Many people enjoy playing video games, but while it is quite possible to monetize your hobby, it is quite difficult. Fortunately, with the development of technologies like blockchain and NFT, it has become feasible to make money playing recreational games. How? With the help of GameFi projects. So what exactly is GameFi? How are GameFi and cryptocurrency related?
What is GameFi?
So what is crypto gaming? GameFi is a combination of games and finance. Creating this type of game involves game mechanics, blockchain technology, and NFT.
Conventional video games are usually owned by developers who have all the rights to them. Gamers don’t actually own their in-game items, such as clothing or weapons, which are unlikely to have any real value outside of the game, and therefore the player can’t make any profit from it. The only way to monetize games is by streaming or participating in tournaments.
GameFi projects come in many forms. Players can get valuable items even outside of the game by completing tasks, competing against other players, or completing levels of the game. This model is known as “Play-to-Earn.” Players are often rewarded with some sort of NFT or tokens that they can later trade on NFT trading platforms and crypto exchanges.
The ability to trade virtual items between users and transfer them between platforms is possible thanks to decentralization and NFTs. These technologies are founding new types of ownership.
The GameFi industry is booming today. Many investors are backing these projects because of their great potential.
Now that we have learned what GameFi is, let’s talk about how this technology works.
How does GameFi work?
After knowing what GameFi is, it is interesting to finally find out how it works. The concept behind it is a new one, although it is quite promising. Get valuable items, represented as NFTs, by playing games. You can monetize these items in-game or on the NFT trading platform. The rewards depend on the game, difficulty, tasks and some other parameters.
Another opportunity that GameFi provides to gamers is to generate passive income by saving, borrowing or receiving assets.