Improvements Do We Need?

Backend Needs ZKP Technology and Multi-Chain Compatibility

ZKP technology, or Zero-Knowledge Proof, could have a significant impact on games in terms of scalability, privacy, and fairness.

First, the current online game architecture is mostly client-server, where players' important information is stored on the server, and the states between players need to be synchronized through the server. With ZKP, the client can verify important user information without storing data, and it can even enable P2P sharing of game information between players. Since these game information are verified through ZKP, they will comply with the rules.

ZKP allows users to verify information without exposing it, so in game types like battles, matchmaking, strategy, and Gambling, players' personal ability information, user data, and even game strategies can be well protected.

Multi-chain compatibility technology ensures that from a user experience perspective, players can participate in games without needing to cross chains. Developers can help players seamlessly integrate through built-in underlying cross-chain technology, and the settlement assets and profits obtained by users can be used on the source chain. The integration of multiple chains will not only bring more users but also intensify competition.

Frontend Needs a More User-Friendly Client

Currently, fully on-chain games are still in the early stages, with developers focusing more on the rules of smart contracts, on-chain interaction interfaces, and frontend display interfaces. As a result, the client is relatively rudimentary and presents a certain barrier to entry for general users. When fully on-chain games attract a larger scale of users, frontend display will be a very important aspect. Of course, we have reason to believe that as the game community gradually expands and contributors and loyal players increase, this issue can be well addressed.

The ecosystem of fully on-chain games is still in the early construction stage, with everything from underlying game logic to user-facing products being quite hardcore. However, we have already witnessed the charm of transparency and fairness from the past development history of Web3, and we have seen the power of composability in traditional games like Minecraft, Roblox, and Steam's creative workshop. Battle to Play perfectly showcases the characteristics of fairness, transparency, and composability. This road is still long; whether fully on-chain games centered around Battle to Play will become the core gameplay in the next bull market remains to be seen.

Reference Links:
https://aiko.substack.com/p/84b
https://www.defidaonews.com/article/6797362
https://medium.com/id-theory/pureplay-on-chain-games-74169a38484a
https://hackmd.io/@AaHqx7cQt2u0TeMIC5hQ/BkUx3g6ho
https://volt.capital/blog/the-future-of-on-chain-gaming
https://jumpcrypto.com/defining-on-chain-gaming/
https://www.binance.com/vi/feed/post/151533
https://messari.io/report/analyzing-market-potential-of-fully-on-chain-games
https://cryptoslate.com/why-the-future-of-gaming-will-be-on-chain/