What is Game Token?

A game token is a fungible cryptocurrency (usually ERC-20) that serves as the native currency for a specific blockchain game or ecosystem. It is used to facilitate the game's internal economy and reward players for their achievements.

How does Game Token work?

Players earn game tokens by completing quests, winning battles, or achieving milestones.
These tokens are held in the player's cryptocurrency wallet, giving them true ownership.
Players can spend tokens on in-game assets, upgrades, or "battle passes."
Some tokens grant "governance" rights, allowing players to vote on game updates.
Unlike traditional "gold" in non-blockchain games, game tokens can be traded on external decentralized exchanges for other cryptocurrencies.

Why does Game Token matter?

Game tokens are the foundation of the "Play-to-Earn" (P2E) and "Play-and-Earn" models. They align the incentives of players and developers, as players become stakeholders in the game's success.

Key features of Game Token

Fungible and divisible (ERC-20 based)
Earnable through skill or time investment
Used for in-game utility and purchases
Tradeable on external open markets
Often includes inflationary or deflationary mechanics

Examples of Game Token

AXS and SLP are the two primary tokens used in Axie Infinity. Other notable examples include SAND (The Sandbox), MANA (Decentraland), and GALA (Gala Games), each serving as the primary medium of exchange in their respective virtual worlds.