The Problems With Broken Tokenomics.
While I generally really like what's being done with the game itself, the tokenomics have been extremely frustrating. Not so much because of the current low price or the mistakes that were made, but more because the total neglect shown toward them right now and what I believe is also just lack of understanding. There are many problems that come along with broken tokenomics.
- It's impossible to promote the game: I really like the spread the word around about Mobile MiniGames as I do enjoy the game and think it has a real future. However, with the totally broken economy nobody wants to be associated with the game and promote it to their audience.
- There will be a run for the Bank by investors if things somewhat recover: Many that invested kind of overinvested in the tokens and they are so far from where they are supposed to be that nearly everyone will want to at least partially opt out in case there would be some good news and a recovery. That is including myself, if PRPS would hit 4$-5$ which is still 60% below the top, I will not hesitate to liquidate a part of my bags. For the Devs to bring back the buy-wall it's nearly impossible without them having the funds to buy up everything in circulation because everyone would dump it on them.
- Players Get Demotivated: I've seen this happen in my community and on my land where more than half of the players on my plots don't even log in daily anymore. Others stated they quit because of the broken tokenomics.
- Bad Reviews on PlayStore: The rating of the game has gone down to 4.2 start on the play store and there are more bad reviews (also because of the game crashes) the economy being broken while still advertised as 1 PRPS = 10$ in the game will inevitably lead to more bad reviews.
- ...
That being said, these times are also an opportunity to do really well with the game in case things would recover but the ones doing this are a small minority. The thing is that the Play2Earn Economy being somewhat healthy is important and this doesn't need to be perfect as boom & bust cylces are part of it. Things being completely broken as they are now however is just really bad especially since there might be ways to somewhat stabalize things...
Step-By-Step Economy Fix
Step 1: Make DUBI the Only Discount Token
The entire tokenomics model is based around PRPS to be a token that is traded based on supply and demand while DUBI is supposed to be more stable and give returns to PRPS holdres that lock. By allowing both PRPS and DUBI to be used in the store at discount price the burns don't have any impact on the price since the amount of tokens in circulation from both combined is so high. The fact that DUBI can be used at double value also doesn't do much aside from putting fuel to the fire as this just means PRPS is trading at half the price and most are still using PRPS to do in-game purchases.
If DUBI was the only token that was accepted inside the game and on the G4G Store at the discount rate, this would mean that all buying and token buring would go toward DUBI which has a way lower supply. Right now there is no real demand for DUBI and the price going down just means that PRPS goes even lower. With an increased demand for DUBI, that price should naturally go up at least a bit compared to where it is now. Even if this means PRPS would go down lower, at the same time it would give better returns closer to the buy-wall for those that are invested which to start with was the main idea of PRPS.
(I guess to give those that have locked PRPS the option to use that, PRPS could be allowed to be used close the the market price)
Step 2: Create DUBI-PRPS and/or DUBI-USDC Liquidity Pool incentives
Having large liquidity Pools is extremely important to have a working game economy. The 20k$ PRPS-USDC & DUBI-USDC Pools right now are a total joke and make it impossible to buy or sell without moving the price a lot. I dindn't understand the importance of this myself in the past and was against it when Splinterlands devs introduced giving big rewards to players that helped provide liquidity at the start, but they really showed me wrong as this was vital to their growth. Right now they still do this and have over 6 Million in different liquidity pools.
I get that the team doesn't have the funds to provide a bigger liquidity pool right now but not so much the argument that it's not safe enough. Polgon at one point had 10 Billion Total Value Locked. The only thing that needs to be done is to create reward incentives for players that help provide liquidity and this can be done with in-game progress.
Example
Give a total of 100 TTTT Vouchers each month to players that provide liquidity to a DUBI-PRPS Pool and 100 TTTT Vouchers to those that contribute to a DUBI-USDC Pool. That's roughly 240k of in-game progress for an entire year which should largely fix the current liquidity problem and it should be fairly easy to set up tracking wallets that are connected in the game that provide liquidity based on their share in the pool. The numbers off course are just an example and can be tweaked and it can be started off with fewer rewards and ramped up as the prices stabalize.
This would mean there are 2 Liquidity pools where those that Lock DUBI can take profit and get their returns or easily reinvest it, while those that withdraw PRPS from the game can easily swap it for DUBI in order to re-invest or cash out. PRPS itself doesn't need to be traded that much as it's designed as a buy and hold lock token. It should be easy to find buyers or sellers within a week or a month at the right price on Dubiex.
Another thing what these liquidity pools do is both create demand for the tokens from players that want part of the rewards and it potentially will take a lot of tokens off the market as they will be locked inside of the liquidity pool. All while providing investors and players a way to get in or out without a tiny amount of 1000$ moving the price like crazy.
Step 3: Create more incentives for players to reach higher VIP Levels
The problem with Play2Earn games is always the same, players that only aim to extract value from the ecosystem without putting anything in hurt the economy and give players that do want to invest less reasons to do so. Splinterlands has been fighting this issus for years now with nerf after nerf cutting out the leechers and bots which has been quite succesfull. Some things that Mobile MiniGames could do are to make unique Pets earned from the game Soulbound so they can't be dumped on the market (this is the main earning model for alt accounts that only look to farm). Only allowing duplicate skins or those that were bought to be sold only screws players that aim to extract value while for real players that doesn't change a thing. What also could be done is to unlock all earned pet skins for players that reach VIP Level 8 or so which gives higher incentives to reach that as at that point it allows them to sell if they wanted to. All this would create a supply shock and a rise in demand resulting in higher pet prices and earnings for players that put money into the game. Also, having some kind of VIP Level requirements or Account Crypton Value and linking them to rewards in PvP could give more incentives for players to reach higher Levels spending more money in the game helping the economy.
Step 4: Give reason for all players to own 36 Exclusive Hero Skins
Step 5: Devs Should Start chipping away buying PRPS and DUBI at market price.
It's clear that bringing back the DUBI Buy-Wall will be impossible for quite a long time to come and the same goes for PRPS to reach close to the sell-wall level. This doesn't mean that part of the profit can't be used to start buying PRPS and DUBI at market prices. PRPS that is cashed out by players for example shouldn't come from the stack of PRPS that was artificially bought up without any funds backing that up during the PRPS Level increase. Instead earnings from the game should be used if possible to buy PRPS off the market if it's below a certain price as that doesn't further increase the real circulating supply. Same could be done with DUBI at least in small parts as everyhing helps.
Step 6: Weekly Development Update + Q&A Video in the Game
Right now there is a Weekly update stream on twitch mainly to keep the people inside the building up to date. Nobodu aside from the small loyal fanbase watches these. It would be nice if there was also a weekly stream toward the players that is available in the game as a video afterward for players with a small reward attached to it to watch it potentially while playing (something like 500 Crypton to watch 15 Minutes for players with VIP1 or higher ) rThis conecpt was an idea of Freepls on COS Pro Discord. Splinterlands has done this for a long time with the weekly Town Halls and it works quite well. This also could get players more engaged with the game and the development or bring in potential investors.
Conclusion
Unfortunately I fear nothing will change and it will all be about ROAS and playing some World of Warcraft trying to get in a few more players that way while the economy completely remains neglected blaming the bear market.
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