REVV Racing (RR) is a web-based arcade-simulation racing game developed and published by Animoca Brands. The game has been playable for approximately a year, is built on Polygon, and its economy is run via a bunch of tokens that we’ll dig into further down.
When the game was about to launch in August 2021, Yat Siu, co-founder and chairman of Animoca Brands, expressed his high hopes for the game: “REVV Racing is not going to be your typical blockchain game: we are merging the thrill and skill of real-time 3D car racing with the advantages of blockchain, including true ownership of in-game assets, play-to-earn, and enhanced security. The future of play is games with the look and feel of the high-quality products that gamers are accustomed to, but that also empower players with digital property rights.”
Did the game live up to those expectations, and is it positioned for long-term success? That’s what this essay looks to answer. To start, however, let’s put the game into more context and look at the high-level data.
RR is part of the REVV Motorsport ecosystem, which so far includes three pillars — RR, Formula E: High Voltage (a racing management game), and MotoGP Ignition (card collectibles with a few game modes) — but RR appears the most organized at present. It’s also worth mentioning that Animoca Brands previously ran another racing game, Formula 1 Delta Time, but after losing the Formula 1 license, the team had to shut down the game and let users swap their NFT assets for comparable ones inside the REVV Motorsport ecosystem. It was also a lesson learned for many regarding how “true” NFT ownership really is when reliant on IP that one doesn’t control.
In terms of engagement data, the numbers — like most blockchain games these days — are rather bleak. According to DappRadar, over the past 30 days only 2.2k unique wallet addresses interacted with the game, and transaction volumes were only $9.2k. We should always take DappRadar’s specific numbers with a grain of salt, but however you slice it, the numbers aren’t encouraging, and we can see the game’s broader slump in the chart below:
In other words, it’s pretty clear that RR — and the broader REVV Motorsport ecosystem — is on shaky footing. That alone likely calls for high skepticism, but it’s still worth taking a deeper look. After all, it offers us a lens to think about racing games in a web3 setting, and there are still lessons to learn (good or bad) from how the team approached its game and economy designs.
Let’s see what we can learn, starting with the tokenomics.
It’s pretty clear that Animoca Brands, both within the REVV Motorsports ecosystem and more broadly, is still figuring out best practices regarding web3 game economy design. You can see it in the changing language around these racing games (from play-to-earn to play-and-earn… and we’ll see what’s next) but also in the media, such as in our recent podcast conversation with Animoca Brand’s Jesper Lindquist.
However, despite still figuring out best practices and the fact that the game serves a tiny audience, the team has put together a rather complex token economy. RR now boasts four tokens — one non-fungible and three fungible — and let’s briefly hit on them one by one. After we understand the primary tokens and economic drivers at play, it will be easier to dive into the intricacies of the game design.
REVV Racing Cars
The game’s NFTs are the cars that players use to race in tournaments and events. These cars have varying rarities and performance tiers — Entry, Common, Rare, Epic, Legendary, and Apex. If you browse OpenSea, which RR’s website points players to in order to buy their first (or additional) cars, you can pretty quickly see that there’s limited volume and a floor price of only 0.001 ETH. It’s not incredibly inspiring, but being a play-to-earn game, the cars are needed to earn other types of tokens via in-game races.
Catalysts (CATA) are fungible tokens that are used primarily in the game’s fusion system, which is a relatively new car upgrade mechanic introduced to the game. Each car has a fusion tree — an upgrade map of sorts — that defines how that car can be upgraded. In order to use the fusion system, the player will need the starting car NFT, some Catalyst tokens, and some REVV tokens (more below).
The NFTs and fungible tokens needed to generate a new car through the Fusion System are listed in a Blueprint and are made available to all car owners without the need to obtain them separately. The newly generated cars can have better stats and be more scarce, and also have access to their own Fusion Tree.
As of November, Animoca had no plans to sell Catalysts; instead, they can be created via yet another fungible token called Shards.
Shards (SHRD) is where the play-to-earn nature of the game comes in. Shards are earned simply by completing races, and more specifically, what a player earns is based on the length of the track, the number of laps, the rarity of the car, and the size of the entry fee. In order to earn something, it doesn’t matter if a player wins, just that they finish (Animoca calls this “proof of play”). That said, basing earnings on the quality of an asset and the size of an entry fee does push the game a bit closer to a pay-to-win dynamic, where spenders are able to upgrade faster and presumably win more.
In short, after earning enough Shards by completing races, those Shards can be converted (destroyed) into Catalysts, which, again, are used in the fusion system.
Over time, Animoca Brands has tweaked how it views the role of Shards. In August, the team published an updated Shards game plan, which also more clearly distinguishes the primary in-game earning token across the REVV Motorsport ecosystem. You can get more details here.
REVV tokens are the primary utility tokens of the game (Animoca seems to shy away from using the term ‘governance token’), and they’ve been live for two years. Within RR, REVV is the token by which players pay to enter special tournaments and events where the earning potential is higher. Also, similar to Shards, REVV is an ecosystem token; in fact, it was the ecosystem’s original one, and you can see the high level allocation here:
Its role as an ecosystem is now slightly devalued given that Shards is the primary currency to earn, but that separation, despite the complexity it adds, should help REVV from getting as rapidly diluted.
Of course, it’s not that it overly matters given the small player base and REVV’s minimal market value. The REVV token is down 97% from its highs, and only trades at a $4.7M market cap (or a $51M diluted market cap). It’s also hard to properly build and plan out the economy of an ecosystem when you don’t know what new games are going to be like and you are forced to fold other players in (like when Formula 1 Delta Time shut down and those assets transferred over).
On a very high game design level, RR’s gameplay experience falls somewhere between a casual racer (like Need for Speed) and a racing simulator (like Gran Turismo). While it graphically, thematically, and physically tries to achieve the fidelity of a racing simulator, it ultimately plays like a casual racer, and Animoca knows this. Given Animoca’s broader goal of building a racing titles ecosystem powered by a single token, it would be unfair to criticize RR’s gameplay execution from a racing simulator lens. But if we were forced to compare its gameplay to another title, it would likely be one of the racing titles from the 90s, such as Need for Speed III: Hot Pursuit or one of the NASCAR racing titles. Check out the gameplay video below.
In a nutshell, we’re not blown away by its gameplay. One could argue that the gameplay is good enough for Animoca as they try to prove out an ecosystem token strategy. But to do that, not only do they require many players playing across the ecosystem (not really the case at the moment), but every game’s design and economy should be robust and scalable too. This is where some cracks in RR start to appear.
#1: Onboarding is Smooth, but not Frictionless
The onboarding flow for new players of RR is a three-step process, as seen below. For a crypto-native player, these steps would look very familiar. But for anyone new to crypto gaming, getting into the game can be a slightly tedious process. It took us ~10 minutes (!) to get everything set up before our first race.
That said, the three-step process is generally quite smooth versus other games’ onboarding experiences. For starters, the game works with the widely used MetaMask wallet, which already reduces any new wallet installation friction for a majority of crypto-native folks. Second, acquiring REVV and MATIC isn’t a major headache, as RR uses a mix of MoonPay, QuickSwap, and Transak to facilitate these purchases and conversions. All three service providers are pretty UX-friendly from a mass market perspective, but yes, there are a lot of clicks involved regardless of whether you’re crypto-native or not. And third, purchasing a car off of OpenSea is also a less than 5-click process, as long as you have enough of ETH or REVV to make the purchase. See the tutorial video to get a feel of what we mean.
While RR’s onboarding isn’t the smoothest we have seen, it’s a huge step forward from many 2021 and early 2022 crypto games. In other words, it is clear that Animoca prioritized smoothening onboarding UX (a key issue in crypto-gaming today) while building out RR, and it will likely continue to do so for future titles.
#2: Core Game Loop is Simple, though Economically Harsh
On paper, the core is a tight Choose/Buy Car → Enter Event → Race loop, but engaging with this loop can get quite heavy on the wallet quite quickly. Let’s break that down.
In order to race, every player needs a car. And since every car is a NFT, these need to be purchased with either REVV or ETH from OpenSea.
But just owning a car doesn’t guarantee a player will be able to race with it. There are two types of Events - Tournaments and Car Specific Races. The former allows any car to participate. But the latter has its own car requirements, which means players not only need to own a car, but also need to own the right car to participate in the Car Specific Races. While we were playing the game, 3 out of the 4 active Events were Car Specific Races.
Herein lie two monetization choke points, and the monetization pressure is pretty obvious:
- Buying the first car → this is required to even start playing the game in practice mode
- Then potentially buying more fitting cars → this is required to ensure one can actually participate in the Car Specific Races
Next, to participate in an event, the player needs to spend some REVV per race attempted. Players who regularly win Events (and thereby REVV tokens) don’t fully feel this monetization pinch, but there are only a few winners (currently 200) in every Event, and the lower the winning rank, the lower the amount of REVV won. Therefore, a vast majority of the players have to keep purchasing REVV from the open market to continue engaging with the Events and the monetization pressure continues to grow. That said, the impact of this scenario only grows as the population of players trying to play and win REVV from it also grows, which brings us to the next point.
As previously mentioned, every Event has a REVV prize pool attached to it. While this prize money would ideally be fully sourced from players spending their REVV to race in the Event, it seems like the current total player volumes don’t allow it completely. Therefore, it is quite likely that Animoca itself is using some portion of REVV’s Game Operations token allocation to fund these events and introduce more REVV into the ecosystem. For example, the event showcased below has a total prize pool of 3,000 REVV that is shared by the top 200 players. But it seems like less than 100 players have even participated, which means every player really only needed to spend 1 REVV to attain a top 200 position. That equates to a total player funded prize pool of 100 REVV, while the total winnings for them are ~1,400 REVV.
Even though the above example doesn’t support the economically harsh reality of the game’s core loop, Animoca’s ambition is to have many more players playing the game. But to allow more players to join and regularly engage with the game over long periods of time, the economic layer of the core loop’s design will need to be reevaluated and eventually made less harsh.
#3: Gameplay Creates a Wide Enough Skill Differential Between Players, but Limits Audience Growth due to Theming
One of the great things about the racing genre is that the more realistic the racing experience gets, the higher the skill ceiling it creates for players to master. And the higher the skill ceiling that exists, the wider the spectrum on which different players with different skill ratings sit.
As mentioned before, RR’s gameplay experience sits somewhere between that of a casual racer and a racing simulation. Therefore, the gameplay automatically creates a high enough skill ceiling for the game to justify a prize pool economic model. This is a really great way to ensure you have a zero sum game versus a positive sum environment like Axie Infinity.
But as stated before, the number of players currently playing REVV Racing is pretty miniscule. And so even though the gameplay is fertile for a zero-sum environment, it seems like almost everyone participating in races is winning something. To be clear, this isn’t a structural problem with the game - just that the game desperately needs more players to fully take advantage of creating a wide skill differential spectrum and truly unlocking the economic power of the prize pool model for players, RR and Animoca.
This is where the game’s theming comes in. The game looking like a racing simulator is a double edged sword. There is quite a high chance that this choice of theming is severely limiting audience growth just because the racing experience looks too “serious”. To prove our point, here are the lifetime copies sold of three racing games in descending order of casualness -
- Mario Kart (highly casual and Mario IP) - 152M copies
- Need for Speed (relatively casual and with the zeitgeist) - 150M copies
- Gran Turismo (very realistic racing simulator, and closest looking to RR) - 85M copies
We completely understand that fully attributing the lifetime copies sold of these games solely to their choice of theming is not fair, but it is a fact that the racing simulation market is a small one compared to that of the more casual racers. And being perceived as a racing simulator within an already small blockchain gaming market cannot be doing RR much good from an organic audience growth perspective.
#4: The Fusion System is Not Built for Economic Sustainability
As we covered in the tokenomics section, all RR cars are NFTs that exist in a range of rarity and performance, ranging from the entry-level Common tier to the exclusive Apex tier. Outside of a single Apex car and a small handful of Legendary cars, the remaining cars available today are in the Common tier. But RR is looking to change that with the Fusion System, which, as you remember, is the primary mechanic that grants access to higher rarity cars. To perform a Fusion action, players need a car NFT, some CATA, and REVV tokens. And as previously discussed, SHRD is required to create CATA.
The question is - why so many tokens? And does this design in some way improve the game’s economic sustainability? The short answer is no, and here’s our thinking.
First, allowing a car NFT to be upgraded into a better one is a great player experience. But from an economic sustainability perspective, this Fusion System design doesn’t really help with controlling the supply of cars, since the total car count across the marketplace will always remain the same after a fusion action. The reason this is poor economic design is because, as the numbers of new players entering the game and existing players moving up their Fusion Tree increase (which will also result in existing players getting more attached to their newly generated cars), Animoca will find the need to mint new cars to allow new players to play. Over time, that will increase the car NFT supply in the market and thereby negatively impact floor prices. And the loop will continue. The simple fix to this would’ve been to allow a fusion action only with two cars, but that design would need to evaluated in conjunction with the high monetization pressure already existing in the game.
Second, it’s quite possible that Animoca understands the first point, which is why the company decided to choke the number of fusion actions with adding a CATA and REVV requirement to it. But CATA generation is connected to SHRD supply, which is connected to how deeply a player engages with the game, which is connected to how much REVV they have. In other words, RR ultimately chokes fusion actions with REVV and that brings into question the significance of CATA and SHRD itself.
Third, since Animoca has mentioned that CATA could be listed on a DEX, this also means that players will be able to purchase CATA without having to engage with the game, produce SHRD, and convert that into CATA. Therefore, even if Animoca wanted to incentivize greater engagement with the game by introducing SHRD and CATA, allowing CATA to be tradable completely kneecaps the engagement-driving purpose of SHRD.
Fourth, since CATA can be generated only through SHRD, and SHRD is an engagement-dependent currency with a theoretically limitless supply, that makes CATA a theoretically limitless supply currency too. That means RR will likely start to see SHRD farmers enter the game (as long as the price-to-profit potential justifies it), flood the market with CATA, and continue to extract value out of the game until the price of CATA completely tanks. Smells a lot like SLP from Axie Infinity, and we really wonder why Animoca decided to make CATA/SHRD ERC-20 tokens versus just simple in-game, off-chain currencies to help shield the engagement driven economy from free market forces.
Clearly, there exists a potential hole in the Fusion economy that is rooted in CATA’s design. In other words, it will be easier for players to perform fusion actions if the economic hole is exploited. This is especially dangerous when the highly skilled players realize it, because they will also have ample REVV through winning Events. Therefore, they could in all likelihood perform fusion actions very easily, move up their Fusion Trees very quickly, and eventually become unstoppable on the race track — talk about being pay-to-win in a game that’s supposed to support a high player skill differential. Not only will that disincentivize new players from joining the game (since they’ll quickly realize that they have no chance to win), but it will also result in the accumulation of REVV in the hands of the highest-skilled players. That also means that their need to sink REVV will reduce over time, and Animoca will be pressured to release more REVV into circulating supply, which will then bubble back up to the highest-skilled players and eventually tank the REVV economy.
All that said, we should keep in mind that RR’s economy is already in a very weak spot. While the economy design might be flawed, it almost doesn’t matter at this point because there are so few players and there’s barely any value to extract out of the system. Therefore, bad economy design can’t make the game’s success much worse, but it will need to be fixed if RR’s gameplay starts resonating with a larger audience or if Animoca starts a dedicated user acquisition effort to get more players into the game.
Based on current engagement data, it’s hard to be bullish on RR and the REVV Motorsport ecosystem. Something major would need to change to attract more users, and there’s little sign of what exactly that would be right now. The team continues to test new events and partnerships within the game and around the ecosystem, but none of it appears to be moving the needle. Plus, the team has taken a rather complex approach to economy design (four token types!) before attaining any real, sustainable traction. Not only is that complexity going to be difficult to manage over time and require lots of attention—if anything, we’re already seeing holes in the economy design—but it likely would’ve been a better idea to first run off a simpler economy design while building a successful game and then add any complexity on later if needed. The same idea stands at the ecosystem level, too — what’s the point of multiple ecosystem tokens if there’s yet to be even a single successful game in the ecosystem? It’s backwards!
It might be a long shot, but to move the game in a direction where maybe it has a chance of attracting more users and surviving, the key would lie in - 1) moving towards frictionless onboarding so that user acquisition budgets can be spent wisely, 2) continuing to optimize the racing gameplay and potentially providing more casual racing modes that helps with attracting larger audiences, and 3) addressing the fundamental economic issues with the Fusion system as soon as possible and before it’s too late.