- With inflation running at 10-month highs in Argentina and eroding the value of local salaries, the country has become a hotbed in Latin America for play-to-earn blockchain games.
- But it’s not all fun and games for players in emerging markets, some of it has a business element to it as well.
Last year, the massively popular blockchain play-to-earn game Axie Infinity made headlines as a combination of rising cryptocurrency prices and a collapse in incomes because of the pandemic saw players from emerging markets relying on the game for an alternative source of living, sometimes even exclusively.
From the crypto-savvy to the clueless, millions of players in emerging markets such as the Philippines and Vietnam collected and reared the cute Axies and the non-fungible tokens associated with them, and making an income sometimes in excess of their previous jobs in the process.
Now with inflation hitting 6.8% in the United States, people in the rich world are having to face the same sort of price pressures that those in emerging markets, especially places like Argentina, have had to contend with for years.
With inflation running at 10-month highs in Argentina and eroding the value of local salaries, the country has become a hotbed in Latin America for play-to-earn blockchain games.
According to data from Decentral Games, the metaverse company with the most players in the world, South America’s second largest economy has leapfrogged to become the world’s fifth largest user base for play-to-earn games globally, while Brazil has jumped to seventh spot.
Both Brazil and Argentina struggling under the weight of double-digit inflation.
In Argentina, prices are growing at a pace of more than 50% annually and wages have grown below inflation for the last four years, while in Brazil, inflation doubled last year to 10% annually, increasing pressure for workers to make ends meet and leaning on play-to-earn to provide additional income.
Within Latin America, Argentina, Brazil and Venezuela are the countries with the most number of Axie Infinity players, where players earn cryptocurrencies by winning collecting and rearing Axies and then winning battles with them.
But it’s not all fun and games for players in emerging markets, some of it has a business element to it as well.
It’s estimated that most Latin Americans play on behalf of Americans because they cannot afford the initial cryptocurrency payment to open their own accounts to start playing.
Several gaming platforms, including Decentral Games, Axie Infinity and Sandbox require users to already have NFTs to play, and users typically buy “NFT delegations” or rent out their NFTs to other players who don’t have the startup capital to buy in.
But Latin America is hardly the only region where play-to-earn games are catching on quickly, for instance, Axie Infinity’s fastest growth is coming from Asia, with Latin America coming in a close second.
Asia and Latin America have both gone through fairly recent periods of high inflation and wages there have generally stagnated.
With the Russian invasion of Ukraine ongoing and putting upwards price pressure on food and fuel in Europe and the U.S., inflation may start to hit harder, especially as wages stagnate – which means that more players may come onboard to these play-to-earn games, not just for entertainment, but as a means to supplement their incomes as well.
