Monek Script Bank Releases Free Report on Blockchain Game Business Model Classification and Earnings Estimation

Monek Script Bank has started distributing a report titled “Blockchain Game Business Model Classification and Profit Estimation” that analyzes the profit models of popular games such as Axie Infinity and Splinterlands. Anyone can check this report for free by subscribing to the WEB3 e-mail magazine “wEB3 e-mail magazine by MonexCryptoBank” operated by the company. Subscribers of this report will also receive a free profit and loss calculation simulation sheet for blockchain games.

What is a blockchain game?

A blockchain game (BCG) is a game created using blockchain technology. Blockchain technology includes elements such as NFTs and tokens.

At BCG, these blockchain technologies are used as elements that make up in-game assets. , it is difficult to understand where the profit points exist for the project as a whole and where the costs occur.

The fact that it is difficult to see what kind of profit model is being adopted is considered to be a major obstacle in evaluating existing BCG and planning new BCG projects. Given these circumstances, we thought it necessary to clarify the revenue model for BCG.

This report begins by classifying BCG’s current revenue model into two categories. Each revenue model is then analyzed in detail in the form of a profit and loss statement (PL). At the same time, we will consider the advantages and disadvantages of each model based on the characteristics of each profit model. After explaining the financial accounting issues and the unique benefits of BCG, I will add consideration on how BCG should be deployed in the future.

Two types of BCG revenue model

In this report, we will consider that the “type” of the profit model can be determined by “which profit point generates the largest sales.” The reason why we did not set the classification criteria for the type of profit model to “which profit point is adopted” is because there are BCGs that build profit models by combining multiple profit points.

To classify the types of revenue models, let’s take a look at the revenue points in BCG. The current BCG is considered to have the following three profit points.

・Royalty revenue from secondary distribution on the NFT marketplace
・Sales profit of new NFT collection
・Revenue from token sale

However, among these earning points, “income from token sale” has a strong aspect as a means of raising funds, and is a supplementary earning point that does not affect the gameplay. In view of the fact that it is difficult to build a profit model on its own, we believe that “profit from token sale” should be excluded from the factors for determining the classification of profit models. The details of the token sale will be explained later as other revenue points.

From the above, it can be considered that the two revenue points used as classification criteria for the type of revenue model are “royalty revenue from secondary distribution on the NFT marketplace” and “sales profit from new NFT collections”. Therefore, it can be inferred that there are the following two types of profit models in the current BCG.

Marketplace type
・Profit model with the largest royalty income from secondary distribution on the NFT marketplace

NFT sales type
・Profit model with the largest sales profit of the new NFT collection

Let’s take one of the BCG titles, Splinterlands, as an example and see how it is classified into types of revenue models. Splinterlands has built a revenue model that combines three revenue points: royalty revenue from secondary distribution on the NFT marketplace, revenue from new NFT collection sales, and revenue from token sales. In addition, the new NFT collection has the highest sales profit when referring to sales by each revenue point. Therefore, Splinterlands can be interpreted as adopting an ‘NFT sales type profit model with three profit points’.

Regarding the BCG title STEPN, which became a hot topic in Japan in 2022, Solana, the blockchain used by STEPN, was not compatible with EVM (Ethereum Virtual Machine), and the NFT contract address was disclosed. It was difficult to obtain on-chain data on NFT trading volume due to factors such as the fact that the secondary distribution market was limited to its own marketplace within the app, so it was excluded from the analysis in this report. increase. However, it should be noted that STEPN did not invent the type of revenue model for the next generation of BCG.

Like other BCG titles, STEPN uses three revenue points: royalty revenue from secondary distribution on the NFT marketplace, revenue from sales of new NFT collections, and revenue from token sales, and the revenue model itself is the marketplace. It can be classified as either type or NFT sales type. The revenue model classification cannot be finalized because, as mentioned above, it is difficult to obtain on-chain data on NFT trading volume. Since it is disclosed that the royalties and marketplace fees in STEPN are 4% and 2% respectively, if the NFT transaction volume can be obtained, the revenue model can be classified by estimating the sales for each revenue point. can be confirmed.

STEPN can be said to be a BCG that has succeeded in mass adoption by adopting a new game system called Move to Earn while diverting the revenue model of the existing BCG. Now, based on the above, what are the advantages and disadvantages of the two profit model types? Let’s take a closer look at each type along with a representative BCG Income Statement (PL).