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What Club Penguin Can Teach Us about the Future of Play-To-Earn Gaming

In the early 2000s, you could find a lot of young kids at the club—Club Penguin, that is. 

The game was a hit among young millennials, who would stay up late pointing and clicking until their fingers got sore so they could upgrade their igloos. And though Club Penguin officially shut down in 2020, and many of those millennials now likely have early onset carpal tunnel, there are parallels to be drawn from these formative games as web3 games come to fruition. 

Play-to-earn and the pressure for status in gaming

Since its inception, play-to-earn-style gaming has quickly become an integral part of the blockchain gaming experience. While the category is relatively new and derived from systems of the past, it’s already ubiquitous on virtual world platforms, rapidly evolving, and shaping what the future of gaming will become.

The term, “play-to-earn” (P2E) was widely popularized through the explosion of Axie Infinity after it launched in 2018. In the Web3 game, players battle each other or automated teams head-to-head using small creatures called Axies. While the fights echo older formats like those seen in Pokémon, users are able to win real money in Axie Infinity, either from battles or through completing tasks in Adventure Mode. In terms of P2E models, this could be just the beginning. 

Skilled users may eventually profit off their abilities from others looking to fast-track their in-game rewards by paying them to play or accomplish tasks. Naturally, one would wonder: who would want to pay to have someone else play for them? Isn’t progressing through a game supposed to be the fun part? While gaming offers an escape from reality, it is not always an escape from the grind of mundane or menial tasks. Combine that with the existing market of status-chasing players looking to flex and you have a perfect ecosystem for outsourcing in-game work.  

Why living virtually is important 

Living virtually is becoming increasingly as important as existing in the physical world. Investing a significant chunk of time into digital life is no longer a niche practice reserved for tech lovers who are terminally glued to their devices. Today, it’s estimated that 66% of Americans play video games regularly. As the physical and virtual worlds increasingly overlap and inform each other, it’s natural that social hierarchies will form based on in-game dynamics.

This new social network in the gaming world places more pressure on users to acquire status (generally from obtaining high-level rewards) as quickly as possible. While many items can simply be purchased, there are still exclusive rewards that can strictly be achieved through putting in time and effort and earning them. With so much value placed on status that players must work towards, it’s easy for even gaming to become “a grind.” Developers often exaggerate the number of repetitive tasks required to unlock rewards by design in order to keep users engaged and feeling productive once they overcome challenges. 

Competitive players of popular games like Call of Duty resort to practicing with third-party training software to sharpen their aim, improve their performance, and power through levels faster.  Battle pass progressions in games like Fortnite and Apex Legends introduce time-locked rewards through the completion of quests designed to lessen the feeling of repetition through differentiated actions. Although gaming is generally considered a recreational activity meant for relaxation, when observing these behaviors and game characteristics from an external perspective, they appear to be more akin to work than play. 


Early Virtual Worlds and the Joy of Hard Work

At Everyrealm, we are constantly evaluating the development and usage of virtual games. Many platforms we see today seek to emulate the same qualities of those we spent a fair amount of our childhoods playing. Worlds like Neopets, Club Penguin and Webkinz all boasted robust economies, millions of users and very active player communities. These were the early social networks where we aspired to have influence and status. Even then, having status meant acquiring the coolest clothes, pets and items that these realms offered. At that time, there weren’t options to purchase anything without earning in-game currency first. 

On Club Penguin, players spent hundreds of hours optimizing processes and playing the same games so they could earn enough to buy the next item for their virtual character. Regardless of what players acquired, they always wanted more. Looking back on those efforts today, it was the perceived productivity rather than making purchases that gave the community the satisfaction they craved. There was an option to buy in-game coins with real money but that would have taken the fun out of the experience. Every time players earned enough coins to get something new, they were climbing the hypothetical ladder of the platform, gaining Club Penguin street cred! 

Under the guise of personalization, early virtual worlds were teaching players the joys of reaping the rightful spoils of hard work. Tedious work. Clicking and tapping over and over again meticulously, perfectly, just to maximize the output each time. Today, microtransactions and item shops rule the landscape of uniqueness in games and virtual spaces alike. Want to have the coolest new skin? If you don’t see it in the battle pass, it’s likely you’ll have to pay real money for it. 

How productivity gets rewarded in video games

It’s not a recent phenomenon that people pay to be productive in games, but the launch of Fortnite’s Battle Pass made it mainstream. The Battle Pass system is designed to reward users with various items for time spent playing a game for a small fee. Upon reaching the maximum level, the current Battle Pass in Fortnite (costing 950 V-Bucks, or $9.50) rewards a user with 8 skins, 1,500 V-Bucks and numerous other cosmetic items like pickaxes, backblings and emotes. Fortnite skins that achieve “legendary” status within the broader community see rare appearances in the item shop, but certain others are reserved for the players that max out the Battle Pass. Skins like “The Black Knight” and “Reaper” are so difficult to achieve in the Battle Pass that there was an inside joke in the community to run away from players wearing them.   

As social networking and gaming continue to converge, we’ll see more examples of cultural phenomena like this—in virtual worlds. The fear of missing out on in-game culture and status will normalize users paying skilled players to help level up their characters and receive rewards that elevate them. 

As we continue to see the rise of the virtual worlds that combine incredible gaming experiences with a masterful spin on social connection, we can’t help but think that the most successful ones will have a merit-based element to them that unlocks majorly sought after cosmetic content. 

Animal Crossing: New Horizons was adored by many as a playful escape during the pandemic, but examining its progression system unveils a labor-intensive undertaking similar to other games discussed above. Some players (those striving for a five-star island rating or those lacking creative design talent) took to the internet to search for paid help with terraforming their homes or unlocking content. 

Paying others to grind out gritty in-game work is an unfortunate but unavoidable future as virtual worlds become the internet hangouts of the next generation. This has occurred before in competitive FPS games and MMOs, and we believe it will spread to the broader gaming landscape as this mass cultural shift towards digital identity and virtual socialization continues to take shape.