The Guilds at GameFi

Last week I was meeting with my colleagues from the Plei Games project, they are a DAO (decentralized autonomous organization) that invests in blockchain video game assets that generate a return through gamers, NFTs and cryptocurrencies. Their goal is to create an interconnected community of gamers, backers and token owners, acquiring properties in multiple virtual worlds while generating yield.

With them I have had several very interesting conversations about what to consider when investing in a blockchain video game or a Guild.

But what is a Guild? This concept is not new to the blockchain gaming ecosystem, but is a term that comes from traditional gaming. Much like their traditional counterparts, GameFi guilds are an organized group of gamers that often work together in-game to complete missions. Though, whereas traditional guilds solely served as a community, GameFi guilds add monetary value to a player’s gaming experience.

Guilds are very popular or necessary in massively multiplayer online role-playing games (MMORPG), and some games like World of Warcraft is almost indispensable to belong to one of them.

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The importance of Guilds in GameFi

From the collaborative goal of the Guilds in traditional gaming, we have moved on to the main goal of earning money. Ventures Capital has seen the great investment opportunity offered by Play to Earn games. For this reason they have invested a lot of money in the purchase of the NFTs of the games, and not only to own them but to be able to attract millions of players through the scholarships.

At this point we return to the pioneer, Axie Infinity. It was this blockchain “video game” that launched the concept of scholarships, which allows holders of in-game NFTs to “lend” them to players who don’t want to buy them or can’t buy them, in exchange for a percentage of their earnings. From there, an ecosystem of figures is created around the scholarships, where new roles appear, such as managers and even scouts.

But the Guilds are not only important for the generation of income, but also for the communities that they are creating and that are so important for the games, because if they do not manage to have a critical mass of players, they will end up disappearing due to the great competition that exists in this sector.

These communities are communities in which players will share information about the game, form teams or clans, among other things.

And as I mentioned at the beginning of the article about Plei, they are decentralized autonomous organizations, DAOs, with large capital to invest in NFTs and new games.

And the next step will be to evolve into the professional management layer of blockchain games, looking to attract the best players and the biggest partnerships. At this point in the evolution of the Guilds, we see a tremendous resemblance to current eSports clubs, is this the future of them? I think we will see points of collaboration between both “organizations” for mutual benefit.

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Some of the most important Guilds

Top 3 Guilds by market capitalization and number of scholarships they move:

  • Yield Guild Games. This Guild is focused on blockchain video games and metaverses. Their market cap, at the time of writing, is $329 million and they hold their YGG token. Manage more than 4600 scholars (2021) and has investments in video games such as Axie Infinity, Illuvium, Start Atlas and The Sandbox.
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With such a large community, it is not surprising that it is one of the most influential Guilds. Regarding its organization, it is not 100% a DAO since each of the different video games is managed as a sub-DAO. The main management is not decentralized.

  • Merit Circle. Like YGG, Merit focuses on blockchain video games and metaverses. Their market cap, at the time of writing is $221 million and they have their MC token. It is a DAO that manages over 2750 scholars, has over $124 million in assets and investments in video games such as Axie Infity, Illuvium, Big Time, Sidus or Sipher.
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  • Blackpool. It is not the third largest by capitalization according to CoinGecko, but I wanted to comment on it. Unlike the previous two, on their website they define themselves as a fund that operates in the NFTs industry. Their market cap at the time of writing is $24 million and they have their BPT token.

It operates as a DAO that manages more than 600 scholars, more than $17 million in assets and has investments in video games such as Axie Infity, Sorare, Guild of Guardians or Cometh.

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In my opinion Blackpool is primarily a Fund, which has a Guild. Speculating with NFTs can be very lucrative, but also very risky.

Other Guilds to keep in mind and on the radar are GuildFi. Good Game Guild, Avocado Guild or Polkastarter Gaming Guild and of course Plei Games, which is doing an amazing job.

In Summary,

From Belobaba we believe that Guilds are big business and it is clear that everyone is trying to position themselves now, before the launch of blockchain AAA games. It is possible that some of these Guilds are overpriced, too much exposed to video games that are not clear about their survival over time, but you have to look at the benefits through in-game rewards, NFT sales and other revenue streams, to see who has the best setup.

In the long term I believe that player Guilds will grow and evolve and as I said, they will reach agreements with other players in the gaming sector. It will not be uncommon to see Guilds integrated into eSports teams or vice versa.