Hive & Splinterlands Predictions For 2023

I have been making a habit of trying to predict what will happen in the Hive and Splinterlands ecosystem by the end of the new year. These are my thoughts right now...

Looking back at 2022 Predictions

At the time last year when making the predictions (Link) there was still a bullish sentiment with bitcoin sitting around 50k Dollars, Hive at 1.5$ and SPS at 0.22$. Pretty much everyone and their mother expected things to continue going up for a while longer which couldn't have been further from reality. Bitcoin right now is sitting at 16.5k (-67%), Hive at 0.252$ (-83%) and SPS at 0.023$ (-90%).

This made it so that pretty much all my predictions were totally wrong. I thought Hive could have a small increase in price to 2$ by the end of the year. I was also way too optimistic about Splinterlands thinking that a million active daily players maybe could be possible while in reality, the majority of the 300k players at that time were just bots trying to extract value. DEC completely collapsed from 0.0049$ to now 0.0006$ below peg and Chaos Legion packs turned out to have way too big of a print now needing packs to be burned instead of selling out within a couple months which I kind of expected. The expectation of land to finally come out never came through and it looks like it is still some time away while the next big card set is only half a year away.

However, the devs continued to work hard on the game and it was still possible to earn quite a bit from it when playing it smart and not taking owned card values into account. The game itself also has become more fun for me and there is a much bigger community right now with many youtube channels (Link) extensively covering the game on a daily basis. The game mostly has a core audience who loves it with little to no mainstream adoption outside of the crypto space.

Where Splinterlands is Currently At...

So basically what it comes down to is that the Devs (and everyone else) highly overestimated the actual adoption of the game and they printed everything (Cards / DEC / SPS / Vouchers ... ) into oblivion while overhiring making it so that their expenses are unsustainably high even after laying down 40% of the staff. All this at a time when SPS holders were supposed to start getting more use case in that part of the revenue would go to SPS Holders. Since the Company needs the revenue and they have a lot of DEC sitting around, they kind of switched the narrative around toward this "Flywheel" mechanic where SPS needs to be burned to mint DEC. They try to do everything that they can to get DEC closer to peg (with ridiculous proposals like DEC-B) which is currently failing as it takes away value from SPS and cards in the short term which pushes everything down as it's the main way to get rewards now with a lot of selling pressure. All this while the new user experience is just totally off and needs a lot of work. Land also keeps getting delayed as they got the money from that years back before the start of the bull run so there never was any rush to it. All of this leaves the economy in a very bad state right now and many players lose trust and are dropping out. So 2023 will likely all about trying to fix the many things that are broken. The game is in a negative economic spiral and this pretty much needs to reach a bottom so it can start to reverse into a positive spiral again.

2023 Predictions

On to some predictions for 2023 now...

General Crypto Expectation

Pretty much everyone is bullish at the top and everyone is bearish at the bottom. The general consensus is that prices will go a bit lower at least at the start of 2023 with eventually a bottom being reached to see a new bull market. Off course, things rarely happen the way the majority expects them so either it will be way more bearish as the Recession hits hard or it will be the other way around where everyone that tries to catch the bottom misses out on it. Personally I don't mind as I believe crypto has a bright future and I continue to grind and accumulate as much as I can while keeping my expenses as low as possible.

Hive

Splinterlands helped to give Hive some more adoption since players need some hive for Resource Credits especially if they are putting assets on the rental market. Hive itself by now has a core audience which is not going away and some future prospects with some new games that will be build on it. Altcoins that survive generally have a 95% drop which would make hive botton out at around 0.17$ which perfectly matches previous bottom wicks.

As the timeframe this would potentially play out, I have literally no idea. just for the fun, I would say at the end of 2023; hive has a price around 0.80$

Prediction: Hive Will Survive and Bottom Around 0.17$

Splinterlands

The general Sentiment around Splinterlands is pretty bad right now as it is in a negative price spiral where decreasing SPS and Card Prices make players quit the game which puts more pressure on the prices and so on.

Card Prices

The value of all cards in circulation came down a lot despite the fact that a crazy amount got printed. These are Chaos Legion Packs, Riftwatchers Packs, Promo Cards, Runis, & a shitload of reward cards. All this printing was based on the belief that the influx of new players would continue toward 1 Million players which never happened. The situation is way worse than the chart shows as it doesn't account for all the extra cards in circulation. So a crazy amount of extra cards and a big decrease in their overall value.

That being said, Card prices were crazy inflated at the top and will likely get to a point if not already there where they are highly undervalued.

Prediction: Prices of cards will go down more first and go up again later in the year

Low Returns on Land Expansion
It would be pretty ridiculous if land doesn't come out in 2023. The way I see it right now is that the devs already feel they have given value to those that bought into the land sale and they will try to use the entire expansion as a crazy sink for DEC & as a way to lock up a lot of cards to the point where the returns players that own land can get won't be that high since the added cost will be so high.

Prediction: the extra costs to mine Spells and Items on Land will be so high that returns will get crushed on them.

SPS Usecase
The problem right now is that SPS has little to no use case aside from players that want to buy Riftwatchers packs needing 5$ in SPS + 1 Voucher for each one. This on top is a mechanic that devs tried to change turning it into a DEC requirement that would benefit them more. This however got shot down by the community proposal similar to the proposal on the validator nodes

I do fear that they will continue their direction of wanting this flywheel where SPS Gets burned to mint DEC to be the main SPS use case instead of giving it proper use cases. There are so many things that they can do like allowing SPS delegation and giving players that have SPS staked a chance for the new Soulbound Reward Cards to turn into real reward cards base on their stake.

Prediction: The Team Continues their Direction toward the SPS Flywheel Usecase which won't see any effect yet in 2023

Switch from Botfarms to Real Players Botting

Botfarms have been a real issue and there have been many measures to make them earn less. I think this fight will continue making it even harder for those who just try to extract value from the system to do so even if the economy recovers. The game for real players however is just way too time intensive to the point where I believe most players will use a bot service like Splintermate, Archmage or Splex Rentals as they are pretty much forced to in order to get proper rewards. Right now these have become very accessible and once you have them on, it's just easy to let it run instead of playing yourself.

Prediction: More Bot Farms will close & more real players will start using Bot Services

Tower Defense & Genesis League Sports

When it comes down to the new Tower Defense game and Genesis League Goals, I at best can see them as mildly successful at the start mainly because the loyal playerbase of Splinterlands will get into them. Aside from that there will likely be a lot of growing pains and a lot of difficulties to aquire new players unless the market sentiment around crypto and Play2Earn totally shifts.

Prediction: Mild Early Success with lots of Growing Pains in 2023

Land Card Supply Shock
I do believe that land will act as a major supply shock for the game pushing card prices higher especially for the cheapest reward cards and likely also the summoners. The entire point of land will be to give older and bad cards more use-case while the cards that are strong and fit into the Meta will just continue to be used to play the game itself.

Nftyarcade Will Grow in Popularity

I expect nftyarcade.io which is a platform that offers new players to start off without a big upfront cost to grow a lot in 2023 and it might become one of the primary ways for new player acquisition as their platform does not allow bots.

Rebellion Power Creep
So the next card expansion is set to release around 6 months from now already and it will make no sense for players to get into it after they got totally crushed on Chaos Legion. I don't think that the team will adjust the number of packs and the prices which will make the main way for packs to be sold to introduce a lot of Power Creep into the cards. This way, players that want to win will need these cards since they are stronger. Even with the power creep, the sales likely will be rather disappointing.

SPS Price
With SPS being the main Reward token that has little to no use case, the price has continued to dump after it got crazy inflated because of the early staking reward APYs. The valuation however has gotten to a point where the token has become cheap assuming Splinterlands survives the bear market with the token getting a lot more use case. Just based on the 2+ Million Riftwatcher packs that remain and eventually will get sold and go for 5$ in SPS each. That would mean at current price 460 Million SPS would get locked up into the DAO which equals 15% of the total supply that will ever be available and 53% of the market cap of coins in circulation currently.

More use cases also need to come and in the worst case it's just this Flywheel mechanism that will start to get into play if the team manages to get DEC back to peg. For this current valuation reason, I'm quite bullish on SPS as a buy-and-hold for 2+ years at this point. The returns are also not that bad as the GLX airdrop still has a long way to go

Prediction: SPS is close to the bottom and will be higher by the end of 2023!

GLX Price

GLX to me is one of those cases where a token gets value purely from speculation without a product or users yet. The staking mechanics that offer crazy returns early on also make it that the price of the token starts off crazy high followed by a long downtrend as returns become lower creating less demand and more selling pressure from people that got in an managed to mine a lot. Right now the price of GLX is 0.031$ which at a 2 Billion supply represents 62 Million. I expect this to continue to go down to 10 Million in 2023 or so which means a 80%+ drop from here on out.

Prediction: GLX will drop below 0.005$

2023 will be a Year of Opportunity
While most of my outlook is quite negative around Spintlerlands, I'm quite sure that it will survive this bear market creating a similar scenario to 2020 which was a year where all prices and rewards were really low with whales getting out. This exactly showed to be the time where everyone that continued grinding and accumulating did extremely well. I do see another adoption cycle happening even though prices might not go as crazy as last time probably in 2024. The team also continues to work hard on the game with the best intentions even though this conflict between company revenue and value for Players & SPS holders will continue to be present.

Conclusion

Pretty much everything right now in Splinterlands looks quite bad which usually is the time to start pushing and shoving if you believe the game will survive the bear market. While I do expect 2023 to be a year with more pain and lower prices, the point of the reversal should also come at some point for things and the sentiment to become much more positive again getting the game in an upward spiral. Those that get in the game in the first part of 2023 and the ones that keep grinding will eventually be rewarded, those that quit now will likely end up regretting it.