For many of us, COVID-19 has dramatically changed the ways we work and what we imagine work can or should be.
One of the biggest impacts on work culture has been the widespread shift to working from home. Two years into the pandemic, it seems likely that virtual meetings and home-office set ups will remain normal for some time in most white-collar jobs. Alongside this, there have been so many people switching jobs during the pandemic, in the Global North, that commentators have heralded a ‘great resignation.’ Allegedly, this great resignation is driven by COVID-19 prompting a reassessment of priorities and/or by experiences of being poorly treated by employers during the pandemic.
Less discussed, though, as a compensatory labour culture to emerge from the pandemic, is the rise in people making careers from pay-to-earn gaming. In fact, a lot of people probably don’t even know what pay to earn gaming is or that it exists. Pay to earn gaming belongs to the world of Crypto, which, although rapidly becoming a huge part of socio-economic life globally, is only hazily understood, if at all, by the majority.
Generally speaking, pay to earn games are games built on the same blockchain technologies that enable crypto currencies. Often, these games are part of metaverses; virtual realities that can be explored with an avatar. Many metaverses exist, but the concept has recently come to forefront of public attention via Facebook’s rebrand to become ‘Meta.’
In pay to earn games, players are financially rewarded for in-game success; either with pay outs of cryptocurrencies or by gaining NFTs (non-fungible tokens). Within gaming, NFTs equate to digital assets that can be used and sold and can even generate passive income. NFTs in games can include, for example, a sword in a fighting game that becomes more valuable as you win and can be sold to other players, or a sports stadium in a virtual universe that generates an income stream from spectator fees when virtual sports are played in it. The biggest pay to earn game at the moment is Axie Infinity; a trading and battle game, but there are countless others. These range from large scale projects like ‘Sandbox’ – a huge virtual world where you can buy virtual land, create and sell any kind of NFT, and even design and monetize in-metaverse mini games for other Sandbox visitors to play - through to the much simpler virtual horse racing game ‘DeRace.’
Most of these metaverses and games operate using their own crypto currency. A common ‘tokenomics’ model is to have an in-game crypto token that players use to trade within the game world and an out-of-game currency that can be traded on cryptocurrency exchanges and swapped for Fiat currencies. Usually, you need a given amount of the out-of-game currency to convert to the in-game currency and start playing and must convert the in-game currency back to the out-of-game currency to take your earnings.
Pay-to-earn gaming has become so lucrative that many players now generate their main income this way. According to the Cyrpto news broadcaster Coindesk, average players in Axie Infinity can earn around $800 USD a month. There have been many reports of people quitting their ‘real world’ jobs to make a living from pay to earn gaming.
The rise of pay to earn gaming is largely driven by people in the Global South. For Axie Infinity, the vast majority of players are from the Philippines and Venezuela. In these countries, the pervasiveness of low and precarious incomes – and, sometimes, the instability of national Fiat currencies - means that pay to earn gaming can be a genuinely more lucrative and stable way to make money. This is true even though most crypto currencies are currently not well established or recognised by traditional banks and currency exchanges, making their value highly volatile. (Rather than being regulated by a centralised institution, crypto currencies are verified and secured through peer-to-peer interactions on a decentralised blockchain network, creating an open-source ledger to record and legitimate transactions and their value.)
During the Covid pandemic, pay to earn gaming has exploded in popularity, as many non-virtual jobs have become untenable. In the Philippines, months of strictly enforced lockdowns prompted many people to turn to pay to earn gaming to pay bills and buy food; as documented in this short, YouTube documentary.
Pay to earn gaming has become such a large industry that management and sponsorship groups have set up to fund the entry costs of crypto gaming for players in return for a cut of profits. For example, Yield Guild Games (YGG) is a ‘players’ guild’ in the Philippines that manages nearly 5000 players and takes 30% of each player’s profits.
With so many now making a living from pay to earn gaming, game designers are starting to build in specialised in-game career paths. For example, the space exploration strategy game ‘Star Atlas’, according to their white paper, creates ‘branching revenue streams for players to contribute to and establish a career. From trading raw and refined ore, to cargo hauling, to crafting retail components, there is a broad range of career choices a player can embody and advance within the specializations of that career.’
Given that the COVID-19 pandemic is still radically restricting face-to-face interactions, and that the concept of metaverses and in-metaverse earning is becoming more mainstream (e.g. with the rebranding of Facebook to Meta), it seems likely that this compensatory work culture will only become more prevalent in years to come. We may see a future in which its commonplace to earn a living and forge a career within virtual spaces. This makes it pressing to examine the political economy of metaverses and pay to earn gaming. While blockchain technologies are decentralised, there are still clear centres of power within crypto. At present, multiple companies are competing to make their blockchains and their metaverses the most prominent. By the time the industry is widely understood its power structures may well have solidified, leaving little scope for intervention from those who weren’t aware of it early on.