In the last article, we have listed different examples to demonstrate the diversity and possibility of X To Earn. But before going into details on how to integrate it into your business development, three key elements should be acknowledged and prepared to get a great start for your project.
NFT, definitely, is one of the key elements. For instance, the props and weapons in the Play to Earn game, the sneakers in the Move to Earn project,
and the characters in the Learn to Earn program, are all NFT. The adoption of NFT, in fact, is based on two of its characteristics.
Firstly, the uniqueness of NFT. The non-fungible nature of NFT makes it a perfect digital credential, or an "identity card" in the Web 3 world. It can not only be used to identify the user's identity but also link the identity to the "wallet address" for income allocation. The second is scarcity. By controlling the rarity of issued NFTs, such as the level of game weapons, sneaker styles, etc., the project owner then can master the user's entry barrier and income level, or even develop a membership system. The NFT issuance plan, thus, determines the development direction of the X To Earn project.
Needless to say, the word “earn” is the key icon that a X To Earn project catch people’s sight. The issuance of a token, in this case, is the most straightforward and convincing way to attract people, as it directly allows users to quantify their daily activities into tokens. Issuing tokens seems to be a one-off thing, however, it is not limited to minting new coins and sending them to users’ wallets but involves different levels of business planning. Say: whether to adopt a single-token model or a dual-token model that includes the “governance token” and “utility token”?
The former is relatively simple to design and manage, but the latter allows projects to have a bigger presence in the cryptocurrency market. The position of the token is worthy of attention. Should it be a coin that draws people’s attention with a huge market capitalization or a penny coin that brings people’s imagination of huge returns? If it is the former one, will it participate in decentralized finance (DeFi), and how to ensure the income of the validator? And if it is a penny coin, is there any strategy to attract users to continue to participate to earn coins? Also, if there will be an Auto-Burn mechanism? All these are the questions that need to be planned carefully before issuing coins or the technical problems, negative PR image are waiting ahead.
If the issuance of tokens allows the users to experience the joy of earning, the tokenomics system, in this sense, is to design a complete field for them to spend "money". The importance of the tokenomics, however, is not only about sending the tokens to users available but also about the imagination it can bring to users
- will it be able to redeem the coupons of a big brand that can be used in the physical world? Or will it be possible to stake the tokens to earn more coins, in exchange for voting rights or participation in designated events? Or is it possible to use the token to buy NFTs and have different assets in the metaverse? What tokenomics system represents, thus, is the ecosystem and development blueprint of the entire X To Earn project.
Therefore, for an X To Earn project, these three critical elements, namely, NFT, token, and the tokenomics system are interlinked. They need to be carefully planned and laid out. And after getting these items ready, what’s the next step? Stay tuned for the update!
