Play-to-earn (P2E) gaming — where players earn cryptocurrency or NFTs with real value through gameplay — was one of crypto’s most hyped narratives in 2021-2022 and one of its most criticized by 2023. The core question that haunted the sector: where does the money come from? If players are “earning” by playing, someone must be paying — and in most P2E games, the answer was “new players joining,” which is the definition of a Ponzi scheme.
Axie Infinity was the poster child. At peak, players earned $200-$500 monthly breeding Axies and battling. But the economy required constant new player growth to sustain rewards. When growth slowed in 2022, token prices crashed 99%, and millions of players who had invested in Axie NFTs lost their income. The same pattern played out across dozens of P2E games: STEPN (move-to-earn), Thetan Arena, CryptoBlades, and others all experienced boom-bust cycles driven by unsustainable tokenomics.
The industry learned painful lessons and evolved. “Play-to-earn” was rebranded as “play-and-earn” or “play-to-own” — deemphasizing earning as the primary motivation and focusing on genuine gameplay with optional economic elements. The new model: games should be fun first, with blockchain adding real ownership (trade your items, sell your character) rather than promising income.
By 2024, more sustainable models emerged. Games like Pixels, Big Time, and Star Atlas used blockchain for item ownership without promising income. Free-to-play models with optional NFT purchases (similar to traditional gaming’s microtransaction model) replaced the “invest money to earn money” P2E structure. The successful Web3 games of 2024 looked more like traditional games with blockchain features bolted on than “crypto games” — and that was probably the right evolution. The lesson: gaming economies must be funded by entertainment value, not by the next wave of speculators.
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