Opinion by: Tobin Kuo, founder and CEO of Seraph
Play-to-earn (P2E) had its moment, but that time has come and gone. The excitement stemmed from payouts rather than gameplay, resembling more of a job than a pastime.
Admittedly, the experiments held value. They demonstrated that wallets can serve as game controllers, assets can be transferable, and communities can collaboratively own the experiences they cherish. However, it can’t be overlooked that subsidies skewed every design choice towards draining mechanics. It became all about extraction: recruit, inflate, cash out, and start anew.
As audiences diminish and the faucet drips slower, motivations to continue playing dwindle. It’s time to let P2E fade away without sentiment or tributes. This decline is not something to fear or resent; it’s a natural evolution, functioning as a filter that encourages teams to develop games that will engage players even if their native token loses value.
Gaming finance (GameFi) must cleanse itself of outdated practices and philosophies. It should focus on three essential steps: enhance the gameplay experience, diminish the emphasis on earnings, and allow the genre to flourish.
The painful truth
P2E positioned GameFi to pursue token yields instead of the core purpose of gaming: enjoyment. The aftermath reveals economies collapsing due to design approaches that strip away fun. It’s a harsh truth where incentives outweighed actual gameplay value.
As retention rates plummeted, fresh funding decreased, tokens plummeted, and projects crumbled under pressure. The statistics are stark. Investment in blockchain gaming fell 93% year-over-year in Q2, while the number of daily unique active wallets dropped significantly.
Related: Burn the tokens, keep the loot: Play-to-own games come next
Over 300 Web3 games became inactive, revealing how engagement was superficial when rewards no longer justified the effort. This was a bitter realization but ultimately clarifying.
Games offering nothing but emissions are faltering, leaving creators with the remnants of P2E to rebuild from scratch. It’s time to develop systems that genuinely entertain.
Regulation opens the door wider for a reality check: a positive step for the GameFi landscape. As clear boundaries are set around the prevalence of profit-first, fun-second game loops, P2E games, merely functioning as extraction devices, face treatment akin to gambling.
Take India’s legislation prohibiting money-based online games, targeting “earn-first” models with scrutiny they can’t evade when they verge on consumer exploitation or gambling. This doesn’t mark the demise of on-chain gaming; it simply compels developers to craft games fitting for genuine engagement rather than exploitative schemes.
Teams developing P2E titles must confront the giant in the room: abandon the exploitative designs of the past. No more hype-driven mechanics extracting from the enjoyment of games for inflationary tokens and superficial “play.” The time for authentic gaming is now. Start creating.
Ownership without extraction
The Q2 data already indicates a correction in progress. Funding is dwindling, and retention strategies aren’t fooling anyone. Games designed with only emissions in mind were never built to last.
The path ahead relies on expression rather than extraction. It’s about crafting worlds where seasonal resets recycle value creatively, where player achievements feel genuinely earned through skill and persistence, not merely acquired through shortcuts.
A robust system honors scarcity as a fundamental design element — moments, achievements, and artifacts hold significance precisely because they can’t be replicated endlessly. The notion that players primarily seek another income stream must be dismissed. Games are primarily spaces for creativity, competition, and community.
It’s time to phase out play-to-earn without remorse and recognize it as a detour, not a destination. The true momentum of the industry will stem from a return to the values that have always fostered exceptional games: joy, mastery, and meaningful engagement.
The determination to build the next remarkable generation of games will not derive from token mechanics or speculative cycles, but from embracing the player-first ethos that has propelled this medium forward.
Opinion by: Tobin Kuo, founder and CEO of Seraph.
This article serves general informational purposes and is not intended, nor should it be perceived, as legal or investment advice. The opinions expressed here are solely those of the author and do not necessarily represent the views of Cointelegraph.
