If you keep up with investment opportunities, you likely already know about NFT games and the immense promise they have.
Axie Infinity and CryptoBlades are two of the most well-known games right now. In addition to being fun to play, NFT games allow you to build your NFTs within the game.
Those NFTs, in turn, can be collected, traded, or sold—often for serious cash.
What are NFTs?
Before getting into the nitty-gritty of NFT games, it would be best to define what NFTs are first.
Non-fungible Tokens (NFT) are tokenized versions of real-world or digital assets.
To get one thing immediately out of the way: an NFT is not a stock. For more detailed information on stocks, we suggest an investing in stocks workshop to start.
NFTs can be anything: photos, videos, or any other digital file. You can trade, collect, and purchase them, similar to stocks.
However, unlike stocks, NFTs cannot be traded like shares. You either possess an NFT or you don’t. An NFT cannot be broken down into pieces. NFTs are unique and non-divisible digital assets that represent ownership over an underlying asset or item.
NFTs are “minted” on the blockchain, usually on Ethereum. Once you mint an NFT, no other NFT—past, present, or future—will ever be the same.
Two NFTs can look identical, for instance, but no NFT collector will confuse them for each other. NFTs are never the same after they’re minted.
This is because of an NFT’s metadata. Buying an NFT means more than just buying a token. On top of the token, an NFT’s owner also gets all the data in that NFT. That NFT’s specific metadata serves as your guarantee that you—and only you—own that specific that NFT.
There are also NFTs minted on other blockchains, but the main marketplaces for NFTs generally revolve around Ethereum.
The use of blockchain technology prevents anyone else from copying an NFT. While it is possible to snag a copy of an NFT for cheap (or free), it wouldn’t count for much, since the original NFT will always have its owner listed on the blockchain.
What are NFT Games?
At its core, NFT games are simple: they are video games where you can create your own NFTs. It’s entirely up to you what you do with your NFTs from there: you can sell them, trade them, collect them—anything you can do with an NFT.
If you want to get into the burgeoning NFT market but don’t have enough cash or know-how to buy an NFT you’re happy with, playing an NFT game should be a good way to get started. NFT games could even be a great opportunity for you to invest in NFTs.
How Do NFT Games Work?
There is no one set of rules for NFT games.
Some NFT games like Axie Infinity function like digital collectible card games, while others like CryptoKitties, which plays like a monster collecting game—but with cuddly cats instead of scary monsters.
Each game has its way for players to earn tokens and contribute to its economy. Most NFT games are “play-to-earn”. That means having to spend money to make money. Though it is possible to grind your way to success with these games once you are in, it is impossible to start without putting in a hefty investment.
Axie Infinity, for instance, requires you to make an upfront purchase of three “Axies” to form a Starter Team. Once you have your Starter Team, you can start earning Smooth Love Potions (SLPs) by completing daily challenges and facing off against both AI- and player-controlled teams.
SLP is itself tradeable on several exchanges.
But you could also use it to breed more Axies, which will put you in a better position to win more against the AI and other players. The more you win, the more SLPs you can earn.
SLP is an ERC-20 token, which basically means that its value is tied to Ether, the cryptocurrency of the Ethereum network.
The same principles apply to CryptoBlades, but instead of SLP, you earn SKILLS. You can also sell your SKILLS outright or use them to improve your in-game performance, helping you earn even more SKILLS down the line
Other NFT games operate more like a lab to create your own NFTs.
CryptoKitties, for example, allows you to develop cat NFTs. Some aspects of how your NFT cat will look and behave will be random, but you will be able to put your stamp on it to make it truly unique.
You can form your own clowder of NFT cats for pleasure or profit—it’s entirely up to you.
When you want to cash out, you will have to list your NFTs of tokens like SLPs and SKILLS on a market, auction house, or crypto exchange.
NFT games can be a great way to invest in NFTs, but it is important to know what you’re getting into before investing anything other than time and effort.
Losing money on NFT games is all too common nowadays, with so many beginners jumping into the fray. But as long as you can keep your head about yourself and do your research, NFT games could be a great place to start your journey into the NFT world.