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#1: The Sandbox Lays Out Land for 2023

The Sandbox has published its Q1 LAND Owner Roadmap Update for 2023 to provide current and prospective landowners with insights into the anticipated progress for the year. As interest in "metaverse land" declines, it's an opportune moment for The Sandbox to maintain the engagement of its nearly 24,000 land NFT owners. While many roadmap milestones are scheduled for later in the year (Q3 and Q4), there are also several noteworthy updates taking place sooner.

Regarding current updates, the recent release of the Game Maker tool version 0.8 took place at the end of January, and weekly staking rewards are available for SAND and Land owners. Exclusive NFT and SAND rewards are offered to Land and official collection Avatar holders, while the April Festival is ongoing, and more frequent communication is promised. As for future plans, self-publishing is expected to be fully accessible by Q3's end, and by Q4's end, users will have the ability to mint assets (avatars, equipment, objects, etc.) as NFTs on the blockchain with new features. There are still many questions about upcoming events after April, including the potential for an Alpha Season 4 or a Beta Season. As with many web3 games and platforms, land ownership value continues to grow at a gradual pace.

To provide context, let's discuss the current state of affairs concerning updates for creation. At present, general landowners cannot visit or build on their land; it exists only as an NFT that can be staked or sold. Each land plot does have a location, which presently only serves to assign a logo image and group adjacent plots into estates (primarily for larger logos). This makes the upcoming self-publishing feature essential for landowners to derive tangible value from their land. The Sandbox plans to introduce an allow-list of landowners permitted to self-publish during Q2, eventually extending this capability to all landowners by the end of Q3.

Concerning publishing, The Sandbox currently does not intend to enable players to seamlessly walk from one person's land plot to an adjacent plot owned by someone else. Landowners will be required to utilize the Game Maker tool to construct their land's content and publish it to the respective land or estate plot. This highlights the significance of the Game Maker update to version 0.8, which introduces new features such as enhanced multiplayer gaming, emoting, lighting, visuals, and audio/video streaming.

Crucially, version 0.8 introduces the ability to publish from Game Maker to the "Draft Gallery" as a "Social Hub," which enables users to invite others to join and socialize within custom-built spaces without needing land for testing. The audio/video streaming feature is highly anticipated, as it supports recorded performance playback and watch parties — two early metaverse social attractions. However, currently, the audio/video streaming feature requires files to be hosted by The Sandbox, which is exclusively available to partners and studios for the time being.

A crucial publishing feature in Q4 is the ability to publish assets as NFTs to the blockchain. Creators can use VoxEdit to develop various assets, such as avatars, equipment, and objects, which can then be used in Game Maker alongside existing marketplace items. However, currently, only select creators have the ability to publish assets to the marketplace for sale as NFTs. The constraint of experience and asset publishing to partners and select creators can be addressed through two approaches.

The first approach to publishing involves participating in numerous game jams organized by The Sandbox in collaboration with various partners and brands. To enter these competitions, experiences must be published to the Draft Gallery using specific naming conventions. The second approach requires applying for an agency/studio partnership through The Sandbox Partners Program. This program maintains a directory of agencies and studios, assisting brands and businesses in finding talent to create experiences for them. Applicants for the Partners Program must pass VoxEdit and Game Maker tests to verify their skills. Several game jam winners can also be found in the Partners directory. Additionally, The Sandbox offers a Game Makers Fund initiative to financially support game creators, which is open to all applicants.

Other significant aspects of the roadmap update revolve around various rewards, primarily aimed at incentivizing holding. First, a 100,000 $SAND weekly reward pool is available for $SAND and land staking, lasting 13 weeks from April 4th to July 4th. Additionally, exclusive monthly NFTs will be granted to landowners who have held their land for more than three months. Considering the gradual pace at which landowners will gain access to use their land, these rewards may serve as a means to appease them and deter them from selling.

Although land prices haven't reached rock bottom, floor prices have indeed declined compared to a year ago when they reached highs of $5,000 to $7,000 before dropping to around $3,000 in May 2022. This year, prices have consistently remained below $2,000, and at the time of writing, they have even dipped below $1,000. Intriguingly, just two days after the roadmap announcement on April 11th, The Sandbox experienced the highest number of land sales in a single day in the past year, with 218 lands sold and a total secondary market volume of $182,000. It appears that the roadmap may have influenced land interest to some extent. The price of $SAND has also decreased, falling from all-time highs above $7 to just above $1 in May 2022 and now fluctuating below $1 since two days after Alpha Season 3 commenced last year.

The final noteworthy aspect is the April festival, which runs from April 5th to May 2nd. The event features an array of prizes, including $SAND, NFTs, and even land. Interestingly, however, 50% of the rewards are reserved exclusively for land and official avatar owners. The peculiar part is the inclusion of avatar owners, as the floor price of an avatar (about $20) is much lower than that of land. While owning an avatar does indicate a more than casual interest in the platform, landowners might feel somewhat undervalued by being grouped with such low investments.

Distributing prizes has been a crucial strategy for The Sandbox to maintain interest in its alpha platform while organizing events and expanding partnered content to encourage adoption. Alpha Season 3 attracted a total of 360,000 players during its 10-week run, with a 30,000 daily active user count, as reported by The Sandbox. The 11 million $SAND rewards offered during the season likely contributed to these figures, as well as the declining price of $SAND, with only 855,000 $SAND spent during the event.

Although The Sandbox has experienced a drop in interest, partly due to metaverse fatigue, it appears to be faring better than Decentraland, which recently suffered a 76% year-over-year decline in attendance for its fashion week event. So far, The Sandbox has offered a more curated experience, utilizing events and alpha seasons to generate periodic interest, while Decentraland and other virtual world platforms have been largely open but verging on desolation. The looming question for The Sandbox is whether the Q3/Q4 opening will lead to success or disappointment for land investors and players, and if the partnered content will suffice to sustain engagement until then.

The Sandbox has been leveraging its limited access and game jams to nurture talent. However, with competing opportunities for metaverse game creators in Roblox and the recent Fortnite Unreal Engine announcements, The Sandbox may find it challenging to retain skilled creators without a robust initial network effect. It is expected that land prices and sales will continue to decline at least until Q3 unless significant events or broader access to The Sandbox are introduced. Landholders will hope that the 2023 roadmap does not lead them to regret their investment. 

#2: Splinterlands Finally Lands Land

Splinterlands, which sold out all of its land plots for $20 each in the summer of 2021, has started to deliver on its land plans with a Phase 1 expansion called "The Secret of Praetoria." (You can find our full deconstruction of Splinterlands here.) 

The purpose of land in Splinterlands is to generate resources for crafting new card types, such as Items and Spells, in the future. While card and DEC staking for resource production is not yet available, the initial "Land 1.0" allows for land surveying, land deeds, land trading in the Splinterlands marketplace, and the possibility of SPS distribution, the game's governance token.

Initially, land in Splinterlands was sold as deeds without any actual content. This approach gave the Splinterlands team time to develop a comprehensive plan for the land's functionality and its contents over the past two years. With this plan in place, players can now claim their deeds and survey the land to uncover its contents.

Land in Splinterlands can be in one of three states: Unclaimed Deed, Claimed Deed, or Surveyed Land. The level of information available about the land differs depending on its state. Unclaimed Deeds have no information and are available on the new in-game market for $180 per plot, which is considerably more than the original sale price of $20 but less than the $600+ prices they once reached on secondary markets. Claimed Deeds provide only the location of the land, while Surveyed Land offers full details about its contents.

When a player claims a deed in Splinterlands, it becomes an unrevealed piece of land with a specific location on the game map. However, surveying is necessary to uncover its details, such as land type, geography, and rarity. The rarity of the land affects its price, with current listings ranging from $65 for Commons to $75,000 for Mythic Kingdom — Castle. The primary reason for this price difference is the production boosts associated with higher rarities, with boosts ranging from Common (0%) and Rare (10%) to Epic (40%) and Legendary (100%). Additionally, owners of Castles and Keeps have the ability to collect taxes from other landowners.

Surveying land in Splinterlands is not just a simple reveal. During the first 60 days of the surveying period, players can purchase Starter Packages with DEC (which will be burned upon purchase). These optional add-ons provide boosts during later phases but do not affect the surveying process itself. It's worth noting that the packages are only available at the time of surveying and cannot be purchased for a given land plot after surveying. This adds to the pressure for players to decide whether or not to purchase the packages during the initial surveying period.

The three starter package options are:

• Building in a Box: This package provides an initial building for land that won’t be available until Phase 2, but it will provide a head start over other players. 
• Time Vault: This package provides Time Crystal tokens that can be used toward construction projects. Unlike the other two packages, this doesn’t stay tied to a specific land plot.
• Unstable Totem: This package doubles the production rate for 30 days when Phase 2 begins. Similar to the Building in a Box, this is meant to provide players a head start. 

Although buildings and resource generation won't be implemented until Phase 2, the Splinterlands team has decided to introduce a Phase 1.5. This phase is aimed at jumpstarting initial land usage and resource production and is expected to be completed by the end of Q2 (possibly extending into Q3). Phase 1.5 includes Card/DEC staking, a production points system, and some resource production systems. To encourage players to claim and survey land during the approximately four months between Phase 1.5 and Phase 2, a proposal will be put up for vote soon. The proposal aims to distribute SPS governance tokens to landholders who survey their land.

Card staking offers an intriguing option to use cards in the game that are not currently being utilized. When cards are staked to the land, they are used as workers for building construction and resource production. However, staked cards cannot be used in player battles and take three days to be unstaked. Nonetheless, they still contribute to the Collection Power, which determines the player's league tier.

Although card staking provides a useful function for cards that are currently not in use, it may result in some cards being less available for purchase or rental. This could happen as players with good collections that are not actively playing may choose to stake their cards as workers instead of renting them out. Additionally, the card rarity also affects the contribution of staked cards to the Production Points, which could motivate players to hold onto rarer cards, thereby further limiting their availability. The prevalence of bots in the game may also prompt them to shift their inventory to card staking instead of playing.

To work on a land plot, certain resources are required. The first resource is a "Power Source," which can be obtained by either burning 5,000 DEC or staking a Runi PFP card as a worker (see our coverage of this here). A free Power Source is included in the Building in a Box starter pack. Each staked card also requires DEC to fuel it, with the amount depending on the card's level, with a maximum of 10,000 DEC per card. With a limit of five worker cards per plot, the cost of running a land plot can add up to a one-time payment of 5,000 DEC burned and 50,000 DEC staked, or approximately $52 at current DEC prices.

To keep the production going, workers need a new resource called "Grain," which is consumed by at a per-hour production cost. Grain can either be purchased or produced by workers who are staked for farming. This introduces a resource input requirement to balance production, regardless of the resource output. Grain can be traded, allowing players to create a player-to-player economy, with some players focusing on producing grain to sell to others who produce different resources. The amount of grain needed depends on the production points generated per hour, which is based on card rarity, gold foil, and whether the card belongs to older Alpha/Beta/Untamed sets.

The length of time it takes to produce production points ranges from 1,000 to 50,000 PP per hour. The rate of consumption is 0.01 Grain per PP per hour. Luckily, grain will be tradable on internal and external markets as well as purchasable from the game itself at 1 DEC for 1 Grain. At current DEC prices, that puts the worst case price at about $0.47 / hour for maximum production. Workers tasked with farming grain will produce it at double the rate of consumption (0.02 Grain / PP per hour) to create a self-sustaining workforce. There are also plans for grain refining in Phase 2 to produce a more efficient food source.

In addition to farming grain, there are two other options for resource production for workers: Mining SPS and researching Praetoria Secrets. The SPS mining system replaces the current reward system for landholders, who currently receive SPS tokens for holding land. The new system distributes SPS tokens based on the percentage of Production Points put towards SPS mining at any given time. This means that players who are mining compete with each other for rewards. However, this system prevents new SPS inflation problems. The Secrets research system is part of a broader system for Phase 2 that involves a global player contribution task. For now, it yields a new item called Research Tokens, which players will be able to use later. 

There are a few other systems in play, such as taxes that go to Castle and Keep owners, clearing land, prefix titles, an internal market system, and land resource transportation. All of these systems are covered in detail in the Phase 1.5 whitepaper. All in all, it’s clear the game’s current state resembles more of an idle game, where there are real-world costs associated with playing and producing resources, rather than introducing significant new gameplay elements at the moment.

While the ultimate objective is to craft new cards, it's currently unclear how the various aspects of the game will function in terms of profitability or gameplay value. As a result, it's uncertain whether this feature can be viewed as an investment opportunity, a means to utilize idle cards and surplus DEC, or simply a diversion. With the removal of DEC rewards for playing the game, DEC may begin to return to its soft peg of 1,000 DEC per $1. However, this also means that players who want to participate in this new feature may have to spend money out of pocket in addition to using their existing cards just to observe the numbers fluctuate. Furthermore, the feature won't be available for at least four months.

The idea of using TCG cards in alternative systems like the land gameplay and interoperability with other games — like the upcoming Soulkeep Tower Defense — is interesting from a web3 perspective. But it doesn’t represent the engaging gameplay needed to attract non-web3 players. While it's exciting to see land finally being implemented in games like Splinterlands and Axie Infinity, the fact that it took two years just to reveal the rarity and geographic type of players' land in these systems, which rely heavily on web-based transactions, is highly questionable. 

Designing the economics of these systems and ensuring their future viability is an uphill battle, and there is understandably disappointment in the web3 community when developers pre-sell NFTs for a system that hasn't even been fully figured out. Additionally, interest in the entire system is dependent on whether there is significant demand for the final output of Item and Spell cards, which is currently unknown. This uncertainty will likely fuel more speculative behavior, which doesn't really help solve the economic issues of web3. 

Upcoming Game Announcements

• Wildcard announced its Genesis WildPass will be minted exclusively on Magic Eden's Launchpad on 4/20. (Link)
• Planet Mojo announced an open beta for Mojo Melee. (Link)
• The Beacon launched play-to-earn weekly dungeons for its pre-alpha. (Link)
• Unstoppable Games announced it will launch its web3 sci-fi MMO Influence on Starknet. (Link)
• Applied Primate announced famed designer Richard Garfield in advisory role for its MegaForce game. (Link)
• FIFA announced World Cup AI League, an AI-powered NFT football game developed by Altered State Machine. (Link)
• Genopets announced plans to expand its NFTs to Bitcoin Ordinals. (Link)
• Boss Fighters, an asynchronous, one vs many, PC and VR game announced a partnership with Open Loot and signups for an Alpha Playtest. (Link)
• Three Towers Game Studio released more details on resources for its MMORPG, Ertha, including metals, minerals, and more. (Link)
• Fableborne announced a second playtest running from April 13th to April 16th. (Link)
• Alaska Gold Rush, an open-world mining metaverse, announced a release date of April 20th. (Link)
• Kitsumon announced its flagship MOBA battle game release date for later this year with beta testing starting in May. (Link)
• ZooGames revealed full details of its play and earn reward pool, GameStake. (Link)
• Animoca Brands signed a strategic advisory agreement to help Emergent Entertainment on the development and launch of MMORPG Resurgence. (Link)

Live Game Announcements

• WeMade PLAY released ANIPANG Match, a web3 take on ANIPANG 4 on mobile. (Link)
• Ev.io announced a partnership with Fractal for a series of tournaments in April. (Link)
• DeFi Kingdoms released a new feature on gene rerolling to support heroes crafting. (Link)
• Gods Unchained launched a two-week Siege of Raneko event to support the release of its recent Band of the Wolf set with exclusive rewards. (Link)
• Nakamoto Games launched NAKA 2.0 for a series of upgrades to the experience of its P2E game platform. (Link)
• Sorare announced an NBA Playoffs update with new rewards, schedule and game mechanics. (Link)
• Laguna Games launched a Season of Advancement event for Crypto Unicorns running from April 1st to June 30th with a milestone for each month. (Link)
• Netmarble announced a partnership with The Sandbox to create a ‘Netmarble IP LAND’ within its Korean-focused K-Verse including new items based on Netmarble’s IP. (Link)

Funding Announcements

• Bitkraft raised $221M for its second token fund with a target of $240 million. (Link)
• Razer announced an extension to its zVentures investment arm for a dedicated blockchain incubator. (Link)

Ecosystem Updates

• Reddit launched the third generation of its NFTs. (Link)
• Myria, a Layer 2 blockchain, launched its MYRIA token. (Link)
• Immutable X introduced Polygon-based building tools. (Link)
• Faraway and Novel Labs announced a partnership to create a city building game set in the Bored Ape “Yugaverse” called Serum City. (Link)
• Aqua announced a web3 publishing platform and embedded game marketplace. (Link)
• Solana announced its PlayGG game festival to take place in San Diego from July 18th-19th. (Link)
• Line Next launched a beta of its NFT-based 3D avatar platform AlphaCrewz. (Link)
• Looksrare announced major platform upgrades for V2. (Link)
• Gojira Labs announced “animatronic NFTs” that transform static NFTs into playable game characters. (Link)

Notable Market Moves

• Render was the big winner this week in terms of outsized gains with a 21.8% increase, competing mostly only with Floki for biggest 90D gains. The token seemed to benefit both from the sharp upswing of Bitcoin timing wise, but also positive sentiment on a successful vote to migrate to Solana, which passed with a 68% approval rate.

• While StepN still came out positive, it had by far the lowest increase thanks to a couple of heavy downward corrections. Diehard players seemed to find the Easter event disappointing followed up by a town hall update revolving around old concepts like achievements and badges that didn’t inspire confidence in the project. 
• Magic also managed to shake its recent corrections and ended up gaining 5% this week over positive sentiment around earning in The Beacon and some positivity toward Bitmates.
• As always, we recommend looking and thinking long term. Larger financial market movements tend to trigger movements in crypto in general, which also affects gaming tokens. 

Content Worth Consuming

• Why Nexon thinks blockchain will make MapleStory “even more fun” (Blockchaingamer): “I believe that the biggest advantage of integrating blockchain technology into existing games is the ability to transform game items into NFTs and use them seamlessly across the blockchain without any limitations. This means that game items, which were previously only accessible within only one game, can now be utilized dynamically in third-party apps and other external tools. By breaking down the boundaries between the game and these external apps, the possibilities for acquiring and modifying items become endless, creating a more diverse and expanded ecosystem. This open IP ecosystem can also unlock new genres in the gaming industry. We strongly believe that blockchain technology and innovative design can make this a reality.” (Link)

• Generative AI might make interoperable game items more viable (Game Developer): “A generative AI workflow (probably one that doesn't just reduce everything to that Midjourney mush) might help solve that art direction issue. Taking Li's thought to a functional end, this feels like a feature you'd want to implement if players had legitimate attachment to items--actual intrinsic value that isn't just monetary in nature (Neal Stephenson had some interesting thoughts about this at DICE last month). The transferability itself wouldn't be what makes the item worth importing, it would be whatever feature (like customization or sentimentality) that makes the effort worthwhile.” (Link)
• Can Joy be Financialized as a Positive-Sum Game? (Meandering Musings): “Joy premium is a commodity, unbounded by any measure of intrinsic value (e.g., discounted cash flows for equities). Properly constructed, its upside is enormous, and the redistributive wealth effects it creates will be without historical precedent. The key word here is ‘properly constructed’ — what we need is a playbook for how joy can be financialized as a positive-sum game.” (Link)

A big thanks to Devin Becker for writing this update! If Naavik can be of help as you build or fund games, please reach out.