In the latest episode of Block Fuel Podcast, hosts Jody Florentek (@JodyFlournoy) and Avi Masch (@AviNMash) invited Soby (@soby0x), the founder of XAI Games, to discuss the current state and future prospects of Web3 games. Soby, a seasoned professional with nearly a decade of experience in the crypto field, presented a comprehensive analysis of Web3 games with candid and in-depth insights. The conversation covered multiple topics, including the evolution of the Play-to-Earn model, user acquisition strategies, the application of AI in game development, comparisons between indie and AAA games, and innovations in DeFi and Sentry Nodes. Below is a detailed summary of this interview, providing an in-depth look at the opportunities and challenges in Web3 gaming.
Soby and the mission of XAI Games
Soby's journey into crypto began in high school when he traded virtual items using Bitcoin on the gaming platform OP Skins, an experience that sparked his interest in the intersection of blockchain and gaming. Today, his founded company XAI Games (a gaming L3 chain Zai based on the Arbitrum tech stack) is committed to advancing Web3 gaming through innovation. XAI Games is not only a game publisher but also launched a user acquisition and distribution engine ZaiPlay (now renamed @raijin_games) aimed at bringing traditional PC gamers into the Web3 ecosystem while attracting talented indie game developers. Soby emphasized during the interview that he hopes to find breakthroughs in the complex and opportunity-rich field of Web3 gaming.
The evolution of the Play-to-Earn model: from money-driven to intrinsic value
Soby offers profound insights into the evolution of the Play-to-Earn model. He points out that many players engage in such games to earn money rather than to enjoy the fun of gaming itself. He believes it is unrealistic to directly promote complex DeFi mechanisms (like lending or cross-chain farming) to casual players. Instead, he advocates that Web3 games should 'greet players where they are' and gradually guide them to understand crypto features, rather than forcefully selling complex financial tools. His vision is for players to develop interest in these mechanisms over a period of six months to a year. This approach respects players' gaming experience while laying the foundation for the sustainable development of Web3 games. Soby emphasizes that an experimental spirit is at the core of the crypto industry, and XAI Games is exploring new gaming behaviors and possibilities through these attempts.
User acquisition and skill proof: The innovation of Xai Play
Soby detailed Xai Play (now @raijin_games), an engine aimed at solving user acquisition challenges in the gaming industry, particularly for traditional PC players. The core of Xai Play is the 'skill proof' system: players log in via their Steam accounts, and their gaming achievements are recorded on the Xai blockchain and minted as NFTs, earning points and leaderboard rewards based on achievements. Soby likened it to 'Layer 2 for Steam,' providing additional incentives for existing players while introducing them to the Web3 ecosystem. He mentioned that user acquisition costs are high in both gaming and finance, and Xai Play reduces this cost by rewarding players for their skills and participation, building a sticky user network. This approach also provides developers with precise player data, aiding in more efficient game distribution. Soby noted that if a player ranks high in a competition on Xai Play and uses that to pay off student loans, such a story would be more impactful than simple cash rewards, thereby enhancing brand trust.
The role of AI in game development
Soby believes that AI is significantly optimizing the game development process, especially in the conceptual design phase. With AI tools, developers can quickly generate creative concepts, reducing back-and-forth modifications with the art team, thereby shortening development cycles and lowering costs. He predicts that AI may also play a role in more complex areas like 3D modeling in the future. Additionally, he envisions AI could lead to a 'renaissance of old IPs,' such as remaking classic games with modern graphics, satisfying players' nostalgia while recreating their value at a lower cost. AI will also provide more experimental space for indie developers, driving the birth of innovative gameplay.
Indie games vs. AAA games
Soby shows a clear preference for indie games. He likens indie games to startups, full of passion and agility, while AAA games resemble large corporations, well-produced but more conservative. He mentioned that AAA games like Red Dead Redemption, while stunning, have complexities that make Web3 integration impractical. In contrast, indie games, due to their flexibility, are better suited to explore Web3 possibilities. He cited data indicating that about 45%-50% of games on Steam earn over $10 million, many of which are indie games. For instance, the indie game Balatro, which combines poker and Roguelike elements, reportedly generated $100 million shortly after its release. This suggests that innovative gameplay and immersive experiences can attract players more than high production costs. The distribution capability of ZaiPlay will further help indie games reach a broader audience.
Innovation in DeFi and Sentry Nodes
Soby shared XAI Games' technical breakthroughs, particularly the 'Sentry Nodes.' This is an incentive mechanism designed for Layer 2 optimistic Rollups (like Arbitrum), which encourages users to verify network status through crypto rewards, addressing the 'bystander dilemma.' Additionally, the sentry keys have financialization potential, allowing players to use them for lending or selling future token yields. This DeFi integration provides opportunities for crypto enthusiasts to participate while maintaining a low barrier to entry for casual players through simplified designs (like social logins).
Conclusion: The future of Web3 games
Soby firmly believes that 'games are the best use case for blockchain' since digital ownership enhances player immersion. Through ZaiPlay and a $100 million incentive fund, XAI Games is dedicated to connecting indie developers with Web3 to create sustainable revenue models. He stated that once real players join, top developers will be attracted to the space. For listeners interested in following the progress, he suggests keeping an eye on his Twitter @soby0x and the official website of XAI Games. This conversation showcased the complexity of Web3 gaming and Soby's ambitions, and we look forward to more updates in this field.
More information:
Game public chain Xai: Binance Square Database
