Game On

Tracey: [00:00:20] Welcome to the Crypto Curious podcast. Designed to help you navigate the dynamic world of cryptocurrency. Hello, my name is Tracey, and I'm joined by my mates, Blake and Craig. Hey, guys. Speaker 2: [00:00:31] Hey, Trace, how are you going? Craig: [00:00:32] Hey Trace, excited for this one.  Tracey: [00:00:34] Hey guys. So in last week's episode, we Covid the magical world of NFTs and touched a little on the way gaming interacts with this world of cryptocurrencies. We talked about how people were getting rich selling crypto punk cartoon NFTs for millions of dollars. But we also talked about how gaming offered more of a use case for the NFT space. Gaming is getting a lot of air time at the moment, and even more so now, with the recent news from Facebook as a rebrand to Meta. This is all part of the same sphere, and we'll explore this a little further in today's episode. Craig: [00:01:13] The gaming industry is currently worth $180 billion, up 23 percent from 2020, so you can assume that the pandemic played a part in this, but the industry is very hot right now. So, you know, for me, all these hours I spent playing FIFA might actually be worth something one day. But you must be thinking, you know, how was this actually turning into investment opportunity? So think about how awesome it would be if you can log in to your favourite game and actually earn money as you play. Now, you don't need to be a professional gamer to do this anymore. You can just be playing a game that you generally enjoy. This is now reality with player to earn features that these crypto games now offer. Blake: [00:01:51] Yeah, exactly right, Craig. And I think the gaming has really evolved quite a lot since the 90s. You know, when I started gaming, I was playing Nintendo 64 America on a console that was, you know, which was super fun. And then as I got a bit older, I started playing PlayStation and network games like Halo. And now these virtual worlds are taking it one step further, and they're becoming these fully immersive virtual worlds that are analogous to the real world. And these virtual worlds are becoming generating their own economies that have goods and services that you can buy and sell their supply and demand dynamics for things like characters, skills, goods, land and even some of them have their own currencies. And as I mentioned, you know, these places are becoming less of a game and more of a virtual world. Tracey: [00:02:48] Yeah. And look, I was not a gamer growing up. That wasn't really my bag, but I do have two small boys and they are gamers and look like, you've said these games are becoming their own economies. And a good example of that is my son asked me just recently for some cash to make an in-game purchase on roadblocks, which is a really popular game right now. And he wanted to buy a bandana to make his little avatar, dude, look cool. So there's actually real money coming into that game. And, you know, games such as Fortnite, which have generated over $10 billion of in-game purchases over the past few years, are hugely popular, and they can do this by offering, you know, in-game purchases by way of these rare skins, as skins are things that you get dressed in or buy in-game. And those are things also like guns or swords and what have you. And they offer different battle passes and other things that you might need to unlock the next level. Now you can imagine actually purchasing those things and then being able to sell them in the real world or take them to another game or even being able to make a profit on these. And that's where these new crypto style games differ to such games as Fortnite. Games like Star Atlas, which we'll talk about a little bit later on, allow you to buy your items as an NFT. And we spoke about NFTs or nonfungible tokens in a previous podcast so you can go back and give that a listen. But these carry real world value, and you can actually take them out of the game so you can put your Atlas spaceship on display in another one of these metal verses altogether. So there will be a lot of other creative uses for these things, and they'll be in high demand for these for these game assets. So what this means is that they'll end up being entire in-game economies being built out. Craig: [00:04:51] Yeah, that's a really important point that you raise now. You can buy items on Fortnite and then when you're ready to move on and play Minecraft, you can't sell your. Fortnite skin, or you can't sell your Fortnite sword because it's all stuck in Fortnite, whereas in the new ecosystem that you're referring to, the idea is that you'll be able to sell your Fortnite bandana, get some in-game tokens, then go to Minecraft and buy a weapon with those in-game tokens. So that's, you know, really the metaverse economy that we're all talking about. Tracey: [00:05:24] With that in mind, how do we actually get the money out of the game that we're playing? Blake: [00:05:29] Yeah, but just speaking to that last point, you know, it could be the case that over time that all these metaverses they join up with one another and they become one ultraverse. but play to earn is really interesting. And one of the key games that has come to prominence in the crypto space is called Axie Infinity and Axie infinity was designed to teach people how to play, you know, play to earn games. So it was the first iteration of the game, and it's kind of like you buy these cards to play and they kind of look like Pokémon. And it costs about $600 US dollars to get started. And then you use these cards to go into battle and you play other people and you can earn smooth love potion tokens. And whenever you, whenever you, whenever you win and you get some of these tokens and then you can sell them down for real world cash. And this is turned into a massive industry in the Philippines. You know, there's millions of players globally now, and people are quitting their jobs because they can earn a better living inside some of these games. I think it's just an indication of how huge this market's going to be. Already, the gaming industry is worth three. There's 3.2 billion gamers globally, and it's generating tremendous amounts of revenue. Tracey: [00:06:58] That's madness, and that's in huge numbers. And that's why a lot of people are betting on the success of these games. For example, people are buying, you know, the in-game tokens to earn the fees. So if the game is extremely addictive, you know, and it gets adopted by a lot of people on a large scale, it means that those coins and those NFTs will end up being worth a lot of money. Craig: [00:07:20] It's really interesting to see where this will end. Like, as Blake mentioned, the Philippines applying Axie Infinity and now people are actually buying these expensive ACSI Pokemon that Blake mentioned and hiring people from the Philippines to play and share the in-game rewards. It's creating a pretty crazy industry. And who knows, you might even say Goldman Sachs and JP Morgan hiring gaming teams for their NFT portfolios, but it's just crazy stuff. Blake: [00:07:47] And because it is a hybrid entry, often these Filipino players or people in the emerging economies need sponsors from the first world to allow them to to share their their resources so that they can work together to generate a revenue from these games. So it's created this environment where people in the West are hiring people in the east to to play on their behalf. A friend of ours now has 27 players in the Philippines that are playing Axie Infinity on his behalf, and he's looking to scale this to over 100 players in the next couple of weeks. So pretty fascinating to see how this all ends up. Tracey: [00:08:26] He's going to be so happy that we've mentioned him on the podcast to summarise what we've been talking about gaming and these different universes and in-game economies. And things like that is what are commonly called the metaverse. So think about the Ready Player One movie if you've ever seen that and if you haven't gone watching it because it's pretty much exactly what we're talking about. Craig: [00:08:48] Yeah, and the Metaverse is a bit commonly misunderstood, but the Metaverse isn't actually a website that you go into to engage like a metaverse is the concept of a highly immersive virtual world where people gather to socialise, play and work. Tracey: [00:09:04] So, yeah, let's talk now about Meetup, which is the newly renamed Facebook and what Zuckerberg plans to achieve and how this fits into what we're talking about now. So Meta is referencing the metaverse. So for me personally, I don't use Facebook anymore, and I actually thought this maybe the phasing out of Facebook and the phasing out of Zuckerberg and we were kind of over and done with that, which I was happy with because I'm not a big Facebook fan, but he's got his hooks back into us now and he's come up with mitter. He's rebranded because the young people of now don't use Facebook. You know, it's kind of in the past and I thought that it was done with, but MIT and the Metaverse, this is truly now. This is truly what's happening. Blake: [00:09:51] Yeah, it's pretty interesting because I think you're right, young people don't use Facebook anymore. They're not engaging with it like people did, you know, five years ago and. Transitioning Facebook to a metaverse is really a stroke of genius if they're able to execute. But I don't really know what they have planned. I know that Facebook and Twitter have been making investments into virtual reality companies and augmented reality companies for years now. So the writing may have been on the wall, but I suspect that the vision is for Facebook games. Facebook marketplaces. Communication between communities will all form part of the Facebook Metaverse, and they will probably have their own currency as well. Inside this, which is also fascinating, but it's also a little bit creepy. You know, Facebook has a very good track record of managing people's privacy, and you're living in Facebook world, you know, kind of the air is a little bit scary. Tracey: [00:10:52] Yeah, exactly. What are your thoughts, Craig? Yeah, I was Craig: [00:10:55] just listening to you guys and just thinking, you know, Tracy, you mentioned that your kids are playing roadblocks. Is that where kids are hanging out now? They're hanging out and roadblocks Minecraft. And that's where they chat to each other. So there's not really a need for Facebook anymore, is there? Tracey: [00:11:09] Not really, I guess. Yeah. I think it's more about virtual though, isn't it? It's about an experience or being in the one place or. Yeah, look, I'm not on again. I'm not sure it's going to go like, Blake said. It's just going to be it's going to be interesting to see, but perhaps you put a pin in that one there. And, you know, we keep a close eye on it and see how it develops. So I think we to go to an ad break from here. And when we get back, we're going to go over some of the other games that are out there and have a closer look. So let's have a look at some of the games that are out there, starting with Alluvium Craig. Craig: [00:11:40] Yeah, Alluvium isn't out yet, but it's quite similar to Axie, where it's a game where you can earn the ILB token. Now, the ILB token has been on a run lately as more trailers and previews of the game come out. But the show that I saw is that you actually battle people on Alluvium and the winner gets Ethereum. It's like a tech install fight, a game which just looks awesome. Something to note is that Alluvium will actually be built on Immutable X, which is an Aussie company. Now, remember when we spoke about Ethereum and the skyscrapers on Ethereum, they're referred to as Layer 2's now layer 2's side chains of Ethereum that figure out a way to transact with no gas fees and faster transaction times. Now this is what Immutable X is, which is pretty cool, because if you want to buy and sell in-game assets with the alluvium exchange, it can be done so cheaply and quickly. And I think these solutions are going to be really key for mainstream adoption of NFT gaming. So, yeah, Alluvium, it's not out yet, but it's looking pretty cool. So check it out. But what have you got for us, Blake? Blake: [00:12:49] I'm going to talk about Star Atlas, and Star Atlas is one of the most ambitious games to ever be built, and it's expected to take seven to 10 years to fully develop. And it hasn't even been released yet. But there's so much excitement around it and the metaverse that they're going to build out, and it's done in a futuristic space theme. And people can, you know, be pilots, they can be fighters, they can be janitors and they can be miners in the game and in all sorts of characters. And you can buy things like spaceships and cool alien weapons and all sorts of things and all the assets. NFTs, which means that the user owns them, is also going to be like an in-game currency. And over time, the game is going to move towards being decentralised, which means that there'll be a governance token as well. So the participants in the game can contribute to the decision making and the direction in which the game develops. And interestingly, a friend of mine is currently saving up to buy one of the star ships in Star Atlas. It's worth about $30000, and he doesn't know what you'll be able to do with it in game yet, but he knows it's going to be important. Tracey: [00:14:05] We were just saying earlier that Craig and I were also looking at buying one of these ships a few months ago. We wish we had. Then we looked at how much they were, and then we kind of looked down at all the other cheaper things we could buy. And there were smaller ships and smaller ships and then were like, we could buy. A poster is like half A. If I really like the look of Star Atlas, too, and I'm going to keep an eye on that one, I think the graphics on it look amazing. And I'm not even a gamer and I'm saying that. So it looks super cool. But the two that you guys have just Covid off then are games in the true sense of the word. We're I'm going to tell you a little bit about something called Decentraland, which is another metaverse. Like, like we explained earlier, this is like digital land. So virtual property is something that is hugely popular right now, and some people think that this might one day become larger than the real thing. And Decentraland is the biggest player in this space right now. It's very, very popular, and this is a community owned virtual land that's built upon the Ethereum blockchain. It has a bunch of parcels of land that exist as NFTs or nonfungible tokens, as we've explained in last week's NFT episode. So each parcel of land is different, as it is on a different part of the map of Decentraland, and each one of these parcels of land can be customised or built upon, like in the real world. And there are different plazas and different districts, and some of these are owned privately, or some of them are owned by the Decentraland community. So users can buy and sell on these parcels of land, they can set up their own little shops where they can buy and sell goods that are, you know, wearables and there's shopping centres and malls and art galleries. You know, NYC's even got a store there where you can buy your own virtual Nikes and you can take those Nikes that you've just bought back to your own plot of land where you might have built a little gallery and you can have these on display and you can even bring your other NFT like Craig. If you've got your seal with a bandana, you can bring that into Decentraland and put that there on the wall in your little art gallery with your Nikes. So all items in Decentraland marketplace use Mana Token to purchase in here, and this currency also is used for voting within the community. So Decentraland became popular also because of Covid when it Covid hit last year because you couldn't do any in-person meet ups are basically impossible. So they were hosting a lot of different events inside there, and Decentraland and Binance actually teamed up to fight the pandemic and do a bit of a fundraiser, and they were selling in-game wearable face masks. Craig: [00:16:49] This sounds like a lot like Sims Tracey. Are you saying it's pretty much like a decentralised virtual sims where you can buy and show off stuff? Tracey: [00:16:59] You know what? I'd love to say that I know what Sims is completely. I've heard of Sims, but I don't know what the game Sims is like. Craig: [00:17:06] You know Sims. Blake: [00:17:07] I know Sims, and it's probably quite similar, but I've never played it. Tracey: [00:17:10] So is that what Sims is? Craig: [00:17:11] Yeah, Sims is literally like you have like a virtual world on PlayStation and you just like, like build shit and like, raise a family and shit like it's really, Tracey: [00:17:22] yeah, oh my God. Like, I see it advertised. Like, I see it pop up everywhere and like people talk about seems like World of Warcraft in that way, you can. Obviously, yeah, maybe. So Decentraland is is huge. Like, you've got the auction house, Christie's bought land in there, like no Portland that everyone's buying land in there. It's gone mental. And the Token Manor has had a huge pop up in the last six months, you know, because to interact in there, you need to use the manor token. Yeah. So that's Decentraland, which is, you know, is hugely popular. Craig: [00:17:50] What happens when the land or runs out, they Blake: [00:17:53] can build more? The idea of having a decentralised game is that you can, you know, as long as there's community participation, the world can keep growing. Tracey: [00:18:01] Yeah. And what I was saying, too, is with those with the community tokens and voting rights, you can decide to change the boundaries of someone's arguing about boundaries. You can change the boundaries of the district. If someone wants to put a casino in their district and they're not licenced for that, you can, you know, it's like a real little community. You know, it's it's madness. Craig: [00:18:20] So these casinos in there, can you actually do shit with real money? Tracey: [00:18:23] Yeah, 100 per cent. Which is why the Mana token, it keeps going up and up. Even when we're, you know, we're having pullbacks, Mana keeps going up, you know, Craig: [00:18:31] so you can you can go into a casino in Decentraland and gamble with the Mana token Tracey: [00:18:36] right now. That is Craig: [00:18:38] crazy. Tracey: [00:18:39] I know it's madness. It's the Wild West. So look, there you go. We've got Star Atlas Alluvium and Decentraland that we've kind put off. You just there. Today are excited to introduce a new segment to the podcast, the listener question. We really loved reading the feedback we received via our podcast at Get Bamboo Io email address. So thanks for taking the time to write in. This week, we're going to reply to a listener named Tom who writes, Hey guys, I'm struggling to get my head around stating, What is this? How does it work? What are some of the risks? What are some of the benefits? My crypto platform offers this feature? Thanks for writing in Tom. So Blake, do you want to give us a summary on staking? Blake: [00:19:28] So yeah, that's a really good question, and staking means that you earn a stake in the network and you're basically lending your computing power to secure the network. So there's two ways in which you can secure the network. There's mining, and the staking. Mining means that you don't necessarily have to have a stake in the network to be able to secure it, whereas with staking, it means that you do have to earn some tokens in the network in order to secure, and this creates different incentives. And if you're lending your coins and processing power to secure the network, you get rewarded in native token. So if you have 32 Ethereum, you can stake on the Ethereum network. But there's also staking pools where you can pull your tokens with other people to reach the 32 Ethereum threshold. So then you can stake together and then share in the rewards. And I think at the moment, if you take your Ethereum, you can get about four percent per annum on the amount that you stake, which is a great way of generating passive income. And it works really well because it creates incentives for those that hold Ethereum to also contribute to the security and the processing throughput on the network. Craig: [00:20:48] I must also add on to that, which should be what are some of the risks? I think the risks of staking from a financial perspective is you've got to pay a fee to stake and a fee on stake. So, you know, if you are planning on staking 50 dollars worth of Ethereum and the staking fees $10, then you are already 20 percent down. So you got to stake for five years to get that back. So I think it's just thinking about weighing up the fee in and out before getting into it. Tracey: [00:21:19] Thanks, guys. Hopefully, we've cleared that up for you, Tom. But if it still doesn't make sense or you want some more resources, we'll link some further reading in the show notes below. And that's it for today's episode. Please keep the questions coming about what you want to know about crypto and send us an email at podcast. I get Bambu IOU or follow us on social media. All those details are in the show notes below, and don't forget to write us and review us on your podcast app. That's really important. Thanks for listening. I'm Tracey. Blake: [00:21:50] I'm Blake. Craig: [00:21:51] I'm Craig. Tracey: [00:21:52] See you later!