The X-to-Earn model: Eat, sleep, do almost anything and get paid in crypto

The X-to-Earn model: Eat, sleep, do almost anything and get paid in crypto

Are you a good runner? Or eater? Or sleeper? Chances are whatever you’re good at, there’s a Web3 project out there to reward you in crypto. But do the tokenomics stack up?

Axie Infinity — a non-fungible token-based online video game that’s generated over US$4 billion in secondary NFT sales — is credited with kicking off the so-called “play-to-earn” (P2E) craze, allowing gamers to earn money while playing. While the Axie hype has somewhat died down, it also spawned a series of copycat projects that pay users to perform everyday activities.

These projects have developed into an industry of their own; a sort of “X-activity-to-earn” (X2E) model, now including tie-ins with brands from Asics to European soccer clubs, paying users in cryptocurrency for running, eating or even sleeping.

Perhaps not surprisingly, questions are being raised about the economic principles many of these projects are founded on.

“The problem with some of these X2E models is that it seems like a really good innovation, but then it is just purely a Ponzi [scheme],” said Anndy Lian, author of the new book “NFT: From Zero to Hero,” in an interview with Forkast, though he did not mention any by name. “And it’s actually very disturbing, to be really honest.”

Without ongoing revenue to support what is being paid out, Lian said, the X2E model risks becoming an unsustainable compensation structure, relying on the hope that more people will come in to “pay” for the tokens that were previously dropped.

There were similar accusations leveled at Axie Infinity after a period of explosive growth failed to generate earlier returns for its users, as its native token SLP is now trading at US$0.004 at press time after reaching as high as US$0.41 in May 2021.

Running tokenomics

One of the more popular variations of this new industry model is the “Move-to-Earn” (M2E) project StepN, which pays users in cryptocurrency for walking, jogging or cycling by tracking their movements via GPS on their phone.

To participate in the project, users buy NFT sneakers and hold them in their wallets on their phones when they go for a walk and are then compensated for the exercise in the project’s native currency, Green Satoshi Tokens (GST).

Users then cash out GST for profit or invest it back into the project to mint additional NFTs for other users to buy.

Brian Lu, founding partner of investment fund Infinity Ventures Crypto, is more optimistic about the outlook for these projects than Lian, however, telling Forkast in an interview there are ways such projects can be successful.

“There’s always going to [need to] be people to support the token or the token has to have some type of utility [for the project to work],” he said.

StepN does this by allowing users to cash out their GST for profit or by investing it back into the ecosystem to mint more sneaker NFTs. This was the tokenomics model initially adopted by Axie Infinity, which allowed users to cash out their SLP or to re-invest it back to create more “Axies” — Pokémon-like creatures that players bred and battled to earn more SLP.

After launching in December, GST reached a high of US$9.03 in late April before the crash along with the rest of the crypto market in May. Despite tie-ins with sports-brand Asics and Spanish soccer club Atlético de Madrid, GST had fallen to under US$1 by early June, and has been trading under US$0.10 since early July.

Sleeping on the job

Positioning itself in direct response to the Move-to-Earn projects, Gang Azit Social Club (GASC) has taken a different approach, and wants to remind users that it’s important for one’s mental health to take a break and relax from time to time, and incentivizes this practice by paying them to do just that.

Calling itself a “Relax-to-Earn” project, GASC detects when users are within a predetermined zone using GPS and pays them in the project’s HIPS token if they press a “relax” button on their phone while in the space.

If anyone needs an incentive to eat, Esca — an online marketplace for food consumers and vendors — promises to pay customers, restaurants and at-home chefs in both Bitcoin and USDC. According to its website, Esca thinks the commissions charged by most food delivery platforms are too high and is using cryptocurrency to balance the equation.

So many projects have popped up promising to pay users to sleep that there is even its own category of finance for the industry — SleepFi.

The Sleepee app pays users based on their sleep quality score in its native currency, which can be converted to buy products or services in their store. Even the Move-to-Earn app MetaGym offers a SleepFi feature that pays users in its native token that can be spent in-app or cashed out for USDC.

The future of Web3 and gaming

Measuring the success of these projects over the past few months has been difficult amid the broader crypto downturn, which has seen even well-established crypto funds and businesses file for bankruptcy or needing a bailout.

If the situation doesn’t improve soon, Lu says there are other options available to such projects.

“These X2E projects that are coming up [are] going to start learning to advertise their users and their user’s behavior [and] user data to marketing companies that are willing to pay for it,” said Lu, explaining this process will become more commonplace as brand tie-in continues to gain traction.

Selling user data may seem against the ethos of Web3, which is often touted to offer a new incentive model to break away from the data mining method of business which has led to massive wealth concentration from a few giant tech companies.

Back to the genre that started it all, Lu says the industry has learned its lesson from the short-lived success of Axie Infinity and is shifting from Play-to-Earn to Play-and-Earn, or Web 2.5.

These projects are putting gameplay back at the center of the game, with the option to earn money — sometimes even in fiat — a bonus element rather than making a game whose main draw card is earning.

Lian is hopeful these types of games can still survive in the meantime, but says it will be a long time before the mainstream gaming industry adopts Web3 in any meaningful way.

“I don’t think the super app is coming anytime soon,” said Lian, who explained the technology is there but the US$300 billion a year gaming industry has little incentive to change. “[Game studios] might not be agreeable to how it is actually going to help them since they are really making millions of dollars in revenue every year.”

 

Source: https://forkast.news/x-to-earn-model-eat-sleep-anything-paid-crypto/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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As Bitcoin price briefly goes above $20,000 mark industry observers say, ‘Don’t get happy too early’

As Bitcoin price briefly goes above $20,000 mark industry observers say, ‘Don’t get happy too early’

As per reports, a brief rise in crypto price was witnessed in the last 24 hours and sentiment has temporarily improved.

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

j j j

Stablecoins Are Here to Stay – And Regulators Must Get On Board

Stablecoins Are Here to Stay – And Regulators Must Get On Board

The recent collapse of the TerraUSD algorithmic stablecoin has put the popular crypto asset in the spotlight. And its repercussions are only just starting to be felt, from talk of government regulation from US Treasury Secretary Janet Yellen, to Tether temporarily losing its USDT 1:1 peg to the dollar, to an all-time low of US$0.95, and with investors withdrawing more than US$10 billion in the past two weeks.

Kathleen Breitman, a co-creator of the Tezos blockchain, speaking to CNBC on the topic said: “As much as I relish seeing things that don’t make sense fail, there’s always a tinge of like, ‘Are people going to extrapolate from this that everything that’s a stablecoin is unsound?’”

At the same time, a statement from the G7 on May 20 warned that “no global stablecoin project should begin operation until it adequately addresses relevant legal, regulatory and oversight requirements through appropriate design and by adhering to applicable standards.”

Despite recent events stablecoins remain a necessary and popular part of the crypto ecosystem.

Despite recent events stablecoins remain a necessary and popular part of the crypto ecosystem. In a October 2021 report from DBS – Singapore’s largest bank – recognized that “Stablecoins have gained momentum” while also noting concerns about stablecoins to withstand high volatility. In fact, Singapore is no stranger to stablecoin innovation, with the launch of the XSGD pegged to the Singaporean dollar in 2020 by StraitsX, with a market cap of almost US$200 million and records over US$1 million in traded volume on a daily basis it’s the world’s largest non-USD fiat-backed stablecoin. I’m also impressed by the Jarvis Network, which has its own set of stablecoins collateralized with USDC, including SGD in late 2021.

These innovations support Singapore’s leading role as a regional crypto hub, with government and startups working in partnership.

Even after the Terra crash, stablecoins still have a total market cap of over US$160 billion, according to CoinMarketCap, with market leader Tether currently worth around US$73 billion, having surged from just US$4.1 billion at the start of 2020.

That said, Tether has not escaped the current slump unscathed, having lost US$11 billion in vale since its US$84.2 billion on May 11. In a statement on Monday May 23 Tether sounded an understanding note, welcome in the current situation, acknowledging that following its loss of peg that “it’s natural that investors might have questions about what stops USDT from facing a similar fate.” But confirmed it had US$70 billion of collateral. I agree the strength of Tether, compared to most traditional banks, has been its ability to process withdrawal of 10% of its assets in a few days.

Check the fine print

Despite these “collateralized assurances,” the data shows crypto whales leaving Tether for USDC. Not surprisingly these whales regard USDC, as the safer option, bearing in mind USDC reports its assets monthly. However, those same whales might want to check the small print.

Circle claims that each USDC is backed by a reserve dollar, and other “approved investments”, these are not detailed. Indeed, the wording on the Circle website changed from the “backed by US dollars” to “backed by fully reserved assets” by June 2021. The third most popular stablecoin, BUSD, created in 2019 as a collaboration with Binance and Paxos, which grew in market cap of around US$1B at the start of 2021, to over US$14.6 billion at the end of 2021, and is now up to over US$18 billion is I believe another winner from the Terra crash, due in large part due to the security involved with the token. As both regulated by the New York State Department of Financial Services, and publicly audited very month, its likely to benefit from the demand for secure stablecoins going forward.

I’m also heartened by the positive post-Brexit approach to stablecoins from the UK government, which clearly recognizes that stablecoins are here to stay, and we need all governments and regulators to get behind that fact.

As an industry we also need to recognise that algorithmic stablecoins are a “different kettle of fish.”

But as an industry we also need to recognise that algorithmic stablecoins are a “different kettle of fish.” I concur with Chris Burniske’s assessment that while it’s unwise to think they’ll never be a workable algorithmic stablecoin, if such an asset needs to either go up or stay stable to work, then it’s not going to survive the crypto market.

Let’s also not forget in the push to get mainstream adoption of crypto that that also raises the risk of contagion to the wider economy. The problem is if the folks who got hit hardest, the retail investors, who bet on LunaUSD because they were told it was “safe”, decide to pull back from other assets.

That said, a balance needs to be struck in terms of protecting investors, the risk in investing in altcoins is different from that with stablecoins. I’m in agreement that regulation needs to happen, but a balance needs to be struck, in protecting investors, and which also allows for rapid innovation which is key to the success of the crypto industry.

 

Original Source: https://blockhead.co/2022/05/29/stablecoins-are-here-to-stay-and-regulators-must-get-on-board/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

j j j