NFT games present a new way by which players can earn value out of time and resource investment into a game. The usage of game tokens allows for a game to have its own system of value that rewards existing players and makes it affordable for new players to be on-boarded.
In addition to the conventional one token idea, two-token systems can also be used to provide players with value, driven by their involvement in the game and a say in the governance of the game whilst still allowing for inflationary movement. One of these tokens can also be exchanged bidirectionally for in-game assets. Governance say can be distributed according to value involvement in the game. This bi-directional exchange allows for a true play-to-earn model that is community oriented and creates an ecosystem of value where the community owns the value. The token should also be engineered to allow for a value withdrawal method. This means that value generated in-game can be withdrawn as real rewards without opening the system to exploitation and liquidity rugging.
These tokens should also be engineered to prioritize rewards for active involvement within the game's ecosystem. However, there should also be opportunity for passive value generation given historic activity to allow for long-term value investment. All of these threads should be captured within a framework that also provides some consideration for the free-market decisions made by players.
Within the academic fields of game theory, stochastic modelling and economics design, tools do exist by which these tokens can be represented and their design enhanced. We therefore propose the creation of a framework for token design that pulls in tools from these fields and creates a baseline for token engineering within the NFT gaming ecosystem. The creation of a such a framework would provide game creators with valuable insight into:
- How does the token scale within the game given certain market conditions?
- How can this token provide long-term sustainable value to players?
- How is this token affected by different scenarios and free market decisions and what does that do to the token’s value?
The mathematical nature of the framework would also open the door for more technical tools such as sensitivity analysis, what-if analysis and Monte Carlo simulation all of which provide valuable insights for technical design.
Play-to-earn is here to stay and could greatly benefit from some dedicated research. We also recognize that there are others within this ecosystem that could make valuable contributions so our goal is to establish the seed framework to which community experts could contribute and drive subsequent research.
By establishing a seed framework, we create a standing invitation to academics in the fields of mathematics, game theory and economics to focus their research attention towards cutting edge technology that is accessible to everyone. By creating this seed framework as an open source framework also gives anyone in the community the opportunity to continue and add value.
This proposal is inherently academic in nature and so many of the risks associated with academic research are also relevant here.
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Rabbit hole and scope creep: It is very easy to hyper-focus on a small subset of the real problem and over solve for that one nuanced problem. Likewise it is so easy for the original scope to grow to try to solve all the problems. We mitigate this by having two technical founders with formal education in both mathematics and engineering as well as experience with academic research. Along with a local University partner with committed graduate assistants. As the cliche says, this isn’t our first rodeo
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Lack of problem understanding: Academic research aims to develop new solutions to existing problems, however sometimes the problem is much larger than originally anticipated. We plan to mitigate this risk by devoting a significant amount of time toward a literature review and state-of-the-art evaluation. The results from this will be used to revise the scope of the original research task.
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Lack of Time: Arguably the biggest risk with academic research is a lack of time to be able to do thorough research and provide holistic solutions. We aim to mitigate this by providing a time risk adjusted timeline (below) as well as revising the research outcomes upon successful completion of the literature study
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Research sniping: In academics there is always a risk that someone else will take some of your shared findings before publication and create a derivative work, thereby claiming “ownership” of an idea. In a decentralized ecosystem, we plan to mitigate this risk by publishing initial results in a manner that promotes auditability, whilst still preserving record of the timeline, thereby preventing someone from running off and claiming ownership of work they did not do.
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- Subjective budgeting: Every team builds and spends differently. A risk if funded is being transparent with the community through open accounting on what we are spending. Thankfully the Catalyst team allocates awarded funds in traunches and as we report our progress every month for ongoing funding. To create accountability and offset this risk we use them as a community arbiter to review our spending & hold us accountable by withholding or delaying funds if we abuse the budget.