This article elaborates on how to select GameFi “potential stocks” projects
The earliest application of the term GameFi was outside the field of encryption. It was an innovative financial services company that aimed to use interesting ways to improve the efficiency of corporate employees. Since then, the two original styles of game and finance The unrelated words began to be inextricably linked.
But when word came GameFi encryption field, it will not just referring to “Game + Finance”, it means “Game + DeFi” .
People in the DeFi world have long been dissatisfied with traditional mining projects. After pledged LP, they waited boringly. They began to integrate mining into the game, which not only lowered the threshold for newcomers to enter the game, but also brought more to liquid mining. Lots of fun.
Even Andre Cronje, who is now “calling the wind and calling the rain” in DeFi, once predicted that in the future “GameFi” may become the development direction of DeFi’s monetary policy.
Four months ago, the news that ” Axie’s single-day revenue crushed “Glory of Kings” became a new outlet” exploded in the crypto circle, and then various GameFi projects followed one after another, dazzling investors, then investors How to screen for potential GameFi projects?
As we all know, when making investments, you must often screen many projects. If you choose a good one, you will get considerable benefits. If you choose a bad one, you may suffer heavy losses. Investment is like a marathon, not how fast you start, but whether you are running on the right track.
In the mirrored world of investment, choice is more important than effort, and the height of cognition determines the wealth you can have.
1. The emergence of GameFi makes investors shine?
First of all, the fun of gamification in GameFi attracts users who do not want to understand the complex technology of DeFi projects.
They don’t have to understand the code, logic, and mechanism of the DeFi project, they just need to figure out how this “game” is played, neither brain-burning nor boring.
Secondly, GameFi has given retail investors more opportunities to enter the market.
For traditional mining projects, the amount of benefit depends on the proportion of the provided LP in the entire mining pool. Therefore, the large investors who enter the market early will often make a lot of money, while the retail investors have little profit and will risk the big ones. The risk of unpaid loss caused by selling.
Turning mining projects into “games” brings more opportunities for retail investors.
2. What is the flame that ignited GameFi?
Before May of this year, the overall DeFi market and its excellent data have always attracted the attention of investors.
However, since the second quarter, NFT games have grown rapidly, and the GameFi field, led by P2E (Play to Earn) game Axie Infinity , is more active than ever.
With the astonishing rise in the price of AXS, the concept of blockchain games has completely become popular. The word GameFi has begun to appear frequently on the Internet. At this time, industry insiders have clearly felt that GameFi may bring to the entire blockchain game industry. A disruptive change .
Slowly we realized that P2E is a sign of igniting GameFi .
This time, the Play-To-Earn model is not only changing the game world, it also allows the blockchain to quickly enter the lives of ordinary people, and it is accelerating the introduction of game mechanisms in the DeFi and NFT fields.
We see a trend: the next generation of encrypted assets will maximize the financial properties, playability, and Meme characteristics at the same time.
3.Four perspectives of potential GameFi projects
The current GameFi projects can be roughly divided into two categories, one is to further expand the game based on the traditional mining mode, and the other is to directly make the mining process into a game.
The former usually requires staking tokens or LP and then supplemented by NFT to provide gains, or directly staking the project’s NFT; the latter allows users to play a game on the ground, just like people’s daily games, but gains Game props can be sold for profit.
In discovering potential stocks GameFi:
A look at the issuance of tokens
The issuance of tokens mainly includes two parts, the distribution situation and the lock-up mechanism.
First of all, the distribution situation refers to the official plan of how to distribute tokens in the white paper. The most important points for ordinary players are the ratio of the official to early investors and themselves, and the amount of tokens to be distributed to players.
Second, the lock-up situation refers to how long the official plan to distribute tokens. The core concern is the token lock-up that the official reserves for itself and investors.
Second look at the deflation mechanism
The deflation mechanism refers to whether the official will burn and repurchase, so that the entire game economic model will be deflationary in the long run, which is very important for the ecology of the game.
The deflation mechanism is mainly divided into two parts:
The first is the important deflationary means of the combustion mechanism. It is best to have a fixed combustion mechanism in the game to keep the entire game economy deflation for a long time.
The second is the repurchase mechanism. The repurchase mechanism is the official tokens obtained from a certain way, and they will be distributed twice or directly destroyed by certain means.
Three look at Play To Earn
The Play To Earn mechanism is the most important means of making money for players.
Four look at the public chain track
The public chain track is also a relatively important indicator. The characteristics of the public chain may naturally conform to GameFi.
Meta universe tips: reasonable distribution model
The team and investors accounted for 30%~40% (set up a lock position for about one year, and release linearly in 2~5 years)
DeFi mining or NFT mining accounted for 20%~30% (gradual release, gradient reduction)
Play To Earn占比20%~30%
Market share 5%~10%
4. Select high-quality GameFi tips
As an institution or ordinary investor, how to confirm whether a project is worth investing in, when to buy and sell, can be judged by the financing situation, token distribution, and chip analysis.
First , we must first pay attention to the project financing situation, including the completion of several rounds of financing, financing institutions, financing time, and financing amount.
Among them, the lead investor is particularly important. A good lead investor can bring traffic and heat to the project, and even participate in the design and iteration of the economic model of the project. We can also take the past successful experience of the project party and the team as an important observation point.
In addition, pay attention to the timing and amount of financing, such as a bull market and a bear market. The amount of financing for different projects is different.
Second , make a preliminary judgment on the initial circulation of the project by understanding the token distribution and release rules of the project.
Third , mark and track the currency holding addresses of project parties, investment institutions, exchanges, and retail accounts. First, according to the creation records, the detailed addresses of the project parties and investment institutions are determined and labeled.
At the same time, we need to focus on the following points when analyzing a GameFi project:
Project team information : If the founder has blockchain industry experience and game industry experience, then it is basically certain that this is a team with great potential.
Partners and investors : If a well-known venture capital participates in the investment, it will also add a lot of visibility and credibility to the project.
Community influence: If the project has high community influence on platforms such as Twitter, Facebook, Reddit, etc., it can be considered that the early launch of this project will be relatively smooth.
Project white paper: The white paper will introduce the token distribution mechanism of the entire game, including whether it is a single currency system or a dual currency system. After some experience in the Axie project, we believe that the dual currency system may be a better way to simulate the entire real economy cycle. .
The economic model of the game: This is the most important point. We must go through the economic model of the game and confirm whether there is a problem with the logic of this model.
Game guild participation: From the perspective of the Axie project, the blessing of YGG is very important, so if there is a game guild like YGG to participate, the credibility and attention of this project in the circle should be relatively high.
Project business model: that is, how the project party makes profits. These profit methods are directly reflected in the value of the project’s tokens and platform currency.
With the future development, more new high-quality projects will continue to emerge on the GameFi track, and there are many opportunities that are worthy of attention and participation. However, remember not to invest blindly, you need to conduct a comprehensive inspection of the project before measuring whether to participate.
Pacific is a decentralized NFT marketplace and an integrated platform for metaverse/GameFi assets. The project has received endorsement from some of the most eminent institutions and investors, including the Web3.0 Foundation, NGC, Gate.io, Krypital Group, PAKA, Candaq etc.