In 2021, the GameFi project represented by Axie Infinity combined NFT with DeFi and successfully brought P2E (Play-to-Earn), a new economic model, into the mainstream market. The utility NFT assets that were p in the GameFi project gradually developed into an important asset class in the blockchain world, while the demand for releasing the value of utility NFT assets, promoting liquidity, and providing related supporting NFTFi services is also increasing day by day. The existing NFT infrastructure significantly limits the scale expansion of P2E projects.
The current mechanism to manage the circulation of NFT assets in most Web3 game lifecycles is lacking. For game playing guilds (Guilds) often lack effective measures to hedge the risk of NFT treasury, and their scale expansion is limited; ordinary Web3 game players lack sufficient time and professional skills to participate in P2E, and they need to bear idle NFT assets at the opportunity cost.
Although investment in the Web3 game circuit has rapidly grown since 2023, the current Web3 game market development is far from what was envisioned. Most Web3 games are not sustainable, while the rental economy of Web3 games is contributing to Web3 games becoming a more sustainable economy.
Rent to Buy: The Key to Sustainable Web3 Games
Everything in the real world can be rented out, from rechargeable batteries and vehicles to clothes and houses, and the NFT sector is no exception.
With the explosion of NFTs and Web3 games today, although the NFTs for these Web3 games are unique and diverse, NFTs are not cheap to buy and collect. In Web3 games, renting instead of buying creates a secondary economic cycle where NFTs don't just sit idle in the user's wallet, they also provide passive income for renters.
From a renter's perspective, NFT rentals offer a low-cost option to take advantage of some of the services NFT offers without spending hundreds or thousands of dollars on them, such as access to premium members-only content. Web3 games give their holders the opportunity to compete in competitive PvP tournaments and the chance to win with the same heroes. Renting "NO Surrender Heroes NFT" will allow renters with decks powered by higher-level heroes to make money from their holdings.
For renters, it's like renting a hero from an online catalog - you fight in a short tournament and then return it. There is no need to make a long-term commitment to hold it, and renting instead of buying not only allows you to share it with others for a fee but also lowers the barrier for players to participate and promotes the sustainable development of Web3 games.
AFKDAO: Full-stack closed loop of the NFT leasing protocol layer
The market has not paid enough attention to this track for this brand-new user demand, but there are already some pioneers who have started exploring this field. The current market for NFT leasing solutions is divided into a capital pool and P2P models. Although the capital pool can quickly meet the lending demand, the productive function of NFT is locked. The P2P model, on the other hand, has higher interest rates. The NFT market lacks solutions that establish new underlying asset standards to facilitate the development of NFT lending scenarios.
Taken together, most of the teams are implementing the lending/leasing function of NFT assets from the business model/product innovation perspective, while AFKDAO chooses to start from the underlying protocol and proposes a new standard, ERC-4610, which can fundamentally activate the DeFi-enabled application of NFT assets and enhance the efficiency of NFT asset liquidity.
AFKDAO team launched a set of practical NFT DeFi infrastructure solutions including the new ERC standard, trying to apply to Web3 gamers with the help of DeFi's product model. Technically, AFKDAO has built a full-stack closed loop for the NFT lease protocol layer.
Meanwhile, the AFKDAO team has partnered with over 50 projects, including PlaceWar, Tap Fantasy, Ragnarok Cryptoverse, Kyberdyne, Frontera NFT, Godland, and many more.
As more and more Web3 games become mainstream, leasing will become an important source of passive income for NFT holders. AFKDAO's comprehensive product system, innovative protocol standards, and strong team and operational capabilities have the potential to completely unlock the leasing economy for Web3 games.