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IVS Beta CEO Summit : Play-To-Earn and YGG SEA
In the previous article of this series, we looked into the growth and importance of stablecoins. In this article, we will examine the play-to-earn (P2E) sector and the role that our portfolio company YGG SEA plays in it.
First, Evan introduced what play-to-earn is, as well as how it differs from traditional games. He said that play-to-earn is relatively new, so if you haven’t heard about it yet, you are not too far from when it was first created. Essentially, prior to play-to-earn games, e-sports is the only field where people can actually play games and earn money.
If you think about traditional video games, you probably have played thousands of them over the course of your life. You know at the end of a game, you end up just stopping - the character you developed and the equipment you upgraded cannot be traded openly.
But with play-to-earn, video games are now incorporated with blockchain technologies, and players can own NFTs that can be openly traded in the economies that the developers set up. Players are also able to earn a steady income from just playing video games - from as little as 3 hours a day.
He then went on to talk about these NFTs as in-game assets:
Let’s take one of the more popular games out there right now which are linked to play-to-earn. You have Axie Infinity which is essentially a team of 3 Pokemons, and you can play and battle other players with them. And through this, you can earn the in-game currency, which can be used to upgrade the characters that are NFTs and that will essentially become more popular, more powerful and more rare as you breed them.
However, in order to play these P2E games, players need to buy the respective NFTs up-front. And as the price of such assets increase when the games become more popular, some games may become inaccessible for many players. Guilds like Yield Guild Games (YGG) are the solutions to enable more players to participate in these play-to-earn games. Essentially, a guild is a community that purchases NFTs and rents them out to its players.
Evan then shared what YGG SEA is, as well as what it does:
YGG SEA is the first sub-DAO of Yield Guild Games, which became very popular for over the past 6 months for being the leader in the industry of play-to-earn. YGG SEA operates for all the Southeast Asia outside of the Philippines. YGG SEA essentially leverage the tech of YGG and focuses on on-boarding these players throughout Southeast Asia.
Evan also touched upon why Southeast Asia is such a huge opportunity for YGG SEA and for the P2E industry. There are around 655 million people that are largely in developing nations where there is low economic growth and few opportunities to generate a steady income - especially with Covid-19. YGG SEA really excels during this time period, as anyone can play these games at home.
To participate in play-to-earn games, one of the first things you need is to create a MetaMask account. Interestingly, 4 out of the top 10 countries with the most MetaMask accounts are within the SEA region, with the Philippines being 1st, Vietnam being 3rd, Indonesia at #9 and Thailand at #10. This demonstrates the huge opportunity of growth solely from a population perspective.
We have set up offices in Malaysia, Thailand and Indonesia. We also have offices here in Taiwan and Singapore. And what these offices do at a local level is to essentially help the on-boarding process.
Evan shared the process of on-boarding their scholars and how they help localize the process:
We classify the players we lend the in-game assets to as “scholars”. We buy the NFT assets and do the KYC on these scholars. We bring them on-board, teach them how to use a MetaMask and introduce the games to them in their local language. All of our discord servers are in local languages, and our local community managers are there to on-board them and make them comfortable the whole process.
Lastly, he also discussed about the current obstacles for YGG SEA:
I think that the main problem is really that we have an overwhelming amount of players that want to come on-board immediately. And we have to buy all of those NFTs to get these players onboard. That’s why we just closed out last round funding of $13M and will be doing an IDO on Copper Launch in 2022.
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