Companies sponsor gamers who can’t pay their entry fees, especially in countries with hyperinflation (like Venezuela or the Philippines), and receive part of their winnings.
From eight o’clock in the morning to five o’clock in the afternoon, Josleider Pérez serves customers at a butcher’s shop in Venezuela for a monthly wage of 80 dollars. He logs on for a couple of hours in the evenings to play Axie Infinity, a video game in which he can earn up to 100 dollars a month.
“I had enough for personal expenses. I could pay for my services, and I had money left over,” he says by video call. He is 25 years old and is an agricultural engineer.
Axie Infinity is a video game for PCs and smartphones in which players train and fight with virtual creatures to gain rewards in the form of cryptocurrency.
The creatures, known as axies, are NFTs that can also be traded within the blockchain market.
The game initially launched in 2018, but took off during the COVID-19 pandemic, with people from all over the world attracted by its play-to-earn dynamics, which promised earnings just for playing.
“I know people here [in Venezuela] who had an income of 700 dollars in just a few months. That would normally take a year and a half to two years to make, because inflation is extremely high,” says Josleider.
When he joined Axie Infinity in November last year, the game was peaking at up to 2.7 million global players per day. But then the decline began. At the end of May, just 658,000 people were connecting to play. Gamer earnings also fell.
Smooth Love Potion (SLP), one of the game’s tokens, went from being worth 33 cents in April last year to less than one cent in May 2022. Axie Infinity Shard, another in-game currency, went from 165 dollars to just 23 dollars.
Even the game’s website changed its description and now says it’s a play AND earn game, as noted by Bloomberg.
“I used to get 20 or 30 dollars every 15 days. Now, I’d say I’m getting 10 or 15 dollars,” says Pérez, comparing his experience in recent months. The butcher’s shop remains his main source of income.
Getting started with Axie Infinity isn’t free, nor are most other games on the play-to-earn market.
In Axie Infinity, you begin by buying axies, the creatures that move the game. In Karmaverse, another trending video game, you buy avatars. In others, you acquire spaceships, weapons, or other types of characters.
The price Pérez would have had to pay to start playing Axie Infinity last November was around $400. But he didn’t have to pay a single bolivar, because a company gave him a “scholarship.”
“What we do exactly is buy those digital assets and remove that barrier to entry for gamers,” says Martín Blaquier, CEO of Ola Guild Games.
The company was formed last year. This April, it received an investment of eight million dollars to expand its presence in Latin American countries. They’ll buy more NFT assets that allow them to recruit gamers who couldn’t otherwise afford to play.
“We lend to gamers. They keep 70% of what they earn and, at Ola, 30% is reinvested in the community with different games and other things, but the players never have to pay a penny,” Blaquier points out.
Ola GG is in fact the Latin American arm of Yield Guild Games, a Decentralized Autonomous Organization (DAO) founded in the Philippines, another of the big crypto gaming markets.
This corporate model is popular with these types of projects, in which players sign a collaboration agreement, without becoming employees or workers.
Yield Guild has opened regional DAOs in India, Southeast Asia, and is targeting the Hispanic market with Ola GG. However, Ola Guild Games operates legally as an independent company.
“We have our own objectives and our own flight plan that doesn’t necessarily have to do with YYG’s, but it became a partner within what Ola is, to provide us with the help we may need when it comes to infrastructure,” explains Clara Bullrich, co-founder of Ola GG.
Through the first quarter of 2022, Yield Game Guilds reported having awarded 29,420 scholarships, of which around 10,000 were from regional DAOs such as Ola GG.
Pérez found out about Ola GG while he was in the tournament chat of another game, along with other online friends.
“If we play games for fun, what could be better than investing time in a game where you can make some money?” he asks.
Ola GG recruits via a Discord community, where they organize eSports and crypto ecosystem events, among other things.
There is also a section where gamers can apply for a scholarship, after providing further information about themselves and their interests. The company claims to respond in a few weeks. After that, the new ‘scholar’ is ready to play.
Like Ola GG, other companies operate under the scholarship system for those who want to join NFT games but who don’t have the budget. Block Esports, based in Venezuela, operates with commissions of 30% to 40%.
The logo of Ola GG, the largest Hispanic play-to-earn community. (Photo: Ola GG)
Axie Infinity found its biggest markets in countries with hyperinflation or where the minimum wage is very low, such as the Philippines and Venezuela. But now that the winnings aren’t what they used to be, Josleider Pérez plays out of commitment.
“Nowadays, I continue playing out of commitment to the academy, because the game is really entertaining. We no longer do it for the money as such, because you don’t really earn much, but we’re still there to stay active,” he says.
Many players have migrated to other, more promising games, all with crypto or NFTs woven into their DNA. Star Atlas, The Sandbox, Geno Pets, and Mobox are some of the popular ones right now. Gaming guilds, such as Ola GG, have also diversified their investment portfolio.
“We’re going to eventually be offering dozens of games to our players,” explains Blaquier, “So, if one project doesn’t work out, you’ll have the chance to play several others.”
The company has just announced a partnership with Castle Crush, the latest NFT game to join its catalog. And with the recent 8-million-dollar investment, according to Blaquier, it will focus its efforts on expanding its markets, with Mexico as the focal point during the coming months.
Pérez is awaiting a new scholarship to play Karmaverse, which calls itself a metaverse and contains a handful of games itself. With crypto markets in tatters, but free electricity in Venezuela and spare time to play, Perez hopes that play-to-earn games will bring him significant income once again.
“Perhaps not right now, but within a few months,” he figures.