In 2021, the Play-to-Earn (P2E) project in the GameFi space has become one of the major growth drivers for the cryptocurrency market.In the new year, move-to-earn (M2E), a business model that is changing the perception of blockchain applications, is gaining popularity.
According to the World Health Organization, more than a quarter of adults (about 1.4 billion) are physically inactive.Experts believe that 5 million deaths a year could be avoided if people started exercising more.
The concept of M2E or FitnessFi allows you to gamify different types of physical activity.The idea itself is not new. Think of games like Pokemon Go and Wii Sports.However, the new generation of apps not only makes users sociable and entertaining, but also provides financial incentives.
One of the most prominent representatives of the M2E space is the STEPN project of Australian studio Find Satoshi Lab.ForkLog found out how the app works, what its pitfalls are, and whether daily exercise can improve your finances.
A little-known development team is behind STEPN, but among the project advisors is Adidas’ Vice President Scott Dunlap.The product has also been financed by Binance, Alameda Research, and other investors.
STEPN has a fairly high barrier to entry. Participation in the project requires the purchase of $1,200 or more of NFT.
You can make money using this app, but there are risks associated with the project’s token economy, excessive centralization, and the conflicting behavior of Find Satoshi Lab.
What is STEPN?
STEPN is a fitness app powered by Solana blockchain that allows you to earn SPL tokens by running and walking.The more the user moves, the more rewards he gets.
In the latest update, STEPN added support for the BNB chain network.This coincides with the launch of a collaborative series with Asics on the Binance platform.
Behind the app is Find Satoshi Lab, a young studio that only includes the digital wallet Solwallet in other projects.However, the latter was never released.At the same time, some of our team members have mobile development experience.
Co-founder Jerry Huang has over 10 years of experience in video games and marketing.He is also the co-founder of Falafel Games, a mobile app developer.
Another co-founder of Find Satoshi Lab, Yaun Rong, is the commercial ambassador for the Algorand project and the president of the Australian Blockchain Industry Association and the South Australian Blockchain Association.In 2018, he founded a consulting firm, Crypto SA.
Among the advisors at Find Satoshi Lab is Scott Dunlap, Head of Adidas Digital Wing – Runtastic, who frequently shares his achievements on STEPN.
Running through the spring Alps, AdiZero Pro2 goes on forever.
215.21 $GST w/20 Energy @Stepnofficial and tan lines.🤩 #spring STEPN #adidas adidasrunning trail running ötztal Alps pic.twitter.com/rX0ExtObfQ
— Scott Dunlap (@scott_dunlap) April 12, 2022
In April, the STEPN smart contract passed the audit by Verilog Intelligence.The latter identified, among other things, the codebase of the WOOFI decentralized exchange and several lesser-known projects.
💼 STEPN Thanks @Stepnofficial
Verilog team reviewed smart contract for Game-Fi/Social-Fi Web3 application STEPN.
Learn more about this audit case. https://t.co/5aYFQbgNlF pic.twitter.com/XeEK9CWcNp
— Verilog Audit (@verilog_audit) April 5, 2022
Verilog Intelligence found some non-critical issues related to the risk of centralization, but in general confirmed the reliability of the product.
STEPN is in development since August 2021, but the app is already monetizing.According to a report published by Find Satoshi Lab, the product generated more than 192,635 SOL (~$2681 million) in NFT market fees and royalties in Q1 2022.
The product was invested by Sequoia Capital India and Alameda Research, a venture capital subsidiary of Binance, and both tokens have risen in value over the past month.
According to the project team, the app’s daily active users reached 300,000 in April.
As promised at this week’s Discord AMA, these are the last 30 minutes of online users.We hit 300,000 DAU this week too.pic.twitter.com/I8Pg0Q2Qv1
— Steps | Public Beta Phase 3 (@Stepnofficial) 17 Apr 2022
Over 168,400 unique users have deposited SOL deposits to co-STEPN addresses.
Data: Sand dunes analysis as of April 21, 2022.
The token economy of learning
STEPN Token Economics is based on two assets: Stepn (GMT) and Green Satoshi Token (GST).The first is the governance token and the second is the project’s in-game currency.
GST benefits are unlimited.Users earn these tokens through app-related activities.
On April 20, the developer changed the technical documentation and issued 60 million tokens to provide a decentralized GST mining pool.
20 million GST from Solana network and 20 million GST based on BNB chain will be placed in liquidity pools Orca, Raydium and PancakeSwap.
10M GST (Solana) and 10M GST (BNB Chain) are locked on Binance Exchange for cross-chain bridge smart contracts.
GMT is mined on a pre-mined basis and the supply is limited to 6 billion coins.Users can also get these assets, but this opportunity is only available when the NFT reaches level 30.
In the M2E model, 30% of the issued tokens are allocated and the same amount of assets is tailored to the needs of the ecosystem and project funding.Over 16% of GMT is sold privately and another 7% is placed on the Binance Launchpad platform.The remaining tokens are blocked by developers and advisors.
The STEPN mechanism includes token destruction. Remove tokens from circulation by repairing and upgrading NFTs, opening mystery chests, forging sneakers, improving gems and unlocking slots.
one step is gold
To join STEPN, you must register and purchase NFT sneakers in the app.
To register, you must obtain an activation code.The latter is distributed daily in the official community of the project at 13:00 UTC (16:00 Kyiv/Moscow time).You can also share with existing STEPN users who have made some progress in the app.
The purchase of non-fungible tokens can be done through the in-game marketplace or through the Magic Eden and Binance NFT platforms.
The barrier to entry for the project is quite high. At the time of writing, the cheapest NFT available in the app is 11.59 SOL (~$1216).Magic Eden is more expensive. Start at 12 SOL.The cost of purchasing collaborative NFTs on the BNB chain network will be several times higher.
When creating an account on STEPN, it is worth considering that we are talking about applications with a fairly high degree of centralization.
After registering the wallet, a mnemonic phrase required for recovery is issued, and the public address is also reported.However, the private key is not disclosed to the user.
Wallet settings interface.Data: STEPN.
Depending on the level of load you need, you can choose one of four sneakers.
Walker (1-6 km/h) – 4 GST per unit of energy consumed by default;
Joggers (4-10 km/h) – 5 GST per unit of energy
Runners (8-20 km/h) – 6 GST per unit of energy
Trainer (1-20 km/h) – You get from 4 GST to 6.25 GST per unit of energy depending on the speed you choose.
NFT is also divided into 5 quality levels: Common, Uncommon, Rare, Epic and Legendary.Quality determines the minimum and maximum initial stats and the stat points the sneaker earns at each level.
The initial properties of an NFT depend on its quality.Data: STEPN.
The score for each level depends on the quality.Data: STEPN.
STEPN has four properties, each of which affects gameplay in some way.
Efficiency affects the amount of GST earned.The higher this metric, the more tokens users earn per unit of energy consumed.This attribute is one of the most important multipliers when calculating profitability.
Luck determines how often and how often mystery chests drop.
Comfort is currently deprecated.According to the project white paper, the indicator is “modified and in development”.
Elasticity determines the strength level of the NFT.Sneakers become less durable as the wearer moves and must be repaired for GST.High reliability reduces wear and associated costs.
The profitability of NFTs is penalized by heavy wear and tear. When Durability drops to 50%, Efficiency drops to 90%, and when Durability drops to 20%, Efficiency drops to 10%.
The latest update significantly increased the cost of upgrading sneakers on STEPN.To reach level 30, you need to spend 600 GST and 229 GMT (over $3,500 at current exchange rates).
Data: STEPN Official Community.
Can you make money on STEPN?
STEPN’s gameplay is very simple. While walking or running, the user activates the tracker and tries to maintain speed within the range indicated in the green area.For this, he receives GST tokens (or GMT level 30 if necessary).
A player’s actions are limited by energy.The base stat is 2, but you can increase it by purchasing additional NFTs or premium sneakers.
25% of your maximum energy is restored every 6 hours.
We bought the NFT and tested STEPN for a week.Walker-level shoes (normal mass) will bring you about 8 GST (about $37 at the time of writing) for every 2 units of energy expended on a 5 level climb.
For high-quality NFTs, this value is higher, but more expensive.
This is one of the test walks.Data: STEPN.
Theoretically, your initial investment of $1389 (11.42 SOL for sneakers + 20 GST for tops) can be returned within 50 days.Estimates take into account the cost of shoe repairs (approximately 1.6 GST – 1.8 GST per walk), but not changes in the GST rate. The token has been trading between $5.50 and $5.50 since the end of March. According to CoinGecko, it is $3.88.
Additionally, the growing popularity and growing popularity of the project allows the NFT itself to increase its price to extract additional revenue.
After accumulating a sufficient amount of cryptocurrency, you can buy another sneaker and launch a third one.This will increase your maximum energy supply, which will increase your revenue.Also, NFTs can be simply sold.
In the future, developers promise to add the ability to rent non-fungible tokens.This means that sneaker owners can earn passive income.
At first glance, investing in STEPN looks attractive. There is a potential opportunity to earn significant returns for your daily running or walking.However, before making an investment decision, it is good to know that the project has plenty of pitfalls.
It’s good to start with the fact that STEPN is in beta testing. This creates its own problems.
Sometimes the app reads the movement speed incorrectly and refuses to raise the token.The tracker will also give you a Moonwalking error if all necessary conditions are met or the user is unable to log in due to “network being used”.
Since the recent update, the community has been complaining about losing coins when transferring funds.The developer described this situation as a bug and the issue was fixed.However, there is no guarantee that this will not happen again.
As mentioned above, STEPN is a centralized application.Users cannot store their NFTs in a separate non-custodial wallet, so if a block or other event occurs, they may lose access to their funds.
Despite its simplicity, STEPN has a complex and opaque reward system.User revenue in GST is calculated using the following formula:
N is the energy consumption.
PSE and PSEC – Shoe Efficiency and User Efficiency Ratios, respectively (including Gems and other boosters)
X – average speed;
Y is the NFT sustainability indicator.
randbtween (Parameter1, Parameter2) – A function that selects a random value within the range set by the system.
System Value – A value set by the game developer.
In this formula, we need to pay attention to two variables: randbtween(Parameter1, Parameter2) and the system value.The first meaning is unknown and unspecified.According to the technical documentation, the second value can be changed by the developer.
This shows that the project team can have a significant impact on users’ earnings by adjusting system parameters behind the scenes, rather than through transparent measures like increasing the number of shares inside the token.
Previously, we wrote about the unstable token economy of P2E platforms.Successful projects are based on complex economic models that determine resource allocation.
Developers are always looking for a balance between immersive experiences and incentive systems that allow users to invest time and money in their products.
For blockchain games, one possible solution is to include more in-game stocks and “tokenized resources”.These systems allow project teams to function as currency regulators.
For P2E products, users are willing to spend money earned in the app ecosystem in the app ecosystem simply because they provide a fun gaming experience.However, this approach may not work for M2E projects.
STEPN’s only internal token inventory is the sneaker upgrade and repair system, as well as the fees charged for opening mystery boxes and other in-app transactions.
The team has announced a multiplayer-like appearance that resembles a leaderboard, and plans to hold various events from time to time.However, the token economy of the project is not sustainable and the above measures will not be sufficient to make it sustainable.
The practice of changing technical documentation during project testing also seems questionable.In fact, the developer increased the number of GST in circulation to 40 million tokens, demonstrating the need to provide liquidity.However, the original version of the document did not provide for such an action.
Therefore, a separate risk is the possibility of a decline in GST and GMT prices.At the time of writing, the coin is showing positive dynamics.Over the past month, the first has increased by 37% and the second by 293%.
But everything changes. Explore Axie Infinity.As of this writing, AXS prices are down more than 70% from their November 2021 highs.
as a result
According to Ethereum founder Vitalik Buterin, the main purpose of crypto is to “do something that has a meaningful impact on the real world”.
The M2E model conforms to this philosophy and conforms to the concept of Web 3.0.Programs like STEPN can be a revelation to those who lead a sedentary lifestyle and become hyperactive.
The financial incentives offered by M2E really work.People have been paying doctors for centuries, but now they’re actually getting paid to lead a healthy lifestyle.
I can confidently say that this sector will evolve along with the concept itself.We will definitely see projects that provide more interesting user experiences.
STEPN itself can be game-changing, but first, developers must build a sustainable economy.
If you have the extra money and want to participate in a sport you’ve been putting off for a long time, take a look at this product.However, the aforementioned experience with Axie Infinity clearly shows that users should not expect steady gains from their applications in the long run.
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Information source: Compiled by FORKLOG by 0x information. Copyright belongs to the author Василий Суслов. Reproduction is prohibited.