Introduction

Skyweaver is a free-to-play, browser- and mobile-based blockchain game in the “Hearthstone-like” genre. The game is being developed by Horizon Blockchain Games, a company founded in 2017 by CEO Peter Kieltyka along with Chief Scientist William Hua and Head of Operations Ian Ha. Kieltyka brings the entrepreneurship experience, having founded two companies with exits previously (Pressly and NuLayer Inc.).

Horizon has raised $13.3M in funding across 3 rounds, with Reddit co-founder Alexis Ohanian’s Initialized Capital leading the first two. The company has two primary products: Skyweaver and Sequence, a blockchain wallet aiming to reduce the barriers to entry for blockchain content and Web3 users.

Skyweaver’s closed beta began mid-2019, the soft-launch took place in late 2021, and the official Open Beta began in February of 2022. The game is currently available on app stores in addition to the browser, and the Android app has been downloaded over 100k times.

Horizon has made it clear that the company wants to focus on Skyweaver as a game first, which is refreshing compared to many NFT projects out there. That said, the NFT elements so far have taken a pretty distant back seat, to the point that the game’s blockchain elements feel tacked on and separate from the core experience. This approach will likely appeal to players but so far has served to limit the excitement and explosive advantage that a strong NFT implementation can create.

In this essay, we’ll explore Skyweaver’s game design, unique approach to card NFTs, impressive Sequence-driven onboarding process, the team’s decentralized protocol for token swaps, the game’s scalability challenges, and discuss what changes Horizon can make to set the game’s roadmap up for greater success. Let’s dive in!

Game Design Breakdown

Onboarding

Usually in this part of a blockchain deconstruction I would be tempted to launch into a description of the full forty minutes I spent trying to get the correct blockchain wallet set up, figuring out how to get the right currency to pay gas fees (while needing the currency to pay gas fees for the initial purchase), and then using CoinGecko to manually add the proprietary token to my Metamask wallet and hope I’m not getting scammed in the process.

Skyweaver, on the other, hand was no more complicated than signing up for any free-to-play browser game. In fact, it was easier than some. First you click on “New Account”; then you are given multiple options to sign in, either creating a new email/password account or using Google, Facebook, Twitter, Twitch, or Apple ID.

And… that’s it. A Sequence wallet (more on that later) will be automatically created with your credentials and is functionally invisible to the player until they decide they want to participate in the NFT elements of the game.

After that, a solid four-battle tutorial (including a few funny moments) immediately gets players into the game and walks them through the mechanics. The whole experience feels much more like a sophisticated, polished free-to-play game than the clunky, obtuse, and nerve-wracking process that most NFT games are willing to levy on their users.

Gameplay

The core of Skyweaver is a card battle game that can be described as a Hearthstone-like. Quite a few of the tropes that Hearthstone either created or popularized are in place: incrementing mana supply by turn, the drag-to-attack interface, the battle log along the left, and a fair number of the visual flourishes. That’s not necessarily a criticism; it means that the game feels familiar and accessible to the huge Hearthstone audience.

Fortunately, it also provides some new ideas, like the ability to attach certain spells and enchantments to units that have casting costs and can be used later. There are also new abilities that give the game plenty for Hearthstone veterans to dig into. The game feels like it extends the genre without trying to reinvent the wheel, and the result is a solid card battler. That said, the genre is also an extremely red ocean, and standing out from the crowd is a huge challenge for any new game in it.

When a new game starts, players select 4 cards to use in their initial hands.

The hand interface and battleground will look familiar to fans of the genre and generally plays out as one would expect.

The escalation of the mana supply of course leads to bigger and larger numbers of units being summoned, and it helps keep the game length shorter, which is generally going to appeal to a wider audience.

In as much as we’ve played the game, it seems fairly well balanced, varied, and contains interesting choices. That said, there are a few design decisions we would question.

For example, there is no cap on mana, unlike Hearthstone which caps out at 10. This likely helps games end quickly (average matches are under 15 minutes), but it can lead to heavy swings and more of an emphasis on luck in the end game. Then again, the fact that it can even be compared against Hearthstone puts it at a much higher tier as a game than the vast majority of blockchain games.

Also, the addition of new features like attaching spells to units — which builds on top of the use of typical card design traits (Guard, Taunt, etc.) — may increase the design complexity too much. Hearthstone debatably already skirts the limits of card design complexity to best maximize adoption, and Skyweaver takes it another step further. This doesn’t necessarily decrease the quality of the game (the differences are refreshing), but it may have a net-negative impact on adoption and competitive play.

Heroes

All 15 of the current heroes in Skyweaver are all identical in terms of hitpoints and abilities. They differ only in their “Prisms,” which are the 5 categories of cards.

A deck can contain either 1 or 2 different prisms, and the 15 heroes are simply the 15 different possible combinations of Prisms. So really, they’re just an aesthetic representation that shows your opponent which Prisms you are using. Notably, there are not any Hero NFTs at this time, though Hero Skins are on the roadmap.

Unlocking Cards and Heroes

As players participate in battles, they will gain XP and level up. The level does not affect player power at all, but each level up comes with unlocked cards (and, early on, unlocks new heroes). Players can get up to Level 15, and unlock 45 cards and all 15 heroes, by playing practice battles against bots. After that they need to participate in Ranked battles to continue leveling up.

Strangely, there is no formal concept of “rarity” in Skyweaver. Nearly all digital card games, even non-collectible ones like Slay the Spire, will clearly identify cards as varying from common to rare to epic. From a game design perspective, rarity serves a number of purposes. For example, new players can use card rarity as a rough indicator of power to focus their building efforts. It also eases balancing a bit. Rather than having to tune 500 cards to all be equal in power, they can be segmented into power tiers, allowing for more variability in design. There’s also just an inherent joy in opening up a pack and finding an impossible-to-find card.

Rarity would provide even more significant benefits for the NFT element of the game. That “hit the jackpot” moment is a lot more impactful if the jackpot has real, tradable value as well. It’s a straight-forward supply/demand situation — having rarer, more-powerful cards would both decrease supply and increase demand, potentially causing a price skyrocket. This is a substantial missed opportunity, and it will be interesting to see if Horizon decides to add rarity in the future.

That said, while rarity is not a property of a card, the cards do have varying drop rates. As of Patch #88, in which the team adjusted the drop rates of a bunch of cards, the easiest cards to find have a 1.37% drop rate, compared to 0.59% for the hardest. It’s unclear how these numbers are selected and what criteria determines when they need to be tweaked.

Conquest Mode

Most of the modes of play are familiar and self-explanatory — ranked, practice, tutorial, and private are standard options.

Conquest, however, is a bit different and worth explaining. In brief, Conquest is a pay-to-play 8-person single-elimination mini-tournament. The entry fee is either 1.5 USDC or a Silver Card, and prizes of Silver and Gold Cards can be earned by winning at least 1 match.

This is the one area of the game that could reasonably be considered a more typical “play-to-earn” system. Entry fees going to the winner as prizes can provide a sustainable, skill-based opportunity for fun and profit. So far, though, the mode is not getting a lot of attention from the blockchain community.

Participation in the Conquest feature has been pretty limited, with on average fewer than 1,000 players entering a Conquest each day (though averaging over 7 entries per daily player).

Tokenomics & Economy

Optional Participation

Somewhat similar to Splinterlands (which we covered two months ago), the blockchain portion of Skyweaver is entirely optional. With fewer than 5,000 total wallets ever transacting on Skyweaver’s marketplace, at this point the vast majority of players have not taken the step into the land of Skyweaver NFTs.

Instead, Skyweaver has chosen to take a more traditional free-to-play approach, allowing players to engage with the game for free and unlock all of the content over time. There is also no real competitive advantage to buying NFTs. The only gameplay impact it could have is that a player can pay to unlock cards faster than they would for free.

Card NFTs

Unlike many blockchain-enabled games, Skyweaver does not have any proprietary fungible tokens (at least yet). Instead, the game uses a stablecoin, Polygon’s USDC. The only blockchain components at this time are two types of NFTs: Silver Cards and Gold Cards, which play alongside the non-blockchain Base Cards.

Over the course of playing and leveling up, a player will unlock all of the cards in the game as Base Cards. Since they’re not on the blockchain, these cards are tied to the player account and can’t be traded, functioning like standard digital games.

Silver Cards are tradable and have no limits on mint quantities. There is no gameplay difference between Base and Silver (and Gold) cards; they are only identifiable by their silver borders. A player can obtain Silver Cards in three ways:

• Weekly Ranked Rewards — each week, top-ranked players on the leaderboards will win a set of Silver Cards.

• Purchase on the Market — players can spend USDC to buy cards from the Skyweaver Market.
• Wins in Conquest Mode — as described earlier, the Conquest Mode is a single-elimination, 8-person mini-tournament. In addition to XP, players win cards depending on their performances in the tournament.

Gold Cards are the real collectors’ items. They can only be obtained from Conquests and on the Marketplace. Unlike Silver Cards, Gold Cards only have a single mint period and then will never be minted again. Each week, 8 cards from the full set will be enabled for minting, and all Gold Card rewards will be minted from that set of 8. After that week those 8 cards will never appear in a mint again (although the team notes that alternative art versions could appear later).

While limited in supply, Gold Cards don’t provide any functionality over Silver or even Base Cards, so the only draw is collectibility. This can work in situations where there is enough social status or prestige associated with the game to create high demand. The current pricing of the Gold Cards supports this, with prices ranging from about 6 USDC up to a cap of 45 USDC.

It’s also worth mentioning that Skyweaver is regularly tweaking the balance of the cards, buffing and nerfing them to try to keep the game more balanced. This is common practice with collectible card games, and even those with NFTs like Splinterlands will make adjustments to cards. The practice is good for players, because it keeps the game fresh and tuned, but it can be nerve-wracking for investors and players who care deeply about the values of their cards.

Conquest, Silver Cards, and Entry Fees

There is one use for Silver Cards that doesn’t apply to Gold Cards, which is that they can be exchanged for entry into a Conquest. Because of the possible NFT rewards, Conquests do have an entry fee, which is either 1.5 USDC or a single Silver Card. This exchange rate is consistent with the fact that Silver Cards are seeded into the market by Horizon at a 1.5 USDC starting price. For context, Gold Cards are seeded at 10 USDC.

This system is the closest to a “play to earn” system in the game and is highly skill-based. With 8 players each spending either a Silver Card or 1.5 USDC to enter, there’s a total pot created of about 8 Silvers or 12 USDC.

The net result is that 17.5 USDC worth of prizes are given out compared to 12 USDC (8 Silvers) in entry fees. This is one place where Skyweaver falls into the trap of most play-to-earn games and gives out more than what is put in. If these rewards or entry fees can be adjusted so that they are net zero, then this would become a sustainable system. As it currently stands though, each Conquest effectively turns 3 Silvers into one much more valuable Gold.

The decision to use Conquests as the sole minting process for Gold Cards is an interesting one. While it should scale with the size of the audience, it also means that the card mints can inflate and easily end up primarily in the hands of a small number of active players. One has to wonder if it would provide more consistent results, not to mention great player incentives, to give them as rewards for Ranked placements instead. This would give a hard cap on each Gold Card mint volume as well as distribute the cards broadly among top-engagement players.

One benefit of this system is that it does help deflate the number of Silver Cards if they are the primary entry fee used. Additionally, the option to pay either 1.5 USDC or 1 Silver Card cleverly keeps the Silver Card floor at or above 1.5. If it falls below that, players are incentivized to immediately start buying them up since they would offer a cheaper alternative for an entry fee. The Market appears to bear this out, as the current floor price for Silver Cards is 1.51.

Niftyswap and The Skyweaver Market

Horizon has created Niftyswap, a decentralized protocol for trading ERC-1155 tokens in a liquidity-pool environment. ERC-1155 is a newer, more generalized token standard than ERC-20 (fungible) and ERC-721 (non-fungible). ERC-1155 allows for fungible, non-fungible, and semi-fungible (changing from fungible to non-fungible, like an egg hatching) tokens, as well as other features like batch transfers of non-fungible tokens and recovery of accidental transfers.

Niftyswap is heavily based on Uniswap but is designed for ERC-1155 tokens, while Uniswap is for ERC-20 assets. The Skyweaver Market runs on the Niftyswap protocol, and this gives it a number of unique characteristics compared to other blockchain game markets.

Niftyswap allows the Skyweaver Market to act more like a fungible liquidity pool than a set of person-to-person market order trades. A good comparison is shopping for cards on Splinterlands. One might want to buy a Level 1 Shadow Snitch. To do so, one would open up the listings and choose from the hundreds of sellers who have set their own prices on identical cards.

A buyer would typically choose the lowest, but this means that the sellers need to stay on top of their listings or else be priced out. Additionally, sellers don’t get paid until their specific card sells.

By contrast, the Skyweaver Marketplace provides a much clearer and simpler process for both buyers and sellers. Direct prices are listed for buying and selling, buyers don’t need to choose an individual seller, and sellers get paid immediately upon selling. Users can participate in the Market in two ways: as a liquidity provider or as a trader.

Niftyswap Liquidity Providers and Traders

Similar to most liquidity pools, a user can add a pair of tokens to the pool to increase liquidity and hopefully generate a return on investment. At the moment, this is done through the 3rd-party site skyweaverswap.com. An investor can provide a set of cards and the matching amount of USDC currency at the current card price. This increases the liquidity supply and sets the liquidity provider up to earn market fees.

There is a 1% liquidity fee added to all transactions that gets added to the liquidity pool’s currency reserve. This fee is then distributed back to liquidity providers when they burn their liquidity tokens and reclaim tokens and currency.

Most users, however, will interact with a Niftyswap implementation as traders, either buying or selling the token in exchange for currency. This process is straightforward, with clear prices listed and immediate exchange of tokens and currency.

Niftyswap Pricing

Buy and sell prices are automatically calculated by the Niftyswap protocol using a market maker mechanism. This method maintains a relationship between the available tokens and currency in the liquidity pool such that buying and selling doesn’t change their product. An example will illustrate the principle best.

Let’s say we start with the following values in the pool:

cards = 10

USDC = 100

Their product is $$10*100=1000$$, with each card equaling 10 USDC.

If User A wants to purchase a card, they will remove one card and add $$x$$ currency. The rule is that the product has to still be $$1000$$. So to figure out the cost we solve for $$x$$.

$$(10-1)*(100+x)=1000$$

$$x=\frac{1000}{9}-100=11.11$$

The result is that User A will need to add 11.11 USDC to the pool in order to remove a card, which is the purchase price. As you may notice, each purchase will get more and more expensive if no further cards are added, which one would expect from a supply-demand perspective.

If, on the other hand, User B wants to sell a card into the original $$10*100$$ pool, it would work in the other direction:

$$(10+1)*(100-x)=1000$$

$$x=100-\frac{1000}{11}=9.09$$

So the sell price into that original pool would be 9.09 USDC. These two prices are pretty far apart because the liquidity is quite low. If we did the same calculation but started with 1,000 cards and 10,000 USDC, we would get a buy price of 10.01 USDC and a sell price of 9.99 USDC. The system has much more stability if liquidity stays high, but it starts to vary wildly when liquidity is low.

A liquidity provider can add liquidity at any point but only at the same ratio as the existing pool (i.e. so that it doesn’t change the price). When a liquidity provider decides to remove its liquidity, it will likely receive a different number of cards and USDC than it originally put in, and the hope, of course, is that it turned into a profit.

Skyweaver Marketplace Fees

A transaction on the marketplace incurs a total of 7% in fees for the trader, as follows:

• 1% Liquidity Fee - This is the fee mentioned above that incentivizes liquidity providers.
• 5% Royalty Fee - This is a fee that Horizon has chosen to charge for Skyweaver, which is then enforced by the Niftyswap protocol and sent back to Horizon.
• 1% Front End Fee - An optional fee that a marketplace owner can charge with Niftyswap. On the official Skyweaver Marketplace it is 1%, though skyweaverswap.com chooses to set this to 0.5% for transactions processed through that website.

While 1% goes to the liquidity providers, the remaining 6% fee represents a revenue stream for Horizon. From a sustainable economy perspective, it is good to see that the game has a way of monetizing active players and interest in the game.

The Limited Crypto Scale of Skyweaver

Skyweaver, as it stands today, is a well-built game with a slick user experience, and as a free-to-play game it could do well. But is it succeeding at its goal of becoming a major blockchain game? The numbers so far indicate a good start but still “not yet.”

Fewer than 5,000 wallets have ever participated in the Skyweaver marketplace, and the average transaction size is around 34 USDC, for a total lifetime market trade volume of only 3.4M USDC. This volume puts it below Crypto Raiders but with a much larger audience. The game also neither showcases any high-profile purchases nor significant activity or value on OpenSea.

Play To Earn?

Skyweaver doesn’t advertise itself as a play-to-earn game, and that likely is a big part of why there isn’t a fervor over it. Everyone wants to get rich easily and quickly, and other projects are willing to “promise” such opportunities. Skyweaver takes a more slow-and-steady approach, but is very clearly in the “slow” state, still waiting to win the race.

It’s a little odd that Skyweaver doesn’t play up its Conquests mode more. These mini-tournaments are legitimately skill-based play-to-earn opportunities. The top players can turn their 1.5 USDC entry fee into 11.5 USDC worth of cards (1 Silver + 1 Gold) in the amount of time it takes to win three matches, likely less than an hour. While 10 USDC for an hour of top-notch play isn’t super compelling for an investor, it could potentially be interesting for farmers in low-income countries. A scholarship model does not work here though since all cards can be easily earned for free, as well as entry fees. That said, high-roller Conquests could start to draw larger attention if Horizon implemented them.

This is an area where Skyweaver could learn from ZED RUN, a game where high-entry zero-sum horse races have built substantial interest and growth in the project. ZED RUN also has sponsored races and big prizes that they fund to continue building community excitement, all of which could absolutely be applied to Skyweaver.

For example, rather than the 1.5 USDC / 1 Silver Card entry, consider what a theoretical 10 USDC Conquest could look like:

The second place winner would turn a decent profit, and the first place winner would score a solid wage, all while staying within a zero-sum balance. Things would get even more compelling by adding a 16-person Conquest.

Skyweaver could also take a page from Crypto Raiders, which runs nightly tournaments. A once-a-day 64 person tournament with a Gold Card (or even multi-Gold Card on weekends?) entry fee would create some real excitement and earnings for the players who make it to the Four Final™ slots.

Another tactic ZED RUN takes is to use fees from breeding to help prop up play-to-earn funds for tournaments. Horizon could potentially divert a portion of its Niftyswap royalties to a tournament fund to provide more opportunities for players to win prizes.

Liquidity Woes

Despite the cleverness of Niftyswap, Skyweaver is unfortunately struggling on the liquidity side. Niftyswap works well with high liquidity, but as seen with the earlier calculations, the prices can vary substantially and become unfavorable to both buyers and sellers if the liquidity is low.

While Horizon likely has a good reason to not have liquidity deposits natively built into Skyweaver (perhaps to maintain regulatory compliance?), this likely significantly reduces the liquidity potential from contributors, as does the fact that there are not clear benefits laid out for staking liquidity. About 3,500 unique wallets have contributed to the liquidity pool since the Closed Beta began in November 2021, with an average net contribution of about $300 per wallet.

Skyweaver has the additional complicating factor that they have over 500 different Silver Cards, each of which needs its own liquidity pool. Horizon originally seeded each pool with 40 copies of Silver Cards and 60 USDC (Gold Cards at 25 copies and 250 USDC), but this is hardly enough to provide any real price stability. With a current total market liquidity of about 97k USDC, that’s only about 200 USDC on average per card.

For comparison, Crypto Raiders has almost the exact same number of wallets staking (3,500), but it has built up a liquidity pool on its $RAIDER currency of over $20M USD.

This all results in destabilizing Skyweaver’s NFT market. Because of low liquidity, the price per card substantially shifts every time a transaction is made. This creates high levels of uncertainty and effectively prevents more than a few buys or sells in a row.

This is a place where Horizon would should be advised to pump the liquidity market manually with at least 1M+ USDC. The team can look into removing it at a later date if liquidity grows, but the market isn’t going to hold without having a stronger initial seed to attract additional liquidity providers and establish more favorable prices for buyers and sellers. Additionally, seeing the parent company only put in a small amount of its own funds into the liquidity pool (the initial seed from Horizon for 500 Silver Cards and 100 Gold Cards would have been around 50k USDC, a tiny amount by any NFT standards) does not instill confidence in potential investors.

Horizon also needs to find a way to raise awareness of and interest in the liquidity pool to liquidity providers. An infusion of funds can get things started, but external investors need to be involved if the market is to stabilize and grow. This should probably be a significant priority for Horizon in 2022.

The Sequence Wallet

As mentioned earlier, one of the most striking aspects of the Skyweaver onboarding is the ease of creating an account, especially compared to most blockchain games. The primary reason for this is Horizon’s own Sequence Wallet.

As much as Skyweaver is an impressive accomplishment for the Horizon team, one has to wonder if it is perhaps primarily a showcase for the Sequence Wallet. While Skyweaver is a solid game, blockchain gaming needs a major innovation in accessibility in order to have a chance of going mainstream, and the Sequence Wallet is definitely a step in the right direction. The wallet is a lot more user-friendly due to a few noteworthy features:

• Third-party authentication allows easy creation and management of the wallet, and even account recovery, as well as removing seed phrases.
• Gas fees can be paid in any supported token, reducing headaches of starting on a new chain and needing to get native currency.

The wallet boasts a number of other convenience features, but the above ones are what could help the wallet really open up crypto and web3 to a much wider audience.

The wallet is certainly not perfect yet. It only works with Ethereum and Polygon so far, so the utility is a lot more limited than a general wallet like Metamask. This also means users can run into issues if they try to transfer any other chain’s assets to the wallet. Such funds will be inaccessible until/unless Horizon adds support for that chain, which could effectively lead to losing funds entirely. And users can still end up with random scam tokens being deposited into the account. There are also some odd experiences, like the image below asking the user to sign for a transaction with the vague name “Me”.

In other words, Sequence generally still needs a fairly tech-savvy background to use safely and confidently. It does bring the bar down a bit, especially for the simplest use cases of easily creating and holding a wallet, but there is still a long way to go before it could be something like the PayPal of crypto.

The Future

Horizon has provided a 2022 roadmap that lists the features the team intends to add. The plan includes a good mix of new NFTs, new game content, new social features, game polish, and developer tools.

New NFTs

While Skyweaver currently only has two NFT types, Horizon has announced the addition of 3 additional ones in 2022: Stickers (for in-battle communication), Hero Skins, and Card Backs. The description for Hero Skins mentions releasing “more common (less flashy)” Hero Skins later, which suggests that rarity will be incorporated into at least that NFT type. These NFT types make sense given Horizon’s insistence on NFTs not giving players any advantages.

Content, Social Features, and Polish

Horizon has announced two “large” expansions for 2022, each encompassing roughly 50 new cards. They have also suggested that they will release a few “mini” expansions during the year, each with 15 - 20 new cards. In other words, players can look forward to roughly 150 new cards this year.

They are also adding a “Puzzles” section to the game. The team has been releasing occasional Puzzle challenges in their blog posts for a while, but these are now going to be an official feature. This should prove interesting for both new and experienced players, and Horizon is intending to allow players to create their own puzzles, adding a UGC element that could be rather compelling.

The biggest social feature announced is the addition of Guilds. This could potentially be a huge boon to the game depending on how it is implemented and what adoption looks like. In free-to-play games, guilds can provide a substantial improvement to retention, engagement, and monetization, so keep an eye on how this feature develops.

The game is also going to receive a lot of quality of life and polish features, including more animations, extended music and sound, improved game performance, and a faster wallet login experience.

External APIs

Horizon recognizes the value of enabling external developers to build tools and experiences for Skyweaver and so they are expanding the available APIs. While external markets are already feasible through interfacing with the Niftyswap implementation, new APIs will open up opportunities for players to collect and compile gameplay stats and build and run their own tournaments.

Building NFT Value

The game is focused on being a strong free-to-play game first, and that is likely a wise strategy. However, one of the advantages Skyweaver has over free-to-play collectible card games like Hearthstone, Magic the Gathering: Arena, and GWENT is the incorporation of NFTs. Without leaning into this advantage, Skyweaver is going to have to compete head-to-head with these giants and has little chance of success.

One of the very notable differences of Skyweaver compared to most blockchain games is the low prices commanded by their NFTs; even the most expensive cards are listed for under 50 USDC. To take advantage of the full NFT opportunity, Horizon likely needs to try building some appeal to investors and play-to-earn audiences, if only for the buzz and user-acquisition effects. In order to do this, Horizon needs to find ways to increase the market value of (at least some of) the game’s NFTs.

To that end they announced that Gold Cards are getting a substantial visual overhaul, moving from just having a gold border to a shiny, reflective foil look that is more typical of rarer cards in both digital and physical collectible card games.

Of course, increased aesthetics can only go so far. Horizon has taken a clear stance that its NFTs will not give players any competitive advantage. While this might limit the interest of investors — and will likely lead to a relatively low cap to NFT prices — it’s a decision that will appeal especially to PC free-to-play gamers who are traditionally rather derisive of “pay-to-win.” Many of the top PC free-to-play games (Fortnite, League of Legends, DotA 2, Apex Legends, Path of Exile, etc.) have little if any pay-to-win elements, so this is certainly a valid position to take on the platform.

That said, Horizon could try to find a balance that both appeases the competitive gamers and provides extra value to investors / earners. For example, one option would be for certain paid tournaments to require full Silver or full Gold decks. This, combined with rotating limits on Heroes or Prisms (“this weekend’s tournament is limited to Agility heroes”), would require serious play-to-earn users to build out a significant set of NFT cards. This would be even more effective if the concept of rarity was added to cards.

Horizon could look for other opportunities to give NFT-holders a more premium experience. Perhaps Gold Cards could act as a pseudo governance token, enabling holders to vote on new card art or game features. Or Silver Cards are burned to enable players to generate content in the planned user-generated puzzle feature.

None of this would affect the standard Ranked mode; free and non-NFT players could still compete on even footing and determine who is the most skilled player. But it would serve to build up the utility behind the NFT portion of the game’s economy, which if successful would benefit both free and NFT players.

It’ll also be interesting to see if the planned Tournament API would enable external developers to create paid-entry tournaments for players.

Projected Impact of 2022 Roadmap

We see Skyweaver’s top weaknesses in 2022 as low NFT value and anemic card liquidity pools, along with an audience that is not yet large enough to support the ambitions of the project.

If Horizon is hoping to increase the market value of its NFT collections, adding new NFT types is unlikely to have a significant impact while interest in the game and market is still limited. Doing so at a time when the NFT prices are low could actually backfire, reinforcing the perception that the game cannot produce high-value NFTs. Horizon may be okay with this outcome, but if not they may want to reconsider the strategy here.

Instead, we would prefer to see the team focus on increasing the value of the existing NFTs through building a sustainable play-to-earn model, juicing the liquidity pools themselves, and building a stronger case for investors / earners to participate.

The content, social features, and polish plans are in a “table stakes” category; they are needed to help the game be competitive with its peers. They also serve to keep current players engaged, seeing the game grow and evolve. These types of improvements also tend to be good for team morale. Developer APIs are likely relatively low effort and help set the stage for third-party growth over time, so they make sense to continue to flesh out as well.

Conclusion

Horizon’s Skyweaver is an ambitious project that is taking a relatively unusual approach in the realm of blockchain games. Rather than focusing on building up hype and FOMO, Horizon has instead focused on building a solid game. This restraint will likely help them build an audience of more traditional “gamers,” but it also limits the advantage of having NFTs in the game in the first place.

The revenue model in Skyweaver is simple and sustainable — a 5% fee is added to all card transactions and paid as a royalty to Horizon Games. The problem so far, though, is that the volume of transactions is very low, as is the size of each transaction. To wit, the total volume on Niftyswap (Horizon’s market-management protocol) to date is 3.4M USDC. Horizon’s 5% fee would be a slim 170k USDC.

Horizon’s approach is refreshing and has potential to put them ahead of their blockchain game competition. But they may have over-corrected in the process and will likely want to incorporate some lessons from other successful crypto game projects to elevate Skyweaver to the clouds.

Big thanks to Anthony Pecorella for writing this deconstruction!