Until recently, there were two main models of monetization for games: pay-to-play and free-to-play. However, a new model called 'play-to-earn' has started to become popular. Here's a quick overview of how the economics of gaming have changed over time.

Paid Games/Pay-to-Play (P2P): The Origins of Video Games

Arcade games in the early 1970s operated on a pay-per-play model, where players paid a small fee to enjoy a few rounds of a game. This was highly profitable. When home consoles arrived in 1972, game developers introduced a single payment model, allowing players to pay once for complete access to a game. Examples include FIFA and Super Mario Brothers. Later, subscription models were introduced, where players paid a regular fee to maintain access to all parts of a game, particularly in MMORPGs like Tibia, Runescape, and World of Warcraft.

Free-to-Play Games (F2P)/Freemium: A New Chapter in Gaming

In the free-to-play model, players have free access to the core of a game but are encouraged to spend money on enhancements, such as additional playing time or an ad-free experience. Initially, mobile games followed the premium model, where players paid upfront for the game. However, in 2009, in-app purchases were introduced, allowing players to buy digital items within free apps. This prompted a shift towards the freemium model, as seen with popular games like Angry Birds, Temple Run, and Plant vs. Zombies. Video games like DOTA 2 and Team Fortress 2 also adopted the free-to-play model while offering purchasable cosmetics.

Play-to-Earn (P2E) and the Rise of GameFi

In 2017, blockchain games like CryptoKitties became popular, introducing the play-to-earn economic model. In these games, players can monetize their time and in-game assets, usually represented as NFTs. Unlike traditional games, players have ownership and control over their digital assets, contributing to game decisions and shaping its future. Fairy Cat GameFi is an example of a blockchain game where players collect, breed, and train creatures called 'Fairy Cats' that can be traded for real money on the game's marketplace. In this game, players earn the native cryptocurrency, USDT, through their gameplay.

It's important to note that games like Fairy Cat may require an initial investment. To start playing, users must adopt one pet character, and building a team in the first stage may cost around US$30.

Overall, the evolution of game monetization models has allowed for different ways to enjoy and profit from gaming, with play-to-earn becoming an intriguing option in recent years.