Jarindr Thitadilaka claims he earned up to $2,000 per month last year from his collection of digital pets, which he bred and sent into battle to win cryptocurrencies.
The 28-year-old Bangkok resident was engaged in Axie Infinity, one of a new breed of blockchain-based online games known as “play-to-earn,” which combine entertainment and financial speculation.
In the midst of the hype surrounding NFTs and virtual worlds, these games can be lucrative businesses, attracting millions of players as well as billions of dollars from investors who see the games as a way to introduce more people to cryptocurrency.
Users in Axie Infinity purchase virtual blob-like creatures with varying attributes as NFTs – digital assets whose owner is recorded on the blockchain – for tens of thousands to hundreds of thousands of dollars.
Players can then use their pets to earn money by winning battles and creating new pets, the value of which is determined by their rarity. The assets can be traded with other players on the platform, which has 1.5 million daily users, according to its website.
“It’s no longer just a game. It’s more akin to an ecosystem “Thitadilaka stated. “Can you even call it a country?”
The risks of this speculative ecosystem, as well as the largely unregulated crypto gaming industry, were brought to light last week when Axie Infinity was robbed of $615 million. Hackers targeted a component of the system that transfers cryptocurrency into and out of the game.
Sky Mavis, the Vietnam-based owner of Axie Infinity, stated that it would reimburse the lost money with a combination of its own balance sheet funds and $150 million raised by investors including cryptocurrency exchange Binance and venture capital firm a16z.
Sky Mavis co-founder Aleksander Larsen told Reuters that if he could go back in time, he would have prioritized security when expanding the game, which debuted in 2018.
“We were basically running at 100 miles per hour to even get to this point,” he explained. “Perhaps the trade-offs we made weren’t the best ones.”
Haves and Have Nots
Unofficial financial networks have emerged around these games, adding layers of complexity, as some players leverage their coveted in-game possessions for additional gain.
This model is common in play-to-earn games. Thitadilaka stated that his guild, GuildFi, has grown into a network of 3,000 Axie Infinity players who split their earnings 50:50 with the asset owners. Thitadilaka now works full-time for GuildFi, which has raised $146 million in funding from investors.
Thailand and the Philippines, for example, have emerged as some of the hottest global gaming hubs.
Teriz Pia, 25, of Manila, quit her job as a pre-school teacher in June after her brother founded the Real Deal Guild, a play-to-earn gaming guild.
However, proponents of these games argue that success is based on a combination of factors such as skill, strategy, and luck.
“There is definitely money to be made here, but there is also money to be lost,” Wilton of Pegaxy added. “Playing for a living should not be confused with charity; that is how people are harmed.”