Mechanism Capital Allocates $100M Fund for Play-to-Earn Games

Mechanism Capital Allocates $100M Fund for Play-to-Earn Games

Mechanism Capital is betting on play-to-earn games this 2022! Credit: Coin News

Mechanism Capital is ready to take on 2022 with the launch of its new $100 million fund for Play-to-Earn game titles. This move is a natural progression because the crypto investment company started expanding its portfolio last year. He invested in projects like Star Atlas, Ember Sword, Yield Guild Games, and more.

Founded in 2020, Mechanism Capital is a United States-based venture capital investment firm. Initially, the company focused on crypto ecosystems and decentralized finance sectors. The firm is acting on the growing popularity of the P2E gaming model, taking the gaming scene by storm.

About Mechanism Capital's P2E Investment Fund

Steve Cho, a former game business manager for Apple's App Store, has also partnered with the firm to lead the fund. Commenting on the move, he said: “NFTs and new gaming paradigms like play to win are exciting new ways to approach the way we make games. For the first time, players can own parts of the experience, invest not only time, but also earn money."

On its website, Mechanism Capital described NFTs and gambling as the "Financialization of Fun." As such, more game studios are exploring opportunities in blockchain, and "Play to Win (P2E)" is on the lips of every venture capitalist. The gaming skin market alone is currently estimated at $40 billion per year.

The company's move to double down on P2E gaming is very timely because early adopters are already reaping the rewards. For example, Animoca Brands completed a $358,888,888 capital raise with a $5 billion pre-money valuation to grow the open Metaverse. Over the course of 2021, the Hong Kong unicorn raised $216.28 million to bring its vision to life.

Additionally, major players like Forte, Enjin, Solana Ventures, among others, have opened dedicated funds to support projects in this space.

The charm of P2E games

The current leading blockchain game, Axie Infinity, achieved a $35 billion ($AXS) valuation last year thanks to the P2E gaming model. Players were rewarded for their in-game play with assets that they could sell for their real-world value. Aside from ownership, the tokens offer control of the games. Needless to say, it was different from existing game models, but in a good way. Illuvium, another game that won't be released for another two years, found itself at a valuation of $11 billion ($ILV).

However, the real appeal of playing to win is its ability to change lives. In the Philippines, which is home to 40% of the players, earnings from that game exceed the minimum wage. It sounds like a fairy tale, but people from all walks of life can make a living just by having fun playing video games.

So, all things considered, Mechanism Capital's move from not sleeping on playing to win ticks all the boxes!

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