If you would like to view the full recording of the live Crowdcast event, you can find it on our YouTube channel. You can also read the full Quarterly Report by Jerry Sun and Mihai Grigore here.
Participants:
- Jerry Sun – Research Analyst, Messari
- Mihai Grigore – Senior Research Analyst, Messari
- Miles Anthony – Founder, Decentral Games
- Ryan De Taboada – Chief Operating Officer, Decentral Games
Jerry Sun (00:06): All right, I think we’re live here, cool! Welcome to everyone on the call. Thanks for tuning in here. We’ve got Miles and Ryan from the Decentral Games team with us today. I think we can get things started with a round of introductions from all of us. Miles and Ryan, I don’t know if you guys want to go first?
Miles Anthony (00:26): Yeah, thanks for having us, really appreciate it, and thanks for everyone for tuning in. I’m Miles, co-founder and CEO of Decentral Games. We build ICE Poker. It’s the first play and earn and poker game in the metaverse. We populate various venues in Decentraland and account for upwards of 60% of the DAU there, so, yeah, really looking forward to diving in a bit more in detail today on this
call.
Ryan De Taboada (00:58): Great. And Ryan here, Operating Officer, Decentral Games. Background, I worked for some big companies like Amazon and Credit Karma. I only made the move full time in 2020. I highly encourage anyone considering it to make the jump. Thanks for having me.
Jerry Sun (01:16): Of course! Quick question before we get to our end – what made you guys, start Decentral Games? Just some quick background, I guess.
Miles Anthony (01:27): So, we started Decentral Games kind of in the midst of a bear market. It was in early 2019, after having been a part of the Decentraland community, being, pretty early there, participating in the land sales. And, we were just very bullish on the metaverse back then and we felt that it created a token use case that was very, warranted at the time when a lot of token use cases were not really valid. And we felt that if we were to establish ourselves as kind of a main application within the metaverse, we would benefit from the general adoption of the metaverse which we’ve kind of seen and just positioned ourselves for a huge influx of users as more and more people kind of explored it. I just started very simple with building, kind of, just, straightforward games like slots, roulette, blackjack, backgammon. Didn’t really find the product market fit until we released our ICE Poker game. With a kind of play-to-earn and token model. So, yeah, that’s basically the general overview, I’d say.
Muhai Grigore (02:47): Fantastic, so on my side, my name is Mihai. I’m an analyst with Messari. I’m based out of Zurich, Switzerland and, together with my colleague, Jerry, we have co-authored the Decentral Games quarterly. Over to you, Jerry.
Jerry Sun (03:06): Sweet. Well thanks for the introduction, Mihai. And another welcome to everyone on this call. I think we can kind of jump into it and, Ethan, if you want to
share your screen, we’ve got a presentation to kind of go along with our conversation here. I think, like I said, just diving straight in, I think a lot of people here are kind of curious about the tokenomics of the game. Ryan – something that you
mentioned to us a little while back is that the game is really modeled similarly to Axi Infinity, the play-to-earn model. And, as we know, it is a very successful model. Axi Infinity became really big, very prominent globally, but at the same time I think there are some concerns about, “How does Axi Infinity really build kind of a sustainable token model?” Things like that. Miles, some of the things that you were talking about a little bit earlier in the introduction as well, right – and so just high level. And I think as many people would be interested to know, like, how do you guys think about the sustainability of both your tokens, right – like ICE token and your DG token? How those operate and, like, what the long term outlook looks like for your vision of it?
Ryan De Taboada (04:22): Yeah, absolutely. I can comment there. So, it was about a year ago now, a little less, that Axi Infinity was really taking off and saw the success of play-to-earn as a user acquisition model. So, while a lot of these large crypto protocols had like 10 – 20,000 users they were boasting a million, two million people onboarded on the crypto and we came at this from, I think, the reverse perspective of a lot of the play-to-earn games coming to market which is that we had been building a game for the last year which was Texas Hold’em south poker in the metaverse. It was in 3D, social, based on the Unity back-end so we had this fun game. So we could then apply the economics to it started pouring into in the economics that Axie designed around the game and definitely saw they were also pretty transparent about the fact that this breeding model is problematic because if you allow people to sort of exponentially mint new NFTs into your ecosystem you’re burning, SLP but creating a lot of these additional assets. The one thing that we built in was an upgrade or vertical progression model. So just taking a step back on the economics, it is similar that you either need to buy an NFT that’s decentral and wearable, we launched them in sets of five. These are outfits that you wear in the metaverse and then if you buy one or you have one delegated to you then you get a daily allotment of chip. These chips are not redeemable for anything. They refresh at midnight and then, if you think about Axie’s challenges, depending on the stamina that you have you’re able to complete these different challenges. You get different amounts of chips based on how many wearables you’re wearing and then you’re rewarded based on how you did it over that day but you took your 3,000 chips to 6,000 chips a lot more heights if you lost all three thousand just that day. There’s also a time-based component where people need to win a certain number of hands but we guarantee someone doesn’t just come in, play one hand finishing the 50th percentile. But then people are earning ICE but people also spend ICE then upgrade their wearables which, makes them cooler flashy and so that’s the burning mechanism upgrade progression rather than and then finally we built delegation into our platform because we saw that, on average actually was losing around 10% of that SLP to these skills guild management tools and that it was introducing a third party between the NFT owner and the delegated player. People can manage their own guild directly. I guess we’ll leave it there as an introduction. Miles, do you have anything to add?
Miles Anthony (07:34): Yeah, that’s a great overview of our game mechanics, currently. But also it’s worth adding, we are constantly trying to add additional utility and sinks in place in the ecosystem for ICE. One of the things that we’re most excited about right now is just a tournament mode. We’re just going to be rolling out simple, single table sit-and-goes in the metaverse. They’ll act as a massive ICE sink for the ecosystem. We’ve briefly, kind of, released a bit of info on this. But generally, we kind of view the existing ICE Poker game, which is scaled over 10,000 DAU in the metaverse as a base layer of getting people actually into the metaverse – something that not many folks have been able to do yet. So, building these other game modes on top of just the general ICE Poker. ICE Poker SNG and many in the future made multi-table tournaments. We want to make it as skill-based as possible, act as these massive ICE sinks for the ecosystem, and just make it fun. So really excited to get those new game modes out. We’ve been diving in following our deployment of assigned seating last week and stabilization of assigned seating last week. So I think we’re in a really lucrative position from a play-to-earn standpoint. Just given the fact that people already are familiar with spending, kind of whether it’s tokens or cash or whatever on this game, the game of poker. And so, kind of putting it into an angle for a product was a bit easier for us I would say than most play-to-earn games. That’s, kind of, the narrative shifts towards, like, more token burns and token utility as opposed to just rewards. So looking forward to getting those new game modes live as soon as possible.
Jerry Sun (09:25): Gotcha, yeah. Ryan, like, you bring up the Axie comparison and I think one of the things that people will say about Axie is that it is a very, kind of, like, rudimentary, elementary game. And if you grow up or you grew up playing triple-A rated, kind of, live action high graphics games, they’re going to be really – it’s a really difficult transition to move from that type of game to like a Pokemon lite card based game. And so, I mean, we mention in this report, but kind of bringing poker into the fold I think in that way is really smart because a lot of people do play poker it is a very popular game, popular card based game, so it’s a good kind of mode for where we are now with the era of blockchain games.
Ryan De Taboada (10:21): Yeah, and then . . . sorry, go on . . .
Jerry Sun (09:25): No no, Ryan, please.
Ryan De Taboada (10:21): I was gonna say yes, 100% agree. Poker has 20 million monthly active to play under this premium model where they’re either playing for free and not earning, or they’re even paying to climb the range for free. People are familiar with poker, it’s a fun game that many people play without earning. And just to add on to Miles’ point as well, I brought up the upgrade model versus the breeding model, but I completely–I think we completely recognize that no one token sink is like the only sink that’s gonna burn all the tokens that are emitted. Like we have advertising deals in a sustainable economy has many parts. It’s not just like in and out where tokens are earned one way and then they’re burned this other way and we hope that that’s worked one-to-one on those two items you have to have many different the whole upgrade token to get to a sustainable economy.
Muhai Grigore (11:41): Perhaps in terms of monetization strategy for Decentral Games, we were wondering what that is for the longer term? So, currently we’ve seen that 93% of your revenue is out of minting of new NFTs and also of upgrades, in-game upgrades. And we were wondering whether these revenue streams will shift over time, so what is your take there?
Miles Anthony (12:13): Yeah. On top of that, for our revenue we bring in quite a bit of revenue just from secondary sales. So, right now all these secondary sales are carried out on OpenSea. For those we charge a 5% fee, so that’s been able to fill the treasury governed by DG token holders with ETH. Kind of moving forward we do expect that to grow as we continue expanding our NFT supply in the future. But, yeah, right now we’re really just focussed on sustainability and stabilizing the ecosystem. I know a lot of play-to-earn games have kind of been experiencing slight recessions recently. And so right now our main focus is really just just driving stability to the ICE economy. That being said I do think it is substantial the amount of ETH that we bring into the treasury each month from the secondary sales, so one of our biggest initiatives from a product standpoint, engineering standpoint, is building our own ecosystem marketplace. So, kind of moving our secondary sales from OpenSea which, you know, where they currently are, onto our site. Even offering transactions with ICE as well. So we do expect that to both add a lot of ICE utility in general so people are transacting, and holding ICE to participate in the ecosystem from the secondary sales standpoint. But then also charging a fee on that marketplace that’s not entirely being extracted by, or partially being extracted by OpenSea. So we do expect that to be a lot more efficient from an ecosystem standpoint. But yeah to answer your question in terms of the model for revenue long term for the treasury the Decentral Games treasury is mainly just these fees for secondary sales.
Ryan De Taboada (14:11): During a growth phase the majority of our revenue will come from selling these items where the DG DAO gets 100% of that revenue versus 4.9% of the secondary revenue. But as the economy matures the velocity of these wearables being traded, upgraded, activated is going to make a big difference. So at scale we would expect that to grow roughly proportionally to the number of items, but while we’re growing I think the mints will be perhaps not 90% of revenue but the majority of revenue.
Jerry Sun (14:49): Longer term do you see some sort of value accrual to DG potentially, as like, purely a governance token right now but this is always a big question, kind of, in the crypto ecosystem.
Miles Anthony (15:05): Yeah, definitely. So right now the DG token holders as a governance token governs a little over 40 million of assets in our treasury and view it on our website. That treasury is fed primarily as Ryan outlined right now by mint proceeds when we do ETH mints as well as the secondary sale volume that is paid in like the royalties. So yeah, that accrual has been nice. We’ve passed various governance proposals to allocate funds from mints to LPing, we provide all the LPs for DG and ICE pairs from our treasury. And we look forward to, kind of, adding more and more initiatives even around marketing or growth or user acquisition in the future from those clouds. But yeah, the accrual is directly to the treasury which is governed by the DG token holders. So, yes, we – our aim is to accrue value there.
Jerry Sun (16:07): Gotcha.
Ryan De Taboada (16:12): Yeah, if your question is ‘what is the relationship between the value of the treasury and the market cap of the token’, that’s above my pay grade. I don’t know how people are valuing whether revenue or downtime.
Jerry Sun (16:07): Yeah, I think it’s kind of a question that I guess a lot of people don’t know the answer to right now because of how tokens are categorized. I suppose five, ten years from now you can see like dividends or more closer to traditional equities or this is the whole, like, securitization of tokens and what that might mean. That’s beyond all of us, right? That’s up for regulatory policy. But I’m just kind of curious as to how projects are, kind of, thinking about that right now, right? We can go to some of the daily average metrics here if we want to jump to the next slide.
Mihai Grigore (17:12): Absolutely. So here we’re able to see a very beautiful progression in terms of a number of daily active users reaching close to 12,000 recently and here we were wondering that the amount of players is pretty much bound to the number of NFTs that are minted and we counted them together and we came to the number of 14,000. So, here we were wondering if we have like 12,000 daily active users that require at least one NFT in order to be able to play. Would it be a fair way to compute a utilization metric here, and utilization ratio? Would that be dividing the 12,000 daily active users by the total amount of NFTs which is 14,000. Is that the fair metric, or would you actually measure it differently?
Miles Anthony (18:10): For the utilization of the NFTs, it’s a bit–there’s another layer in there in that these wearables are actually stackable and so you can actually wear up to five different wearables at the same time this gives you a larger bonus. And we’ve actually increased these bonuses recently with a governance proposal and so Ryan can kind of dive into a bit more detail on the utilization rate that we have with those. But, yeah, so some players obviously play with– two, three, four, up to five wearables and so the DAU actually could be slightly lower than the actual total amount of wearables being utilized.
Ryan De Taboada (18:52): Yeah, I don’t have anything to add there, just that that’s about right, particularly if you look at Q1 that the majority of players are playing with one wearable. There’s 12,000 DAU and 14,500 wearables, but we’ve actually seen stacking increase and we’ve continued to incentivize that as a behavior that could go into more detail about why we think that’s good for the ecosystem. But, I’d say the utilization rate is a little higher than that because not everyone is playing with one, but not a ton. I see people in the chat are mentioning that they– ‘I have 11 wearables stacked on three delegates’ [thanks josh]. That’s been a more recent trend whereas it was more like one-to-one last quarter.
Jerry Sun (19:45): Gotcha. That makes sense. The first question that I have, just for me, is in terms of web3 games, especially something like ICE Poker where a lot of ICE rewards are distributed, if you complete daily challenges or certain objectives, do you guys have any issue with bots? Have you kind of seen that if, for example, you check in and you’re able to, kind of, be eligible for certain rewards, like, are bots able to go and do that, or have you thought about this problem?
Miles Anthony (20:15): Yeah, it’s definitely been discussed pretty to a certain extent in our community. In terms of bots in Decentraland, it’s a bit tough to code a bot to, navigate in the 3D environment, sit at a table and click on the 3D buttons to play the game. The main issue we had was just, kind of, people, multi-accounting. But manually multi-accounting. We’ve added measures in place to prevent against this. Right now we only allow one account per user. And so luckily we haven’t really had to deal with too many bots. That’s going to be a main focus as we roll out our mobile products and kind of our web-based 2D products. Obviously that’ll be a bit more of an attack vector there, so we are going to be taking measures to prevent that a bit more seriously from that product standpoint. But, that being said, I think with our current product, it is a bit tough to bot, just given the environment of the game.
Ryan De Taboada (21:19): Yeah, but also want to address it, as people in the chat are calling out, and as you see on that chart that we, this was a major initiative last quarter to assign seats so that someone with multiple tabs open, multiple VPNs, it’s not sitting with multiple accounts. We actually assign a seat at a table when you walk in that flow is challenging in 3D virtual worlds to come in and say for this user you need to go sit at this table in space but that’s now out, and there are still remaining attack vectors I think across games this will continue to be a really important point but we’ll also, as Miles mentioned, have a lot more control over the experience within the mobile version which we’re taking the opposite example of existing play-to-earn engines, right? Everyone else has a browser-based 2D either mobile or tablet version. We’re expanding in where we started three years ago in Decentraland, in the virtual world and we’re launching mobile in the coming months, and we’re very excited about that.
Jerry Sun (22:29): In reference to assigned seating here and this dip it’s a very temporary thing. It seems like it was just kind of like a one or two day situation but what was, kind of, the factor here that caused daily average user count to go down? Was it just inability to log in, or just, like, unfamiliarity with the change? Any, kind of, insight there?
Miles Anthony (22:53): Right, yeah, so assigned seating is definitely a feature that we do think we should have implemented a lot sooner than we did. Just given the attack vector of folks being able to collude. But, that being said we tried to get it live about a month ago, initially, and there were issues with scale. Like we tested with our QA team to a large extent with no issues. Even tested with our beta testing community, 40, 50, 60 amount of users at the time with no issues. And we experienced these issues once we went to production. Had 1,500 daily active concurrent players right there playing and using the feature. And so we had that, we had to rethink, kind of, the architecture of it because, clearly, as we released it, back at the end of March there were issues with the feature. The way it managed assignments and unassigned people once they left the table that we didn’t really see with the lower amount of users. So, that being said, we kind of redesigned the architecture on the back-end, upgraded our back-end architecture from a hosting standpoint, as well, and then relaunched it last week. Since then, it’s performed much much better than it did, prior – and so, yeah, we’re really excited because I think this feature is essential and it was kind of like obviously like ripping a band-aid off because it’s so essential as we plan to roll out tournament mode like sit-and-gos and then eventually multi-table seat assignments going to be a key part of that just to prevent any collusion. And so it was something that needed to be done. Obviously, we would have preferred to have done it sooner than later, but, we’re really happy that we were able to get it out there live.
Jerry Sun (24:29): Gotcha. So, I guess for people on the call who may not know the gameplay as well, we’re just kind of tuning in to hear about the game with the assigned seating feature. Let’s say I have a friend who wants to play poker with me, and we want to go play together, but we, you know, let’s say this is metaverse, right? We can go and enter the metaverse and play. With assigned seating, are we not able to go and, kind of, sit at the same table? Or how does that work?
Miles Anthony (25:06): That’s correct, yeah. With assigned seating you get assigned a table randomly within the venue that you enter. There is a chance you could get assigned the same table, but it’s unlikely. And, yeah, this is, I mean, this is mainly just to prevent people from abuse – of abusing – the rewards system. Because once you’ve put an incentive in place based on performance, and, obviously people are going to try to exploit it. So it is not ideal because you can’t sit next to your friends. But we do have a venue that has just like free-play poker and a non-ICE poker, that if you do want to play poker in the metaverse with your friends you can hop in there and play, right?
Jerry Sun (25:48): Right, no. I don’t want to cheat, I’m just asking, I guess, for the purposes of this call here to answer one of the questions.
Miles Anthony (25:54): That being said, the chat actually brought up a good point. So we do have, like, one venue, that we, where we allow open seating currently called Diamond Hands City. Basically Diamond Hands refers to the level five wearables. So if you upgrade your wearable four times to level five, it becomes a very flashy and golden wearable. It’s very noticeable. And it’s kind of like a digital or virtual flex and so if you own one of these top level wearables, then you’re able to access this Diamond Hand City venue and it’s a very opulent 3D venue. And in there you’re actually able to play with your friends. So yeah, you can play ICE Poker with your friends, but you do have to put in a lot of work to earn your way to that status.
Jerry Sun (26:46): Gotcha, gotcha. All right, well if you want to jump down I think we can talk about some of these secondary sales. I guess like one of the data points that we saw, just looking at sales data for wearables, is when you take a look it seems like rank one, rank five NFTs, they’re actually selling on average for, I guess, you would say on average they’re selling for the least and then you’re actually seeing like rank two, three, four NFTs selling for, like, generally higher. Obviously there’s a lot of data points here but I’m kind of curious to hear your thoughts on that. Like if you’re grinding, you’re grinding out to level five and you get the highest level NFT, you’re actually not, I guess, on average potentially selling it – based on data points that we have – selling it for as much as maybe even a rank four or, like, rank two. Do you have any, kind of, thoughts on that kind of secondary sales ecosystem of these NFT wearables?
Ryan De Taboada (27:56): That’s very interesting because those data points called out are from March. I don’t know, the additional variable would be the collection so we do have some, like, there’s the Genesis collection, the very first one that does more volume and generally at a higher price, but in general, I would say, for the same wearable in the same question, like, a level five is always going to sell for more than level fours and level three because a level four wearable can be you’re in some experience points you’ve been sometimes upgraded it’s just worth strictly less than the level five of that same wearable, so it must be some sort of mix … mix in the data if it’s not fully clear from here that some collections maybe early collections, mid-levels, something higher than late-collection level five. I’m not sure.
Jerry Sun (28:51): That makes sense. And we do not differentiate between the different collections and, like, when they were minted. Here, this is just kind of all sales of any of these levels. In our report we kind of talked about potentially being that level two, three, four NFT sales are just less generally we see more sales of level one or level five NFTs, so it is a small kind of data point sample size for the mid-tier level NFTs compared to those on the end.
Ryan De Taboada (29:25): Yeah, we’ve done a ton of volume on OpenSea, as Miles mentioned earlier. Number one on Polygon, we look at 30 or 90 days and about about 12,000 ETH in volume on OpenSea, which we took 2.5% of that is a lot of value that’s leaving the ecosystem to feed to them, which is why an initiative for this quarter is to have our own marketplace where things are priced. You have the option to price ICE, but also, that money isn’t leaving the ecosystem to OpenSea. And I think why we’ve seen other large games have their own marketplace like Axies are tradable on their own marketplace and others, so I think that’ll be a big win for us. A big component of our revenue comes from these secondary sales and the subsequent activation of the wearables.
Mihai Grigore (30:18): Right. Speaking of secondary sales, how do you incentivize players to upgrade instead of selling?
Miles Anthony (30:26): For the upgraded items, typically they will have a price for it that is higher than the previous level, and then also they have a higher bonus variable. And so as you upgrade, the bonus range which you’re randomly assigned increases, and so you actually earn more rewards for these higher level wearables. I would say those are the two main incentives to upgrade.
Mihai Grigore (30:52): And is there any plan to slow down these rewards over time?
Miles Anthony (30:59): At the moment we recently passed the governance proposal to lower some of the rewards, just from a multiplier standpoint. So we’ve only done this, two times before. Basically adjusting the multipliers for the leaderboard. The leaderboard is basically broken down into 20 tiers based on your percentile. Percentiles are ranked by net chips. So, obviously, if you win a lot more then you’re at the top, if you’re losing, you’re at the bottom and or less. And this change that we recently enacted – actually, yesterday, at the end of the day – reduces rewards slightly. And, so, into the future, it’s mainly just up to the DAO to decide if we want to reduce these rewards further, just to stabilize the ICE ecosystem, but at the moment we don’t really have any plans specifically to raise or reduce the existing rewards.
Jerry Sun (32:00): Will there be an oversaturation of level five NFTs, or, like, rank five NFTs if that’s kind of the case? Because I’m thinking about the typical game inflation narrative, right? Where, like, the longer you’ve been playing, it’s going to be easier and easier to get level five NFTs, in theory. Because people are going to have more experience, they’re going to have more ICE that they’ve earned through the gameplay.
And as users continue to grow, daily users continue to rise, things like that, then naturally they are just going to be more and more rank five NFTs over time. And then since there’s nowhere to go after rank five, then there’s just going to be, kind of, over time, this potential surplus of level five NFTs. Have you guys, kind of, thought about that?
Ryan De Taboada (32:50): Yeah. So, to comment there – like, we do still see that the level fives are less than right around ten percent of the total NFTs in the ecosystem which is seven months into launch. So, because when new NFTs enter the ecosystem, they enter at level one. So, certainly growth helps us maintain a more healthy balance where there’s a ton of potential upgrading left and then I would add that the progression is long from delegated player to player-owner to perhaps owner of a level five item or owner of two or three level ones that you’re upgrading and then even if you did upgrade five items, there are many people who have ten items or twenty items and are delegating those out. So, I think there’s a frequent use case here who might have ten items, half of which are level five, or two of them are level five, and, even if they upgraded them, they might buy another level one and keep upgrading it. So, there’s really no end to this progression of delegated-player, player-owner or stacking wearables as a player-owner or guild manager. You’re delegating out and growing the size of your guild. I think that over the very long term, and particularly if growth were slow, that would become more of a concern. But for the time being, there’s a ton of this vertical progression and this progression within, you know, for ultimately different games. There’s the game of poker we’re playing here and then within these play-to-earn economies there’s the game of being a guild manager. And, like, if you have below average players in your guild, you’re going to earn less than half of someone who has above average players in your guild. So there really is this additional level of gameplay that is field management, too.
Mihai Grigore (34:40): So with respect to this vertical progression, where do you guys spend more time at the moment? Is it getting delegated players to actually own an NFT, or is it by motivating existing NFT owners to actually upgrade in-game? What is the reward structure there? Or where do you spend more time in motivating the players?
Miles Anthony (35:10): I would say there’s not, like, one or the other, we spend the most time on obviously two both are a priority. I think our main priorities that we outlined a bit earlier today are really just stabilized an ICE ecosystem, creating an outstanding gameplay experience. And so obviously part of that is welcoming folks in from delegated-player to player-owner and going from player-owner to owning multiple wearables and guild owner I think it really just starts with just improving the game and right now, as we touch upon the game is very simple as just a base layer. And once we add in these additional tournament mode like sit-and-go’s, it should add a lot more incentive, but also add a nice progression for a player that wants to, kind of, grind these tournaments to either earn their way to a wearable or earn prizes to get to that point, a lot faster than just buying one directly if they’re skilled. I would say it’s definitely split between the two. But really, it’s overarched. It all kind of wraps back into our objective of just stabilizing the ecosystem and creating a game that’s really fun to play.
Jerry Sun (36:30): Right, right. Ethan, if we want to jump down a slide. No particular question here but we definitely thought it was really interesting data. One more, Ethan. I think there should be like a bar chart that has some pretty interesting data. Another one. Yes, I think this one. I mean, no particular question from this but this is definitely pretty insightful. I guess what we saw was, over time, we saw that we compared the mint price for level one NFTs to, immediately flipping the NFTs in a secondary market, Like, how much would a player arguably stand to gain. And, like, with the drop, number one you can kind of see things with price a little bit lower, I mean, it was a new game at the time. And, in more, some of the more recent drops and I know this data is kind of ends at the end of March for Q1 but, like, the more recent drops of some of which of course were priced in ICE, like, drop 9, 10, 11, a lot closer to the immediate flip price. And, I thought that was a great decision and it kind of incentivizes players to not just go and mint-and-flip right away, but to actually, grind and to play the game and try to go and upgrade. If you’re buying it then you’re more likely invested in the ecosystem. I guess, Ethan, we want to go down. So, yeah this was pretty interesting data here. But we got some questions about, kind of, governance and roadmap. So, the first question I’ve got is – I know one of the major governance updates in the DAO is very active for decentral gamesIone of the major governance updates that caught my eye was allowing partnerships in the metaverse advertisements in these ICE Poker venues. Any opportunity for you guys to, kind of, speak on that – how that is kind of coming along on your end?
Miles Anthony (38:44): Yeah, definitely. So, yeah the partner to ads is just a it’s just a great initiative I know it’s been a few months since we originally passed the proposal we’ve been really just trying to find the right partner that not only you know find, really solid partners to advertise, but also be able to take payment from them and then, pay the DAO in ICE to contribute to the burn-to-earn. So, that’s kind of been a process but we’re really close to finalizing a deal with a great partner that’s crypto native, kind of, gaming native and has experience working with some of these big brands. Really just targeting brands that potentially have a presence in the metaverse build scenes of Decentraland but don’t necessarily have any way of, like, providing their scene or their deployment with ongoing users. And, so, really this just revolves around the fact that we’ve been able to solve one of the main issues with the metaverse currently which is just emptiness. We have over a 1,000-1,500 or so concurrence in our venues 24/7. And being able to monetize that traffic in a space that’s extremely nascent, it’s incredibly valuable. And, so, yeah, we do expect to announce, kind of, the more details on that deal initially in the next week or two. But finalizing it – it’s in the final stages. And it’s been great to also, kind of, bring on board Matt, our new CMO to, kind of, finalize and manage these deals going forward. So really looking forward to sharing more details on that soon.
Jerry Sun (40:29): Gotcha. And that’s, kind of, in its own way a game sink in itself, right? Because they’re going to be doing these deals through the ICE token?
Miles Anthony (40:40): Yeah, exactly. So, for now we thought it would be a great way to just add utility price from an advertiser’s standpoint. And then just contribute towards the ratio of the ecosystem. Thought it would be a huge win for the community. I know everyone’s pretty excited about this and it’s just value that we’re just not capturing at the moment given our presence and, kind of, leadership in populating the metaverse.
Mihai Grigore (41:09): Do you expect that to affect somehow the growth of users that you currently see?
Miles Anthony (41:18): I don’t think it would affect the growth of users too much. It’s mainly just putting up different still or video ads within the venues that the users will be able to see but I don’t think it will negatively impact the user experience nor our user growth.
Mihai Grigore (41:36): Speaking of user experience, we’ve read about the forthcoming mobile version of the game. Could you tell us a couple of words about that? So how that is going to be rolled out? Maybe a timeline for it and how it is going to be different from the desktop version?
Miles Anthony (41:55): Yeah. definitely. So by being, kind of, one of the first movers in the metaverse and into Decentraland, there’s obviously some constraints from a scalability standpoint. And, so, we felt that in January or so, that building a mobile first kind of experience that’s also accessible on desktop via PWA would be a great way to be able to expand our user base, outside of Decentraland and really own the full client experience for the product. And, so, yeah, we’ve been developing it over the last several months. Our header product, Leo, has put together kind of a phase-by-phase rollout plan. We’re currently just in the phase of, kind of, internal testing within the team in QA. The next step will be closed alpha – looking to bring in 50 to 100 community members to test it daily. Moving into closed beta, then we’re kind of moving towards several hundred community members, and then finally a launch. And so the thing that we’ve been discussing more recently in detail is like obviously we’re going to be bringing in users to help test this without rewards initially. Kind of, planning out the launch of this, I think it’s really, kind of, ties back into our discussion earlier about the tournament mode, kind of SNG style gameplay. And, so, we’re really figuring out, kind of, the best approach for that final, you know, that fourth phase of the rollout which will include potentially distributing some of these mobile wearables via rewards from SNG. So, exploring, kind of, just launching that version first before even doing any mobile mints or anything. So, yeah, I think these two game modes really will complement each other really nicely. Because ICE Poker as it stands, is kind of a great tool for user acquisition and growth. At the same time, it kind of emits decent amount of tokens whereas the SNG will be a massive token sink so actually I take in tokens from the community burn them while also delivering a really fun kind of more competitive skill-based gameplay experience and then ultimately SNG will be able to distribute wearables to the community as prizes. So, yeah, I think the two game modes together will complement each other really nicely and it was always kind of the plan to roll out ICE Poker SNG or ICE Poker tournament mode, we just were kind of delayed a bit from the assigned seating implementation. But now that that’s live and stable we’re really excited to dive into this new game mode for both metaverse and mobile and all metaverse NFTs currently in circulation will be usable with the SNG gameplay as well.
Jerry Sun (45:06): In regards to another one of these governance updates, there was a proposal to go and implement NFT drops using the ICE token instead of ETH because previously it was all done in ETH and then this governance proposal got passed and now it looks like there are these drops when they occur simultaneously, or not simultaneously, I guess they’re announced simultaneously and they occur kind of a couple weeks after each other, but one of them will be done in ETH and then one of them will be done through ICE tokens. Do you guys think like long term, and this is also up to the DOA, but just from your guy’s perspective, is that something you would like to go and eventually see long term is a move towards ICE-based mints full time, or is this do you like this kind of combination where you switch back and forth between ETH and ICE?
Miles Anthony (46:02): I would say from, you know, from the beginning it was healthy to switch back and forth even like prioritizing eight minutes to start. But granted our main focus right now is stabilizing the ICE ecosystem and ICE in-game economy, we have been heavily kind of leaning towards the ICE mints. I think it’s just a very powerful tool that the DAO has to, kind of, stabilize things going forward and respond to market conditions to be able to employ either one. That being said, our next mint is tomorrow collab mint with the Mutant Cartel folks and that one is in ICE. And I believe the last two or so mints have been in ICE. So, definitely leaning more towards ICE just as we, you know, end up stabilizing our ecosystem.
Jerry Sun (46:52): Right, right. The move towards ICE I think is, again, talking about game scene. So, we’ve been kind of talking about that throughout this call, but it is a nice way of implementing new games for ICE that’s kind of out there among players to come back into the ecosystem. We do have some questions here, it looks like, from the community. So I want to make sure that we get to these. I’ll just start, kind of, from bottom to top. So, “Will the DAO infuse funds into the USDC/ICE LP pool if needed?”
Miles Anthony (47:35): It looks like that was submitted as a proposal recently.
Yeah, I mean, it’s really, you know, up to the DAO to decide how to manage LPs, you know. We provide liquidity for both DG and in ICE pairs. So, in so far as the LP position for ICE has dropped a bit in terms of total value locked in the pool. And, so, yeah, we can absolutely consider adding to it. At the moment, we haven’t really considered that internally just because the ICE pool seems to be pretty healthy at the moment with minimal slippage, just given the fact there’s around like 4.5 to 5 million dollars in the pool.
Jerry Sun (48:20): Gotcha. A couple people wanted to know about whether or not multiple tabling would be allowed, or, like, multi-tabling would be allowed for local players. Why it’s not allowed now, and then, I suppose, to add on to that, whether or not it will ever be allowed, kind of, in the future?
Miles Anthony (48:52): So, right now, so far we haven’t allowed it. Just given the fact that assigned seating wasn’t live and, you know, it welcomes, kind of, just like this farming gameplay which we’re kind of trying to stay away from. Now that assigned seating is live, and now that we’re going to be rolling out tournament mode obviously, there’s been, kind of, dialogue in our Discord to bring back this conversation as a community. And, so, yeah, I think Leo, our head of products, spoke about this even at the last roundtable that we hosted. That we are considering opening it up for multiple accounts playing in ICE Poker SNG. Just given the nature of the game play and given the fact that it’s not really welcoming to, you know, the farming kind of mentality of gameplay. So, yeah, it’s absolutely on the radar. I’m just trying to figure out what the best way would be to implement it. Mainly just to prevent against abuse.
Jerry Sun (49:49): Right. Cool. So, it sounds like it’s gonna be potentially implemented in the future, but you guys are taking these baby steps to get there to make sure that, when it is implemented, it’s going to be done in a, like, appropriate manner?
Miles Anthony (50:05): That’s correct.
Jerry Sun (50:07): Cool. ‘Vixx’ wanted to ask “Can you guys touch on how assigned seating in low population realms is effective against check-cheaters and colluders?” And maybe just because it’s a low population realm you know there’s not a lot of activity compared to some other ones but, I don’t know. Do you have any kind of thoughts on this question here?
Miles Anthony (50:30): Yeah. For assign seating, you know, obviously, the implementation that we push live isn’t perfect and there’s been talk about actually even reducing the amount of venues, kind of, closing down one of our venues just to congregate users, kind of, more in our three other venues in four, yeah … But, yeah, I mean, if you’re going into a low populated realm, it still is kind of tough to get paired at the same table because it will assign players to up to five tables. But, there are user experience kind of hurdles in that sense. So, yeah, I think in our next iteration of the assigned seating we’re thinking about doing it just from the website and having that kind of feed into specific venues, or specific tables within venues. So it’ll be a much more effective implementation. But that being said, I do think, you know, the current implementation does prevent against most abuse which was much needed at the time.
Jerry Sun (51:30): Right.
Ryan De Taboada (51:32): Yeah, I wanted to also just comment more broadly on that, like, you can see from the question in the chat here, this is a really hot topic and this is something that, ICE Poker being a skill-based game, arguably either one of the few, or the only, like, actual skill-based, play-to-earn ecosystem that exists right now is like a huge benefit and selling point and makes it fun for people to come back where poker is a little different every day. But it also creates an incentive structure where bad actors can, if they find some work-around when we’ve developed multi-accounting, VPN sort of stuff, there is an incentive structure to cheat, basically. Whereas like there’s really no cheating in completing your twelve challenges with an action, something like that. And, so, like this is a constant struggle for us where we want to make the game more skill-based, and, say, we’re going to reward more and more of the people who play poker well, and reward less the ones that play poorly. Assigned seating was a huge component of that that needed to be rolled out with updates and challenges. And then we would love to allow people who have purchased multiple wearables to play on multiple tables, but it just adds to the complexity right now of a problem that we’re trying to solve. So, I think we can get there. It’s not the highest priority when we need to make sure that the game has high integrity. People are coming in and are playing poker that is legitimately similar to any other poker game and are playing with good actors who don’t have any unfair advantage against them. So, definitely a top priority for us and we need this to be skill-based and fair.
Jerry Sun (53:19): Right. I think that’s one of the things that, kind of, come along with choosing poker as your application. The game is very popular, and, like I mentioned, people do know how to play, but it is skill-based, so, in terms of people being good at it, or some people just doing it casually, there is that kind of discrepancy. Cool.
Miles Anthony (53:42): Exactly.
Mihai Grigore (53:48): So, perhaps, what do you think is going to be the next successful game that is also skill based, and is not poker?
Miles Anthony (53:59): ICE Poker SNG – Yeah, I think we’re really bullish on that. And I think it’s something that we … it’s, like, just low hanging fruit, something we can actually deliver on really quickly. And, we touched on earlier, it’s just a great way of just creating a more fun gameplay mode. But also just, kind of, allowing folks that are good at, you know, winning, to win their way to ownership, kind of, to feed that kind of progression from delegated-player to player-owner. So, yeah I’m really looking forward to launching that.
Jerry Sun (54:37): Sweet.
Ryan De Taboada (54:37): Yeah, I would maybe say, it’s really hard to do, like, board games or anything that’s a solved problem for a computer. Like, if you did play-to-earn chess, that’s probably going to be tough because it’s very easy to cheat at chess even if you have, like, another device over here and bring them in. Maybe some sort of, like, ‘Settlers Of Catan’ style game where you are, like, trading resources or something that is fairly skill-based and, like, very dependent on what other individuals do within the game. So, not something we’re working on. But bullish on the idea that some board games could perhaps be replicated within play-to-earn and NFTs and also lends itself well to NFTs. Mainly what we’re saying. That’s potentially a good idea.
Jerry Sun (55:25): Yeah. Just to, kind of, close out with some of these remaining ones, ‘Will there, when community events, tournaments or other fun things, they see Miles come play in DHC?’
Miles Anthony (55:40): In Diamond Hand City? Yeah, unfortunately recently I haven’t been able to like hop in too much to play ICE Poker with the community. Just given the fact that we’re just trying to ship so many parallel items. But, we host community events almost daily. Our community events manager, Murph does a great job of bringing in artists to perform, live concerts, as well as even, like, comedy shows within our venues. And they’re streamed kind of on the wall in those venues. And, so, yeah, we … if you’re looking for community events, like, we have a bunch of them lined out on the events page of our website. But, yeah, in terms of the actual team hopping in to play in Diamond Hand City, we could definitely do that a bit more often. We just get swamped.
Jerry Sun (56:37): Yeah, totally understandable. The last question from the community – I guess right now everything is in Decentral Games and there’s, you know, in terms of metaverse, there’s so many metaverses being built out simultaneously. No one really knows which metaverse is going to be the winner-take-all, or, like, how that’s going to work. Any future plans, any future thoughts on, maybe, like, expanding to anything else? I see some people saying Otherside? That was just, kind of, this thing occurred recently, right? What are your guys’ thoughts on that?
Miles Anthony (57:08): Yeah, it’s been a point of discussion for a while. Pretty much since we started DG. You know, ‘Is DG going to move to other metaverses?’ Initially we weren’t going to. Really because of the just, like, the requirements for our games. A lot of these metaverses that popped up, or virtual worlds that popped up, didn’t
really have any SDK with, like, custom scripting with the ability to, kind of, code like a poker game. For example, a lot of them, kind of, were more geared towards the drag-and-drop development experience with not a lot of custom logic. But, yeah, more recently we’ve seen a lot of them pop up that could potentially host our games. So, yeah, we’re considering – we’re looking at – you know, other platforms to expand ICE Poker. And, yeah, one of them that, you know, even Ryan is really excited about is the Otherside. So, trying to figure out more information and really eager to look at their SDK once they release that. Not really sure what the timeline is per se. But once we have that, we can really map out a game plan, if appropriate.
Jerry Sun (58:23): Cool. Good stuff.
Ryan De Taboada (58:26): Yeah. We’re waiting for another metaverse to be ready for us.
Jerry Sun (58:32): I like that answer! I like that answer!
Ryan De Taboada (58:33): You have an open SDK, etc.
Jerry Sun (58:38): I like that answer. It sounds like there’s avenues for growth. Whether it’s waiting for a metaverse to be ready for games, or the mobile app and things like that, and some of these features you guys are working on. So, definitely exciting times. It’s cool to see, kind of, daily and reducers continue to increase all these, you know, good metrics, kind of trending in the right direction. So, yeah. I think we’re about to hit an hour here. So I think we can wrap things up. Appreciate you guys calling in and appreciate everyone on the call, kind of, following along and asking questions.
Ryan De Taboada (59:15): Awesome. Thanks for having us.
Miles Anthony (59:17): Yeah, thank you so much for having me.
Mihai Grigore (59:19): Thank you, bye guys.
Jerry Sun (59:21): Thanks, Ryan. Thanks, Miles. Take care guys.
