# Lost in Wonderland

Source: https://web.archive.org/web/20230607045207/https://www.ranmo.me/blog/lost-in-wonderland
Kiwi News: https://news.kiwistand.com/stories/Lost-in-Wonderland?index=0x657c4435de7fa3d2afff59819f4acdf6af9c715f4592920783132dc9894f4da9273ba236
Submitted by macbudkowski.eth on 2023-12-15 UTC, 2 upvotes, 0 comments

## Summary

Crypto gaming projects are losing sight of their actual customers, the players, and the article argues that developers must build for players rather than token holders, speculators or land buyers. It contends that governance tokens are mostly bought by investors, speculators and lenders who do not play the game, which introduces competing masters for the team. Virtual land mechanics, such as plots near the spawn point being worth more, are cited as creating barriers to player discovery and engagement. The article points to Nintendo and Riot's League of Legends as examples of long-term value built around players.

## Article

In Lewis Carroll’s classic Alice in Wonderland, Alice falls through a rabbit hole into a strange land, where among a host of other characters, Alice meets the Cheshire Cat. In this encounter, Alice asks the Cat which way she should go.

"That depends a good deal on where you want to get to," replied the Cat.

"I don't much care where" said Alice.

"Then it doesn't matter which way you go," said the Cat.

"-so long as I get somewhere," Alice added.

"Oh, you're sure to do that," said the Cat, "if you only walk long enough."

This exchange is strangely symbolic of our moment in time with the “metaverse” and web3 (crypto) gaming industry. The psychedelic landscape of Alice in Wonderland is not the only parallel to many crypto gaming projects; the strong sense of directionlessness, of needing to get somewhere but not fully comprehending where to go, sometimes feels pervasive within the industry.

Enduring companies in any industry are shaped by a strong sense of their North Star–a deep understanding of who their core customers are and how the company provides value to those core customers. Ask most crypto gaming projects who their core customers are, and the answers would be the “player community”. The reality is a lot more complicated.

A player is someone who plays. It’s quite a simple definition that’s often lost these days. Players play because games provide them with senses of achievement, enjoyment, belonging, immersion, community, and more. They are willing to pay, either upfront or throughout the play experience, in exchange for the value the games provide to their lives.

The starting point of many crypto gaming projects is to issue a governance token, often with the notion that it provides the “player community” with ownership and control over the game. This assumes that everyone who owns these tokens outside of the team and institutional investors is part of the “player community”. But of course, this is not true. Often these issuances are purchased by investor communities (decentralized or otherwise), speculators, crypto asset lenders, and other stakeholders. The common thread between these stakeholders is that they are most often not players, for the simple reason that they do not play the game.

Instead, these stakeholders hold different interests when purchasing such assets, most commonly in anticipation of price increases or for the sake of yield generation, either through lending or staking. Financial reward becomes the primary interest.

For the team that supposedly builds for the “player community”, the inclusion of new stakeholders suddenly introduces a new master. The team now has to contend with traditional investors, who hold claim on the equity with vested interest in revenue and profitability, as well as a new breed of investors who hold claim on the token, with a vested interest in token price appreciation and yield generation. The complexity of balancing against these dual interests becomes more difficult to manage, and in this juggle, the needs of the actual customers– the players– become lost.

Take virtual land sales as an example. Virtual lands within crypto games are sold as plots. The idea is that landowners can “develop” these lands for players, and in turn reap the reward. Plots closest to the central spawn point are worth more than lands on the peripherals of the map, with the loosely held notion that lands closer to the center of the map will experience more “foot traffic”. This makes sense if we compare virtual land plots to physical real estate, but much less so in the context of games.

The beauty of digital experiences is that we are unconstrained by the bounds of physical limitation (how “close” we are to a certain location). We do not choose to shop digitally on the Nike or Aritzia website because they are closest to the homepage, but because they’re the best. The same logic applies to the game world: Steam and Roblox don’t surface games based on their proximity to anything, but rather on their ability to attract and engage players.

It is difficult to imagine that many land experiences are net additive to the actual customer–the players–when in many instances land mechanics erect enormous and wholly unnecessary barriers to player discovery and play experience. The purchasers of virtual land rightfully expect price appreciation over time; but true appreciation can only come through more player participation, and it’s hard to attract players with broken game mechanics.

All this puts a bind on the developers. They are locked into land mechanics and the needs of virtual land owners, but cannot simultaneously attract the players necessary to drive long term value appreciation. This Gordian Knot might be put off in the short term through grander promises of game scope and reward, but will be difficult to untie in the long term.

This brings us to the final “boss” that keeps Alice from leaving Wonderland: the developers themselves. Crypto gaming, as within many things crypto, can be extremely lucrative in the short term. The promise of a quick windfall distorts many perspectives: why worry about the long term when we can receive so much in the short term? This leads to willful ignorance at best and naked greed at worst. Vaporware, or “rugpulls” in crypto speak, is unfortunately not uncommon.

We should instead advocate for a different type of greed: long term greed. A greed to provide true value to players, and in the process, capture some of that value for the company. Nintendo focuses intensely on the player experience, and is today one of the largest gaming companies by market capitalization. The founders of Riot built League of Legends for the players, and the game still generates massive revenue for the business a decade later.

Web3 gaming holds enormous promise. It allows for the creation of true player-led economies and communities. It enables value exchanges within game worlds between players and with other participants. When we combine this ability to exchange value with the ability to create value in-game (through UGC or otherwise), the promised future is not so far away.

Yet to get there, we must be honest and steadfast on who we’re building for: the players. Not “player communities” in the vaguest sense of the word, and certainly not the enrichment of the developers at the expense of everyone else. Actual players. For players, developers, and investors, the payoff will be enormous.

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