IOSG: Will BigTime lead a new paradigm in the crypto gaming economy?

Written by: Fiona, IOSG Ventures

This article is an original work by IOSG, intended for industry learning and communication purposes only. If you need to quote it, please indicate the source, and for reprints, please contact the IOSG team for authorization and reprint instructions. Special thanks to former Bigtime Chinese region lead Dacheng, Bigtime community ambassador Dahongniu, Jocy, and the IOSG team for their support and suggestions!

All numbers in this article are predictions, and IOSG is an angel investor in Bigtime, while Fiona is a Bigtime player, both of whom have vested interests. The opinions expressed in this article do not constitute recommendations or investment advice. Investment carries risks; readers are advised to DYOR.

It has been 2 months since the official launch of the gold mining version of Bigtime (preseason), and there are already many analytical articles on the market, but the perspectives vary. Gold mining players focus on "lower yields," "finding hourglass merchants," and "changes in charging prices," while cryptocurrency traders pay attention to "is there net deflation?" and "how is consumption?" As early investors in the gaming sector and Bigtime, along with some understanding of gold mining, we aim to objectively introduce the economic characteristics of this game to help more people understand this highly innovative GameFi product from different angles.

The Game Ecosystem is Gradually Improving

W Labs has done a good job of sorting out the economic model patterns (single/multi-coin, and gold + coin-based) during the last gaming cycle, which will not be elaborated here. Bigtime is strictly a single-coin model, where the token serves as the core output to incentivize players. This model has been common in the last cycle of blockchain games, often leading to a situation where consumption cannot keep up with output, and the related token curves can be referenced against a normal distribution curve. However, Bigtime has some unique improvements in this regard; here we will focus solely on the economy, leaving aside the game itself.

The basic economic framework of Bigtime is: different roles of players (dungeon runners, hourglass merchants, equipment manufacturers, and other small intermediaries) complete corresponding economic and gaming activities, using crystals (gold-based) as the main consumption. Through the participation of economic intermediaries like hourglass merchants, the economic cycle is ultimately completed with the output of tokens. Parameters need to be adjusted to ensure that each role is interdependent and balanced.

Note: All numbers in the examples are estimates and assumptions, and the numbers may change at any time, for reference only.

Source: IOSG Ventures,

Role: Dungeon Runner (mainly incurs costs for hourglass charging and labor, with primary outputs being tokens, a small amount of NFTs, and special materials)

Main Economic Activities: Complete all tasks in the dungeon to obtain random $Bigtime, special materials, and NFT drops (without an hourglass, only NFT drops can be obtained).

Consumption:

• Time Hourglass NFT: Can be understood as a point card; hourglasses need to be charged (time) to be used, with charging options ranging from 24 hours to several hundred hours. A single account can equip up to 5, and the higher the rarity, the higher the output;
• Consumption required for dungeons: Different dungeons have different entry requirements; some consume $Bigtime, some consume crystals, and some require holding specific equipment NFTs.

Example:

6 accounts form 1 group, each equipped with the lowest-level equipment, weapons, and 5 green hourglasses: 1) The initial unlocking of hourglass positions + the cost of empty hourglasses is about $5400; 2) The cost of 30 hourglasses with 72 hours of charging is $10k; the daily hourglass cost (excluding labor costs) is $1100 (forecasting 8 hours of hourglass consumption in the dungeon). Currently, it is estimated that about 1833 outputs are needed to break even (subject to change), with an output price of $0.6 yielding $1100. Labor costs and other friction, as well as the output of other materials and NFTs, are ignored.

Role: Hourglass Merchant (mainly incurs costs for space/guard NFTs and crystals, special materials, with primary output being hourglass time)

Main Economic Activities: Create hourglasses and charge them (usually with acceleration). Requires purchasing a large number of space and guard NFTs, upgrading guards through hourglass creation and charging; the higher the level of the guards, the less crystal is consumed for acceleration in the later stages, allowing for quick charging for dungeon runners, while extracting profit from the price difference.

Consumption:

• Space NFT: Similar to land; each space has one entrance and multiple exits (depending on size), mainly used to install guards and other functional NFTs;
• Time Guard NFT: Used for crafting and upgrading (consuming crystals and materials), filling time hourglasses;
• Time Crystals: Main consumables;
• $Bigtime: Currently, there is no consumption designed in the hourglass section.
• As of the December 5 update, Forge furnace refining fragments have been added as consumables.
• Special materials: Dropped from dungeons, can be traded on openloot, such as Lattice and Terra Core.

Example:

Using the previous hypothetical example for 30 hourglasses with 72 hours of charging: 1) Considering 1 black small space + level 50 extraordinary guard (market has no listings, estimated value $200k); 2) Assuming their charging acceleration cost is $4.1 per hour; currently, the selling price is about $4.6 per hour, earning about $1k from 30 hourglasses with 72 hours of charging. For the charging business, customer sources are an unstable factor, and revenue is affected by customer sources. Creating hourglasses is also a source of income.

Role: Equipment Manufacturer

Main Economic Activities: Manufacture equipment or weapon NFTs (no in-game bonuses, decorative items, but some dungeons may require carrying equipment or weapon NFTs with specific attributes).

Consumption:

• Space NFT;
• Forge NFT: Used for refining material fragments, crafting and upgrading weapons; rarity affects the manufacturing of different levels of weapons.
• Armory NFT: Used for refining material fragments, crafting and upgrading equipment; rarity affects the manufacturing of different levels of equipment.
• $Bigtime: According to design, it will be consumed in large amounts during the refining of materials, crafting, and upgrading skins.
• Materials: Dropped from dungeons, can be traded on openloot, such as Lattice and Terra Core.

Example:

Currently, there are almost no merchants of this type; most equipment is crafted by players to earn points, and buyers are mostly new dungeon runners (to meet dungeon requirements), with some paying players purchasing or self-manufacturing high-level equipment.

Evolution of the Player Value Chain

Over time, the economic importance of different roles has gradually emerged, and Bigtime attempts to guide different players to compete with each other at different stages of their journey.

Stage One: Dungeon Runners Dominate the Economy

From October 7 (the start of dropping broken hourglasses, marking the official gold mining) to the first economic adjustment on October 18.

During this period, players were mainly dungeon runners, and hourglass merchants had not yet emerged because the cost of hourglass charging was particularly low, roughly estimated to be 1/20 of the current charging cost. On October 18, the official first major economic adjustment increased the cost of hourglass charging, making it impossible for dungeon runners to balance both charging and gold mining costs. At the same time, the cost of crafting hourglasses was also increased, as the official found that most time guards were busy crafting hourglasses, leading to a surge in hourglass supply that exceeded their expectations.

Through these changes, the official was guiding the differentiation of roles, evenly distributing the tasks of time guards (such as crafting, charging, and dismantling). The high charging costs and scarcity of time guards prompted the emergence of hourglass merchants, bringing the economy into the next stage.

Stage Two: Interdependence and Checks Between Dungeon Runners and Hourglass Merchants

From October 18 to the December 7 update.

Hourglass merchants engage in the business of selling water, providing dungeon runners with the main consumable for gold mining—hourglass time—thus significantly impacting the latter's economic benefits. Before December 7, the consumption of hourglass merchants was not closely related to dungeon runners. However, according to the latest economic update on December 7, their checks and balances have become increasingly evident. This update added decorative refining materials as consumables, most of which come from drops in dungeons and need to be refined using the forge and armory. This way, the costs for hourglass merchants will also be related to the earnings of dungeon runners. More importantly, this update encouraged the existence of equipment manufacturers, as they would become an important part of the economy by producing decorative items using the forge and armory.

Stage Three: Dungeon Runners, Hourglass Merchants, and Equipment Manufacturers Complete the Economic Cycle Together

Future Aspirations

This stage requires not only necessary economic control and adjustments but also the entry of paying players. This premise requires a larger player base; community ambassador Dahongniu estimates that the player base needs to reach at least 100,000 for the skin economy to kick off. Currently, the official has not disclosed the number of active players, but from the leaderboard and the number of unique addresses producing outputs, we roughly estimate daily active users to be around 5k - 10k. This number has significant growth potential compared to the top blockchain games in the last bull market (Stepn had 300k, Axie had 2M). The road is long and arduous, but we still see a glimmer of hope; we have observed that the liquidity and rarity rankings of the top 4 decorative items (which have no attribute bonuses and low dungeon consumption) have increased in price compared to when the preseason started, indicating that there are a few paying players.

Distribution is Crucial in a Highly Controlled Economy

As the game economy is still in its early stages, the team's frequency of economic adjustments is high and changes are significant. Although this may cause some harm to players in the short term, it will lead to a healthier and more stable economy in the long run. The official control over the game economy is reflected in several aspects:

1. The economic model has been adjusted multiple times at various stages, such as several adjustments to the charging costs of hourglasses, and additional special material consumption has been added compared to the earliest stages. These materials can only drop through participation in in-game economic activities, aiming to continuously balance the interests of hourglass merchants and dungeon runners.
2. Control over the output of $Bigtime; tokens can only drop from game dungeons or dismantled broken hourglasses (broken hourglasses are relatively random and in small quantities, temporarily ignored), as well as airdrops. The output is strictly controlled by the project party, so the earnings of gold miners are not stable.
3. Monitoring the balance within the game; recently, there was a surge in the prices of guard NFTs (which can craft hourglasses), with the lowest-level ordinary white guards' prices rising from $50 to as high as $729. The community speculated that a large holder wanted to monopolize the hourglass merchant business by continuously buying guards in the market to gain pricing power for hourglass charging. The official noticed this and gradually controlled prices by increasing the circulation of guards through postcard airdrops and increasing the probability of guards being opened from blind boxes.

‍‍‍‍‍‍‍‍‍‍‍‍‍

For a highly controlled economy, fair distribution is a major issue. In the past, GameFi project teams generally held both the power to control economic adjustments and received token allocations, which is, in a sense, unfair. From our first communication with the Bigtime team two years ago, the founder insisted that tokens would only be generated from the game, and investors and the team would not receive any tokens, nor would there be any form of token sales. This distribution is undoubtedly very rare but also quite fair. Therefore, throughout the entire lifecycle, the circulation of tokens is strictly controlled and transparent, with no massive unlocks from investors or the team.

Iteration and Updates Will Be a Long-Term Theme for Bigtime

Bigtime has introduced many complex elements into its economic system: time crystals, hourglass charging, tokens, decorative fragments, etc. Over time, under the premise of fair distribution, this dense, complex, and interwoven economic system requires adjustments to achieve rebalancing. For example, the price thresholds of time guards and hourglass NFTs will control the number of new incoming players; reducing the rate of asset distribution will positively impact token prices, and so on.

The Bigtime project party's revenue is not tied to tokens, and they do not want to interfere too much with token prices. Although they do not share the same economic interests as players (no token exposure), the combination of crystals (main consumables) + NFT sales + market fees will yield very good company-level revenue, providing more stable long-term incentives, without needing to sell tokens to sustain operations, and not being affected by the bull and bear markets of the secondary market (development will be similar to traditional game developers). Since the preseason began, the project party has sold blind boxes 4 times, earning approximately 7.85 million. Since most items have not yet been on-chain, we can only roughly estimate: 1) Assuming 1 token is produced for every 50 crystals, the revenue from crystals would be about 5 million; 2) Based on a total market trading volume of 45 million (from the start of the preseason to now), calculating 5% trading fees, ignoring the 3.5% token withdrawal fee, this portion would be around 2 million. We can only roughly estimate that the total revenue during the preseason over the past two months could reach nearly 15 million, with the more stable and continuous market fees and crystal revenues estimated at 7 million. Based on this stable revenue level, annual income is about 42 million, considering bull market premiums, estimating 50% as annual income, projecting around 20 million annual revenue for the next two years.

In the long run, having paying players as consumers within the economic chain is a significant challenge; it is not easy for Web2 users to transition. Currently, the decorative skin economy cannot yet operate. The value of the forge and armory is very low, while the prices of guards and hourglasses essential for gold mining remain high, leading to a distorted asset market. The consumption of tokens in the game is also insufficient. This requires the player base to increase to a higher level. A good sign is that the furniture market for spaces has seen some price increases, and there are many new players, some of whom are willing to pay for aesthetics. The next stage will trend towards encouraging the growth of equipment manufacturers; if attributes of decorative items and the rights of paying players are increased, it may provide some short-term assistance, but in the long run, the growth of the player base is still necessary. Ultimately, both the team and players/token holders hope for more people to play the game and for the game to operate long-term; in this regard, the economic goals of the project party and players are aligned.