The GameFi industry started in 2013 and had a gradual development until 2020. But in 2021, the popularity of decentralized games highly increased with the development of blockchain technology as well as the hype in NFT market. During the last couple of years, blockchain-based games have attracted many new users so that the total value of the most popular blockchain games, such as Axie Infinity, significantly increased.
However, some are more critical to join the market due to reports about toxic blockchain games. As you already know, NFTs play an essential role in blockchain games and almost all assets, weapons, wearables, accessories, etc. are created as NFTs and can be sold in NFT marketplaces. All of us might have read the frequent news on NFT scammers and frauds. Therefore, gamers seem to be logical to be careful about the blockchain games they choose to play. But the question is how to identify the scams!
In this article, we aim to have a closer look at the topic and, hopefully, suggest some key points to identify and avoid scam blockchain games.
What is NFT game?
As the name suggests, NFT games are games that use non-fungible tokens. Rather than just storing crypto-collectible items in your wallet, NFT games require players’ interactions, the purchase of avatars and weapons, and the ability to generate income from NFT games through a play-to-earn model.
NFTs play an essential role in driving growth in the gaming industry. NFT developers can get profit from their work. They also allow players to earn money simply by interacting with them. Besides, NFTs use blockchain ledgers to validate unique digital collectibles, which is a key element for the performance of NFT games. Some NFT games, such as CryptoKitties, have already releases on the Ethereum blockchain. Therefore, they can include NFT characters, which allows players to buy virtual assets, like cats in CryptoKitties, add them to their collections, or sell them. As the result, blockchain technology can be used for entertainment and leisure activities as well as making money.
How do NFTs fit into gaming?
The primary step to learn about GameFi is to know deeply about NFTs and their integration with smart contracts. An NFT is a unique digital asset that lives in a blockchain through a smart contract and its digital transactions is recorded in the blockchain.
The smart contract is associated with the NFT. Smart contracts are short piece of codes related to a certain NFT. These code can be things like a link that leads to a JPEG file stored on a central server. Indeed, a smart contract is the identity code of an NFT. Therefore, it can be used to manipulate an NFT object between games. Since smart contracts do not include a model, textures, description, sound, animation, etc., each NFT can be easily transferred from one wallet to another.
To transfer NFTs between games, these games must be built, run and maintained through a single infrastructure or blockchain, like Ethereum. In addition, an NFT game works best based on its number of users within its own economy. Accordingly, players can buy and sell in-game items in the form of NFTs using a native cryptocurrency.
Therefore, NFTs have no value by themselves unless the owners or developers convince users that NFTs are so unique and rare that can help them add excitement to gaming and provide them some profits.
How do NFT games work?
NFT games combine traditional gaming architecture with modern gaming designs, including modern technologies such as NFTs and blockchains. The combination allows users to have greater control over in-game digital assets such as characters, weapons, skins, virtual areas, etc. Besides, NFT token standards for in-game assets help developers maintain the rarity and exclusivity of their NFTs.
NFT games are designed based on the play-to-earn NFT model which allows users to develop an income stream. Players get higher chances of profit if they play more frequently and for a longer time. As a result, the rewards are competitive as well as monetary.
Furthermore, NFT game players always look for rarest NFTs to gain more rewards in games. In fact, NFTs are valued based on the advantages they provide to their holders and how much people want them.
How Do NFT Scams Work?
NFT fraudsters use a variety of phishing cons to get access to NFT accounts. If they access the accounts, they immediately drain it before the owners notice the scam.
Scammers also may create a fake or worthless NFT project. They use social media accounts. In most cases, they hack or buy verified social media accounts or accounts with thousands of followers, usually on Twitter or Discord. These accounts, then, are used to advertise fake NFT projects. They usually have an army of accounts or bots to make comments supporting the project, make replies, retweets, and tag other users. Scammers also may send links that contain malware designed to help them hack into players’ computers and find passwords of accounts.
NFT gaming scammers may use the rug pull scam technique, too. In this case, promoters use marketing and advertisements to attract buyers or investors. When some money raises from the sale, they suddenly stop trading activity and disappear with the money. You might have already read about squid game token scam which was inspired by the popular Netflix series “Squid Game”. After marketing the it as a play-to-earn game, they ran away with over $3 million.
Such scams related to NFTs suggest players and investors to be careful when engaging in NFT games.
How to spot a scam NFT game?
NFT scam games usually come in large scales and are previously designed. Many of the investors in such projects are beginners, and scammers tempt them with the help of advertisements and beautiful sites. Therefore, users should be very careful about the games and NFTs and always check the following details in each.
1. The project’s team
Developers of professional projects always are known online with a number of projects. Their names and professional information can be easily found on the Internet, with a track record of their successful projects.
there are also several serious projects in GameFi that are launched by anonymous teams. Although there is little information about them, due to using nicknames or pseudonyms, their length of activity in NFT gaming and NFT market could show if they are not scammers.
2. Reviews on professional platforms
NFT game players and investors should not merely rely on advertising slogans. They must read reviews about NFT games on independent professional platforms. The blockchain community quickly share their knowledge and information about new projects. News sites analyze new games from all sides and offer comprehensive reports.
However, NFT players and investors must be careful about what they read online as scammers have learned about deceiving users. Some scammers write positive reviews about the fake projects on third-party sites. They run hundreds of accounts on social media to leave supportive comments about a project. Therefore, investors should not merely rely on reviews alone.
3. Smart contract
Users can check a project’s smart contracts using resources such as Etherscan or BscScan. The block explorers offer information about when the project was created, launched to the market, its users, and how many tokens were issued.
Besides, it is always helpful to use the smart contract to check the genuineness of an NFT game. Resources like BscScan and Etherscan provide the necessary information about a project launched in the market.
Twitter and Discord are the major platforms where users can read the viewpoints of NFT communities. Users should monitor projects on these official social networks to see how people interact with them through comments and chats. However, this is not the most reliable way for verifying the authenticity of a gaming project.
Remember what we already said about false followers increase the size of an NFT game community. Always check when the communities are created rather than their number of followers.
6. Project roadmap
A roadmap should show the goals and future desired results of a project. It should include the practical steps and milestones needed to reach the pre-set goals. The road map should be clear and easy to understand, flexible and introduce the bigger picture and the solutions it brings.
However, a roadmap only reveals the creators’ goals and expectations for a project, and it soes not guarantee if the goals are all met. An overly ambitious project that seems too good to be true can be a warning. In addition, avoid investing in a project if you are not confident in its long term viability.