Simon Yee of Clam Island says that GameFi is moving thousands of participants who are using such platforms to make their first crypto purchases.
If paying attention to charts and data is a turn-off when it comes to managing your finances, you’re not alone. If you have thought about earning double digit yields using crypto then this is what it is. But you are intimidated by the complexity of using a decentralized finance (DeFi) platform.
These barriers to crypto entry are formidable. They have left a large number of curious onlookers on the sidelines, while a relatively small group of pioneers and skilled businessmen reap the rewards.
GameFi Could Destroy Crypto
Thankfully, this is now beginning to change due to the rapid development of GameFi. GameFi can help people understand crypto finance through an intuitive and visual world of gaming. GameFi could be the bridge that leads to more widespread crypto adoption in the coming years. This is while globally taking people the first step on the financial ladder.
GameFi’s unique selling proposition is simple – it’s fun. There is much more to be said about the seriousness of traditional finance and the complexity of DeFi. This holds an especially powerful appeal to the younger generation who grew up playing the game.
By setting game-play tasks – whether it is winning battles, mining precious resources, or taking care of digital crops and creatures – the GameFi ecosystem really engages participants. And it can educate them about lending and borrowing strategies that can yield higher returns.
defy without pain
GameFi is essentially DeFi without the pain. DeFi comes with a lot of jargon and complicated transaction methods that can be worrying and difficult to understand even for financially literate investors. GameFi relieves users of that stress. This enables them to benefit from potentially high-yielding strategies such as yield farming. They can do this by having fun as they compete with other players and try to hit milestones.
GameFi also has a lower entry cost compared to DeFi. Such fees can quickly eat away money through multiple transactions and high gas fees on a blockchain like Ethereum. For a few hundred dollars or less on a blockchain like Binance (which is known to have low transaction fees) you can enter the GameFi ecosystem and start playing investing.
gambling finance
The GameFi platform has often used the classic role-playing model to simplify finance in Web3. But the new Tokenomics innovations have a lot in common with the classic board game Monopoly.
The participants are effectively acting like real-estate developers. They are acquiring assets and then deploying them through strategies that generate income and add value. Unlike Monopoly, however, it is not a winner-takes-all deal. Each player is on his own journey to build his wealth based on a mix of skill, dedication and smarts.
Certainly, GameFi is not a risk-free proposition like any investment. The assets held by players are exposed to the same volatility that affects the broader crypto markets. They are also vulnerable to changes in user trends that prefer some games or blockchains over others. Participants should be prepared to lose some of their investment as they increase their skills and knowledge. And of course, the region is not immune to rag-pulling by unscrupulous founders. It’s a risk that was uncovered late last year when the Squid Game coin fell into a scandal.
But that risk can be avoided by taking some basic precautions on the GameFi protocol before making a deposit.
safe passage
Ecosystems that are managed by a DAO and identify founders with relevant experience to deliver on a project’s roadmap can help address those risks. The GameFi Project alliance with a governance coin and a shared treasure can be a powerful way to create incentives and avoid a rag-pull scenario as the community builds for their common good.
GameFi and Wider Adoption
The DeFi revolution mainly attracted existing crypto enthusiasts. But GameFi has the wide adoption the industry has been waiting for. GameFi is already pushing hundreds or even thousands of participants. Many of these will be using such platforms to make their first crypto purchases.
According to a recent report by DappRadar, blockchain gaming activity grew 2,000% in the first quarter of this year compared to a year ago, accounting for 52% of blockchain activity.
When we pull back the lens to look at the world beyond North America and Europe, GameFi’s transformative potential is even more dramatic. In less developed countries, where millions do not have a bank, the Gamified Experience is giving participants the opportunity to hold and grow their first financial asset of any kind.
In Southeast Asian countries like the Philippines, the immense popularity of GameFi is changing the age-old notion of video gamers from time-wasting layouts to productive young entrepreneurs who are able to support their families through their online adventures.
This ability is one reason we’re still very early on in the GameFi story.
About the Author
Simon Yee’s Chief Development Officer is clam islandA massively simplified way to earn returns in decentralized finance.
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