Opinion by: Tobin Kuo, founder and CEO of Seraph
Play-to-earn (P2E) enjoyed a fleeting moment in the spotlight, but that moment has passed. The excitement stemmed from financial rewards rather than genuine gameplay, resembling more of a job than a fun experience.
That said, the trials were not without value. They demonstrated that wallets could function as controllers, assets could be transferable, and communities could co-manage the environments they cherish. However, the reliance on subsidies skewed design choices toward exploitative mechanics. The cycle became one of extraction: recruit, inflate, cash out, and repeat.
As the audience dwindles alongside diminishing rewards, the motivation to keep playing wanes. It’s time to let P2E fade away quietly, without unnecessary tributes or mourning. This decline shouldn’t be viewed with fear; rather, it marks a natural phase of exploration, serving as a filter that compels developers to create games engaging enough to thrive even if their tokens become worthless.
Gaming finance (GameFi) needs to discard outdated thinking and mechanics, learn from past mistakes, and take three straightforward steps: emphasize the play aspect, minimize the earning component, and give the genre a real opportunity to flourish.
The painful truth
P2E set the stage for GameFi to prioritize the yield from tokens over the essential purpose of play: enjoyment. The result has been fragile economies undermined by designs that extract pleasure at every turn. The unpleasant truth is that incentives have often overshadowed the gameplay itself.
As player retention plummeted, funding streams dried up, tokens fell in value, and projects crumbled under pressure. The data is stark: blockchain gaming funding plummeted by 93% year-over-year in Q2, and daily unique active wallets also saw significant declines.
Related: Burn the tokens, keep the loot: Play-to-own games come next
Over 300 Web3 games ceased operations, highlighting the shallow nature of player engagement when rewards no longer justified the effort. It was a harsh realization, but it brought clarity.
Games offering little more than token emissions are either dead or facing extinction, leaving builders to pick up the pieces of P2E and start anew. It’s time to develop systems that genuinely entertain.
Regulatory scrutiny adds another layer, opening the door wider to a much-needed reality check for GameFi. As clear boundaries are established around games prioritizing financial gain over fun, P2E projects, largely functioning as extraction mechanisms, risk being classified as gambling.
Take India’s legislation against money-centric online games, which subjects “earn-first” models to scrutiny whenever they pose risks to consumers or veer into gambling territory. This doesn’t signify the end for onchain gaming; it merely compels developers to create games with real purpose rather than mere profit motives.
Developers of P2E games must confront the uncomfortable truth: no more exploiting player engagement for profit, no more empty hype. It’s time to focus on authentic gameplay. Let’s build.
Ownership without extraction
The necessary corrections are evident in the Q2 statistics. Funding is drying up, and gimmicks designed to boost retention are failing to convince. Games developed using mere spreadsheets and emission timelines lack genuine long-term vision.
The future lies in creativity, not exploitation. It involves crafting worlds where seasonal resets introduce value in novel ways, where items are earned through effort, skill, and persistence, not shortcut purchases.
A robust system embraces scarcity as a design principle—moments, achievements, and artifacts matter precisely because they cannot be endlessly replicated. The notion that players primarily seek alternative income streams must be discarded. Games should not be financial tools but spaces for creativity, competition, and community.
It’s time to bid farewell to play-to-earn without regret and acknowledge it as a detour rather than a destination. The industry’s true progress will arise from a return to the core values that have consistently driven exceptional games: joy, mastery, and meaningful play.
The commitment to forge the next remarkable generation of games will not stem from token mechanics or speculative loops, but from honoring the player-first ethos that has always propelled this medium forward.
Opinion by: Tobin Kuo, founder and CEO of Seraph.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
