Why most NFT projects and games FAIL
I see a lot of people going on and on about new NFT projects promising to take them to the moon. However, a more accurate description of what actually happens most of the time is, they crash into the moon, shattering to pieces.
That is the unfortunate NFT project blueprint that proves to be true almost every single time: the developers oversell their project, hype gets built up, and prices rise all the way up, followed by a stagnation and then a plummeting of the prices, as hype slowly dies down. All this leads to the game (or project) dying and the community being unhappy.
But why does this happen so often? Well, first off, let’s take a step back, and remember that the blockchain, cryptocurrencies and NFTs are all a pretty new thing. Except for Bitcoin and a few other tokens that are just over a decade old, most currencies and NFTs did not exist until a few years ago, so it is only natural that the blockchain environment is full of newbie mistakes because, well, we are all newbies here. Still, that does not mean that we should just give it some time, as a lot of things can be fixed right now.
Where most projects fail, I feel, is the sustainability of their tokens and reward systems. The crypto industry has been advertised to the general public, broadly speaking, as one of two things:
- A way to get scammed
- A way to get rich quick
So, whoever is uneducated in the field but wants to get involved in it, obviously started to see (1) as false, leaving him/her, probably, with the belief that (2) is true. While there are lots of cases where people got rich overnight with crypto, those are definitely the exceptions, not the actual rule.
That being said, that’s the reason that developers feel forced into an unsustainable model: because most people expect to get rich quick, and they will not consider a project that does not promise just that.
We see how this happens and how these projects fail over and over again. Just to prove a point, let’s take a look at some examples:
Just to be clear, I am not saying these projects are good or bad or anything really, I just want to show you that the pattern here is self-explanatory, and exactly what I stated in the intro. Hype comes and goes, and swings the price with it. What the games in the pictures have in common is an economy that excessively rewarded the players, promising a ROI (return on investment) of weeks or even just a few days. I think you can see how that quickly becomes a problem, because you cannot realistically have an economy where everyone just earns their initial investment back every other day.
It’s funny really, how people always complain about inflation when talking about fiat currency, yet don’t seem to be bothered when thousands or tens of thousand of tokens are printed every hour so they can have their 3 days ROI.
So, where am I going with this? Well, there are multiple problems with NFT games and projects at the moment, but I can’t address them all in a single article. For example, the economy and the tokens should be made in such a way that is self sustainable, with multiple token burning mechanisms and with a sensible approach to the reward system. However, these are things that the developers of the projects need to think about, and I am not trying to reach the developers with this post. I am trying to reach the users and players of these projects, and you may just be one of them.
How can you help this mess that is the crypto industry at the moment? Have realistic expectations. It’s as simple as that. Think about it, if we are talking traditional investments (think stock market for example), an APR (annual percentage rate) of even 10–15% is considered to be very good. That becomes even less if we are talking real estate. So, consider yourself lucky that you are here for the crypto revolution, but tamper your expectations at least by a bit, so developers don’t have to resort to promising such extreme returns just to get people to try out their project. Let’s not be the ones that ultimately kill this industry that we are trying to build.
Thank you for reading!
Make sure to follow for quality posts like this one regarding anything from traditional investments, blockchain projects and fitness!