What is play-to-earn?

Play-to-earn (P2E) is a gaming model where earning real or tradable value – typically cryptocurrency or NFTs – is the primary motivation for playing. Players complete in-game tasks to accumulate tokens or assets that can be traded or sold outside the game, often on a blockchain-based exchange. Some P2E games also require an upfront investment before a player can begin earnings, such as purchasing starter assets.

‍

What's the difference between play-to-earn and play-and-earn?

The core distinction between P2E (play-to-earn) and PAE (play-and-earn) is what motivates the player. 

• In play-to-earn, earning is the primary goal and gameplay is often built around repetitive tasks designed to generate rewards, which often have tangible value outside of the game and can be bought and sold on the market (e.g cryptocurrency). 
• This is different from play-and-earn, where players are motivated by the game itself and earning is a secondary benefit, with the loyalty currency earned redeemable for tangible rewards like gift cards or sweepstakes entries.
  ‍

What are the challenges with play-to-earn?

Because play-to-earn economies depend on a steady flow of new players and demand for in-game assets, they can struggle with long-term sustainability. When token or asset values decline, player incentive to continue playing often declines with it, since the gameplay itself wasn't the primary draw. Additionally, play-to-earn systems can be a priority target for hackers and fraudulent activity, as the earnings within a P2E platform do have monetary value outside of the platform. This has led some in the industry to move toward play-and-earn models instead.