The success of DeFi is not only due to the technological innovation of "putting financial rules on the chain", but also to the innovative operations and token economics.
DeFi's P2Pool Model#
Recently, I have seen three projects that have made excellent innovations in the operations and token economics of the entire chain game. Two of them have expanded the game matching mechanism from the previous P2P model to the P2Pool model, and the other has extended the concept of a liquidity pool to the entire chain game.
I believe that during DeFi Summer, there were actually three points of innovation.
- Writing financial rules into smart contracts, promoting decentralization and serverless operation in the industry (specifically referring to the backend).
- In order to solve the on-chain inefficiency of the matching mechanism, the P2P model has been expanded to the P2Pool model. For example, AAVE initially used the P2P model of order book, but later changed to the lending pool model. Similarly, exchanges have also upgraded from the order book model to the AMM model, greatly improving the efficiency of transaction matching. For a detailed analysis, you can refer to my article "What is the 'AMM Moment' of the entire chain game?".
- Token economics. In order to be compatible with the matching mechanism's token economics, DeFi projects will have liquidity mining in the form of a liquidity pool.
P2Pool Model for Entire Chain Game Matching Mechanism#
The matching mechanism is a very important mechanism in games and is widely used in various turn-based games, including board games, card games, gambling games, strategy games (SLG and RTS), and most of them are based on the P2P (peer-to-peer) model.
Its main functions include:
- Fair competition: The matching mechanism ensures that players are paired with opponents of similar skill levels, which helps provide a balanced and fair gaming experience. This balance is crucial for maintaining the competitiveness and attractiveness of the game.
- Game progression: In turn-based games, the matching mechanism can pair players based on their skill levels, game experience, or game progression. This ensures that the matches are both challenging and fun.
- Learning and growth: By playing against players of different skill levels, players can learn new strategies and skills, thereby improving their gaming abilities. This gradually increasing challenge helps maintain player interest and motivation.
- Reduced waiting time: An effective matching mechanism can reduce the waiting time for players to find suitable opponents, thereby improving the smoothness of the gaming experience and overall player satisfaction.
- Social interaction: The matching mechanism helps facilitate social interaction, as it allows players to play with different people and potentially foster new gaming communities and friendships.
- Maintaining game freshness: By matching players against different opponents and strategies, the game can continue to provide fresh and different experiences, preventing the content from becoming monotonous.
Currently, in the entire chain game, due to the performance limitations of the blockchain, either a room-based system (manual P2P) is used, where players choose their opponents themselves, or a simple matching mode is used, which is off-chain matching.
P2Pool Model of Mods Protocol#
Mods Protocol (@modsprotocol) recently borrowed the popular P2Pool model from DeFi and proposed the PvPool model for the entire chain game matching mechanism.
Let's take the classic game of "Rock, Paper, Scissors" as an example.
In a traditional on-chain "Rock, Paper, Scissors" game, there are generally two design patterns.
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Player A needs to create a room first, and then player B selects player A's room on the page to enter the PK.
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Off-chain random matching mechanism, where players only need to click the "Play" button, and the game will automatically match two players for PK.
Mods Protocol allows players to mint the rock, paper, and scissors props. After obtaining the props, players have two options: -
Stake them in the pool and enjoy a share of the pool's bonus. The number of props in the pool is public and can be seen by anyone.
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Use them as game props to participate in the game.
Let's focus on the gameplay of the pool. When a player participates in the game, the rock, paper, and scissors props they use will compete with randomly selected props from the pool. The winner will receive the opponent's props, and vice versa. In the case of a tie, the props will be forcibly staked in the game and a package will be generated. As the opponent, the player who stakes props in the pool can not only enjoy the staking rewards but also win the player's props, which will also be directly staked in the pool.
P2Pool Model of Sky Strife#
Another project that uses the P2Pool model is the popular Sky Strife.
Sky Strife (@skystrifeHQ) is a fully on-chain real-time strategy game (RTS) built using the MUD engine. It is developed by Lattice's internal game designers and developers. The gameplay of Sky Strife is similar to other real-time strategy games. Taking a four-player map as an example, after the start, the four players are located in their respective main bases at the four corners of the map. The players' goal is to compete for more resources to produce soldiers and ultimately eliminate other players. The resources in the game are represented by Gold, denoted as "g". Players can consume Gold in their main bases to produce units with different attack power and movement speed.
Currently, Sky Strife has only released the ORB token on the testnet as the "Entrance Fee" for establishing game rooms. All players start the season without any ORB, so the initial matches are initiated by the "Sky Pool" smart contract based on a certain rhythm. Apart from playing games to win ORB, there is currently no other way to obtain ORB. In addition to the operations related to setting up game rooms (setting entrance fees, prize pool distribution, etc.), the "Sky Pool" smart contract does not have permission to perform any operations related to the ORB token, such as withdrawal or transfer.
Similarities and Differences between the Two Models#
From the analysis above, we can see that the essence of the P2Pool model is actually the "game between real players and smart contracts". In DeFi, it is difficult to match and match real trading counterparts, so it is necessary to aggregate the liquidity provided by liquidity providers into a pool and let the smart contract represent this pool to act as a counterpart to real users, thereby improving the efficiency of matching. In the entire chain game, the matching of real game opponents also faces the problem of low efficiency, so the smart contract can also represent a pool and act as a counterpart to real users. There are two advantages to doing this:
- Providing sufficient counterparties. For turn-based games, many times we find a lack of sufficient opponents to match when we want to play a game. The pool/smart contract can provide a sufficient number of counterparties.
- Relatively fair token distribution model. The common distribution model for governance tokens in DeFi is that users obtain corresponding tokens by providing liquidity to the pool. In the entire chain game, users can obtain tokens by providing props to the pool or playing games in the pool.
When we take a closer look at Mods Protocol and Sky Strife, we can find that there are significant differences between the two.
Let's first recall the situation in DeFi. On the one hand, when liquidity providers deposit tokens/token pairs into a liquidity pool, LPs increase the liquidity of the pool. When users come to the pool for borrowing or trading, they actually reduce the liquidity of the pool. In Mods Protocol, players need to provide props to the pool, which I call Props Providers. They increase the playability of the pool, and real players and the pool are counterparts to each other. The pool in Sky Strife is different. First, players do not need to provide any game props. Secondly, this smart contract only opens a room for players to play against each other. So the multiple players entering the room are counterparts to each other, making this pool more neutral.
Asset Pool Model of Anome#
In addition to Mods Protocol and Sky Strife utilizing the concept of a pool to optimize the matching mechanism, Anome also attempts to introduce the asset pool gameplay from DeFi into the entire chain game and innovate in terms of token economics.
Anome (@Anome_Official) has recently developed a TCG game and their idea is to combine the game with DeFi. Players entering the game do not need to directly purchase NFT cards, but instead stake stablecoins to obtain corresponding NFT cards. NFTs of different rarity require staking different amounts of stablecoins, and of course, NFTs can be exchanged back to stablecoins at any time, ensuring the interests of players. This allows players to "buy and sell at any time" in the game. Since they do not make money through NFT sales, where does the game development team make profits?
One way is during the early stages of game development, the issuer allows game users to stake stablecoins to obtain NFTs, gradually building up a fund pool, and then generating DeFi income through the fund pool to support the gradual development and improvement of the game. Once the game is developed and has playability, players can "spend" and "consume" in the game to earn profits, which will benefit the game development team and early NFT holders. During this stage, the funds staked by game users in the fund pool can continue to generate DeFi income.
In simple terms, the funds attracted through game traffic will form a staking fund pool, which can generate profits through financial and in-game spending, completely avoiding the pure Ponzi token paradigm, and can earn funds from outside the system, creating a hybrid of Game+DeFi.