The following is an objective review of BitGuild ICO. The review is based on certain criteria, which we think are important for an ICO project to succeed. We measure a successful ICO by short term and long term ROI estimation.
The following is not a financial advice.
BitGuild is a decentralized gaming platform built on the Ethereum blockchain. The project aims to revolutionize the current centralized gaming industry by creating a decentralized, global and unified gaming environment, where players own their in-game assets, and all in-game digital assets are tokenized and tradeable. BitGuild further aspires to redefine the relationship between developers and players, by creating an international platform that fosters both player-to-player and player-to-developer interactions. The driver of this platform will be the Platinum (PLAT). An ERC20 token will be used for trading all in-games digital assets on the BitGuild platform.
The project is developed and managed by BitGuild Foundation which is registered in Singapore. The team and advisors behind the project are highly accomplished and well-experienced leaders in both the cryptocurrency and the gaming industry. The founder & CEO of the project, Jared Psigoda, was previously the Co-Founder and CEO of Reality Squared Games (R2Games) an international developer and publisher of browser and mobile free-to-play games with over 80 million registered players from over 150+ countries. BitGuild has already established partnerships with TRON, and with three gaming companies that are currently developing blockchain games for the platform. The project’s early contributors include Patrick Dai (Founder of Qtum), Andy Tian (CEO of Asia Innovations Group and Gifto), Brock Pierce (Founder of Blockchain Capital), Justin Sun (Founder of TRON), and more.
Let’s get going with our evaluation!
The Gaming Industry And Its Current Drawbacks
The gaming industry has experienced sustained growth since it’s early days. While in the early 90’s, the gaming market value was estimated at around $100M with several million players, today’s gaming industry market is already valued at around $116Bn with over 2.3 billion players worldwide. In accordance with the industry growth, the power balance has changed. the mobile gaming industry is rapidly rising and is gradually dominating the market. According to NewZoo’s global games market report, by 2020, mobile games will capture 51% percent of the total market.
As a result of the growth of the mobile games industry, the demand for companies to meet, and exceed financial expectations, has increased. In that sector, gaming companies are being judged solely on their revenues and profitability and not only by VCs and investors but also by third-parties, such as Apple, Google etc. The “Top-Grossing Board”, where games receive higher traffic, is only based on the games’ revenues. Hence, gaming companies began to dedicate the majority of their resources to developing features intended to do nothing but increase revenues. As a result, game companies began to impose insane platform fees, asymmetric terms of service agreements, and more. These are the problems that BitGuild seeks to address. Let’s turn to review these drawbacks:
True Ownership of In-Game Characters and Assets
The problem: Prior to the advent of the blockchain technology, players didn’t have “True Ownership” of their in-game digital assets. Instead, all these digital assets were stored on the game company’s server, where the company had complete control. In many games, there are legal agreements such as Terms of Service (ToS) and End User License Agreements (EULA) that a player must agree every time they log into the game. These legal agreements usually clearly state that players don’t own any of the assets they acquire within the game. Moreover, in many cases (for example in World of Warcraft), according to these agreements, the game company have the right to terminate any account for any reason at any time without warning.
Blockchain-based games allow for virtual assets to be stored in players’ digital wallets, where these assets cannot be moved without the player’s permission. The game server interacts with each player by “reading” his linked wallet and loading a visual depiction of his character and items. This concept is already proved: in April 2017, EverdreamSoft (EDS) introduced the Spells of Genesis. A mobile trading card game built on top of blockchain technology, where the blockchain cards can be exchanged and traded outside the game. In the following months, CryptoKitties was launched. A digital collectible asset that is 100% owned by the player and can be traded in exchange for cryptocurrencies or other CryptoKitties.
CooperativeCompetitive Global Gameplay
The problem - currently most online games are split into regions and servers. Today such separation drastically decreases the latent potential of meaningful social interaction in online games. In some games this division derives from network latencies, in many other games, the developers are indirectly forced to design that division. Game developers often must work with intermediaries such as Facebook or Tencent who in-turn work with more intermediaries (local networks and banks). Since different platforms are being used in different regions (Facebook in Europe and U.S., and Tencent in China), developers are indirectly forced to design their games differently for different regions in accordance with these platform’s policies. In addition, the developers’ local partners also have to comply with local laws. For example, games in China cannot show skeletons and blood. Therefore, in many games, players from different regions are unable to communicate and play with each other.
A global game requires integration of various payment channels such as credits card, online payment platform etc. this issue raises a few problems. Firstly, some of these payment methods are not open to foreign countries. Secondly, exchanges in non-native currencies may involve high transaction fees and long settlement times. Thirdly, it is hard to price online items when you need to consider the transaction fees and different billing terms.
Blockchain-based games: as we will discuss below, BitGuild’s intent was to design a unified global gaming platform on top of blockchain technology, where players from all over the world will be able to play and interact online and all in-game digital assets will be tokenized and tradeable.
In-Game Items Trading
The Problem - In recent years, more and more games restrict players’ ability to sell or trade in-game characters and items. Neither for real money nor for other in-game items. This trend is prevalent mainly among free-to-play games. Free-to-play games are games which require no initial purchase, but instead, virtual items within the game can be purchased with real money. Since in this model any item that is traded between players, is revenue that is not going into the developers’ pocket, the latter gradually imposed more and more restrictions. To address this issue, trade has been happening during the last decades on third-party websites, outside of the game ecosystem. The problem with that manner is in term of trust. These websites, in many cases set up specifically to defraud costumers by selling items without any intention to deliver them.
Blockchain-based games: By using smart contracts, players will be able to trade directly with each other within the game, where a third-party is not necessary.
The problem: games like HearthStone and Clash Royale generate billions of dollars a year based on millions of transactions that range in value from few pennies to 10$. Players are not cost-conscious when it comes to incredibly cheap items, even if these items add up in the course of time. The main disadvantage on that manner is the transactions fees. International bank wires and even international online payments are often subject to additional permanent fee regardless of the amount of the wire. Therefore, in microtransactions, thee fees might be higher than the transferred amount. To address this problem, in many games, players must recharge a minimum amount of real money, which in turn, converted to an in-game currency. After the money has been converted, it is then can be spent on microtransactions in the game.
Blockchain-based games: By utilizing blockchain technology, players might be able to perform microtransaction directly, instead of recharge minimum amount. However, it is subject to negotiation whether public permission less blockchains in their current structures are able to allow concurrently, low transaction fees and fast execution time, while engaging high-volume of transactions.Cross-Game Compatibility of Items and Currency
As discussed earlier, since in blockchain games, the virtual items are all held in the players’ digital wallets, technically, they can be loaded into different games. For example, if a developer created a new blockchain game called Crypto Pets, he could technically load a character’s assets from CryptoKitties inside of that game. Further usage of this feature, could be to import and export items from first generation game to their second-generation counterpart. For example, if one developed a client-based 3d version for the CryptoKitties, let’s say CryptoKitties 2, Kitties which created in the first version could be loaded into the new version and being modified with new 3D artistic. The above is possible even if those games created by different developers.
The problem: Consumer protections, are among the highest priorities of Credit card companies and online payments channel. If a consumer has any issues with purchases on his card, he is free to dispute the credit card companies and ask for a refund. Let’s assume You purchased a pizza at your local shop, and the clerk accidentally charged your credit card for 99.9$ instead of 9.99$. Visa or Mastercard’s anti-fraud team will quickly realize that a clear mistake was made and will refund the transaction. While such incident can be easily resolved in offline transactions, in online transactions, things are getting more complicated. If a consumer contacts the credit card company claiming that he didn’t get an in-game item he paid for, a refund will be issued. The game developers might be unable to prove that they did provide a specific item to specific character within the game. Even if the developer proves that he provides that item, players may simply claim that their child bought the in-game items using their credit card without permission. Players may easily get refunded for all in-game items, regardless of whether they faulty. Since the majority of the games are free-to-play games which their revenues based mainly on these purchases, massive refunds to thousands of players might put these game companies at risk of being shut down. Furthermore, developers have to spend time and money operating anti-fraud teams, in order to prevent fraudulent purchases with stolen credit cards.
Blockchain games: in blockchain games, the transactions are permanent, one-way, secure and transparent. Therefore, developers: (1) will easily be able to provide a proof that a player received a specific in-game item and (2) won’t have to spend time and money on anti-fraud detections (since the transactions are permanent and secure).
BitGuild – The Platform
To address these issues, BitGuild designed a global ecosystem for blockchain games that consist of six major parts:
the game platform designs to be home for both game which has been developed by BitGuild, and games which developed by a third-party. In order for a game to be listed on the platform, it must utilize blockchain and smart-contracts, accept PLAT as the only payment option and feature tokenized in-game items that are player-owned and tradeable.
Incentives for developers: To incentivize developers to launch their games on the BitGuild platform, BitGuild provide the following:
- Localize: BitGuild’s team has a wealth of experience in game localizations. The team is willing to assist developers to localize their games and will translate those games into 15+ languages.
- Marketing: developers will be able to use more effective marketing strategies. Instead of spending millions of dollars on Google ads, developers will be able to pay that money for the players as an incentive to play their games. Industry resources will become more effectively used.
- Funding problem: BitGuild allows gaming companies to raise funds through the use of smart contracts directly from the players, and thus, solves the traditional revenue-based funding issues (will be discussed in the Design House section).
- Crowdsourcing: BitGuild fosters a decentralized working environment for blockchain games services. Using crowdsourcing, developers may reduce their operational costs.
Incentive mechanism for users:
- Accounts: players will create accounts on the website which will be linked to their wallets. New accounts start at level 1, and users can gain experience point (EXP) based on the amount of PLAT they hold over time: assumes you own 10,000 PLATS which is stored in your wallet over a period of 7 days. At the end of the week, your balance drops to 9,000 PLATS, where it stays for the next 7 days, and so on. Let\'s walk through an example:
If the PLAT-EXP ratio is 1 PLAT=0.0001EXP per minute. Over the two weeks, you will gain:
Week one - 10,000 PLAT * (7(days) * 24 (hours) * (60 minutes) *0.0001) EXP = 10,080.
Week two - 9,000 PLAT * (7*24*60*0.0001) = 9,072.
In total: 19,151 EXP.
To incentivize users to gain EXP (hold PLATs), users who level-up their accounts will be able to receive platform and in-game rewards, titles, forum badges etc.
- Achievement – BitGuild platform will feature an achievement section, where players can gain achievements by completing platform or in-game tasks. Players who will complete achievement will be rewarded with non-transferable and non-tangible tokens.
Transactions fees: The revenues from transactions which occur on the BitGuild marketplace will go to the selling player aside from a Design House contributor split. The specific amount is yet to be publicized.
Games’ fees: all PLAT spent within a game on the BitGuild platform, will be split between the game’s developer, Design House contributors, and BitGuild. The portion allocated to BitGuild will not exceed 10% of each transaction.
BitGuild wallet will support PLAT, ETH, and other ERC20 tokens, and will display the PLAT balance and transactions history. The wallet will further support a visual display of the non-fungible tokens (the virtual in-game items). In other words, a player will have a clear visual display of all the in-game assets that he possessed from the games on BitGuild platform.
BitGuild Virtual Asset Exchange
Every virtual asset on the BitGuild platform will be tokenized and will be then tradeable in the BitGuild virtual asset exchange in exchange for PLATS. Along with the BitGuild wallet, BitGuild will provide users with a free and open marketplace where players can put items for sale, view existing offers for purchase and conduct trades.
BitGuild seeks to create the largest international community of blockchain gamers on the web. Hence, BitGuild will implement an international forum system for users, to facilitate international player-to-player and player-to-developer interactions.
The BitGuild Design House
As mentioned earlier, Game companies are being judged solely on their revenues and profitability, and therefore, dedicate the majority of their resources to developing features intended to only bring in money.
The Design House’s main objective is to help Developers to solve these funding problems. The Design House hope to create a transparent marketplace, where game companies will be able to interact directly with the players\' communities. Game companies will be able to submit detailed plans about their game: game introduction, storylines etc., and Players will be able to review these submitted plans and choose to contribute to their favorite projects using PLAT. Therefore, instead of looking for venture capitalists and investors financial exceptions, developers will be able to focus on the players\' communities and their interests.
The design house utilizes smart contracts to allow games that reach their goal, to securely transfer the development funds. The development funds will be released to the developers only when the latter hit certain development milestones (storyline complete, playable demo, etc.). If a game doesn’t reach its goal in a specified amount of time, all PLAT will be returned to the contributing players.
Furthermore, the BitGuild design house intent to allow crowdsource for a variety of game’s services. For example, a game company will be able to put out a request for an art design of virtual weapon and set up a smart contract to pay X PLATS for a freelance graphic artist who will design that weapon. This feature will foster a decentralized working environment for blockchain games.
(BitGuild) The Game
The first game launched on the BitGuild platform will be BitGuild: The Game. a game where players create unique individual avatars which can accumulate unique items through mining, crafting and fighting. A beta will be ready in Q2 of 2018.
Token Use - PLAT
PLAT is an ERC20 token that will be used for trading all in-games digital assets on the BitGuild platform. PLAT will be the only type of currency accepted in the BitGuild Virtual Asset Exchange.
BitGuild already raised 30K ETH, during the private and Pre-ICO rounds. The early contributors include Patrick Dai (Founder of Qtum), Andy Tian (CEO of Asia Innovations Group), Brock Pierce, Justin Sun (Founder of TRON) and more top crypto investors that are not be disclosed.
All PLAT tokens will be generated in a seed block and will be distributed as follows:
- Token sale (45%): will be composed of initial PLAT token sale, private round, and pre-ICO round. Tokens which sold during the private, and pre-ICO rounds will be discounted but subject to lockup restriction.
- BitGuild Foundation (25%): Foundation’s token will be locked up for 2 years, with 15 being available after the tokens sale and 15 being unlocked every 6 months.
- Contributors and advisors (10%): contributors and advisors may receive PLAT tokens in exchange for advisory work. Most of these tokens will be subject to lockup restriction.
- BitGuild Team and Founders (20%): token will be locked up for 2.5 years using the same mechanism used for the Foundation.
During the first phase, BitGuild will operate a web-only platform. A mobile platform is expected to be launched later this year. The initial games will be developed in HTML and therefore, will be playable cross-platform (on both, PC and mobile). In the next few months, 2-3 games are expected to be available on the platform, aside from BitGuild (the game).
- 2018 Q1: Token Sale; Initial Platform Development; BitGuild (the game) design complete.
- 2018 Q2: BitGuild.com official launch; BitGuild.com community functionality launch; BitGuild (the game) beta launch.
- 2018 Q3: BitGuild (the game) official launch; BitGuild wallet launch; BitGuild marketplace launch; BitGuild.com platform opens to 3rd party developers
- 2018 Q4: Min 5-6 blockchain games launched on platform; Platform and all games localized into 5+ languages; BitGuild Design House beta launch; Migration to next-generation blockchain
- 2019 Q1-Q2: 10-12 blockchain games launched on platform; Platform and all games localized into 15+ languages; BitGuild Design House official launch.
Core team consists of 12 full-time team members.
Jared Psigoda - CEO & Founder
Jared was the Co-Founder and CEO of Reality Squared Games (R2Games) an international developer and publisher of browser and mobile free-to-play games with over 80 million registered players. R2Games licensed, localized, and published games in over a dozen languages, and had players from over 150+ countries. Subsequently, he was the founder of Livestar, a development studio focused on building live streaming. Livestar utilized a gamified virtual items business model where viewers could send virtual gifts to streamers who would then receive virtual coins which could be exchanged for real money (Similar to Uplive by Asian Innovations Group, only in the western world). In 2014, he was recognized as the only non-Chinese member of the Forbes China “30 under 30.”
Curtis Chiu - COO
Curtis has gained extensive game industry experience while working as an executive producer and product manager in various top gaming companies in the US and Asia such as Kabam, Outspark, Sega, and Konami. He previously served as the COO of Livestar.
Mikhail Larionov - CTO
Mikhail is a well experienced full-stack product and engineering leader. He led the Messenger Platform engineering team at Facebook and previously worked at The Walt Disney Company as a product lead on Playdom games such as Gardens of Time.
Brock Pierce - Chairman, The Bitcoin Foundation; Co-founder, Blockchain Capital, Block.one.
Brock founded IGE and IMI, which were world leaders in digital currency trading for video games as well as ZAM, one of the world’s largest media properties for gamers. Brock currently serves as co-founder of Block.one, the company behind EOS (a top 10 crypto project by market cap). He is also the co-founder of Blockchain Capital, a well known Venture Capital dedicated to blockchain project.
Justin Sun – Justin is the Founder of TRON and Callme (PEIWO) APP. TRON is the world top 20 crypto network by market cap and a web 4.0 blockchain dapp platform. PEIWO is one of the largest voice live streaming apps in China. He was listed on the Forbes 30 under 30 list three times between 2015 and 2017. He previously served as the Chief Representative in Greater China for Ripple Labs.
Kevin Chou – Kevin is the Chairman & CEO of KSV eSports. Previously, Kevin was CEO and co-founder of Kabam, a leader in developing console-quality mobile games which was sold for nearly $1 billion recently. Kevin serves on the Board of Trustees at UC Berkeley.
All team members, advisors, and partners are listed on the BitGuild website.
The core team, as well as the advisory board are remarkable. It seems that no better team could be set up for this project. The core team has a wealth of experience in development, publish and operate video games in some of the biggest gaming companies in the US and Asia. The team further brings an essential experience in the areas of game localization and gamified virtual items. Along with the experience in the gaming industry, the project has a top crypto advisory board (Brock Pierce and Justin Sun) and very interesting contributors (Andy Tian, Brock Pierce, Patrick Dai and Justin Sun). these collaborations, increase the project credibility and potential to establish more significant partnerships in the crypto realm in the future.
Complete hub for blockchain game development and promotion
BitGuild aims to build their own blockchain games, but also to attract third party gaming companies to build their games and launch them via the BitGuild gaming platform. BitGuild is helping those projects with legal aspects, community attraction, development of the game and more. BitGuild created a win-win situation, were gaming developers flourish from launching their games on their platform, while BitGuild will enjoy their user base and revenue growth if the game succeeds.
BitGuild’s objectives are indeed ambitious. However, considering the team and advisors experiences, they seem reasonable. The team brings tangible experience in game localization and virtual items business along with familiarity with both the US and Asian industries. R2Games (which led by Jared), licensed, localized, and published games in over a dozen languages, and had over 80 million registered players from over 150+ countries. given their unique experience, we believe that creating a global unified gaming atmosphere is a feasible goal.
Fair ICO terms
BitGuild seeks to raise a total of 44 K ETH, while 30K ETH already committed. The private rounds can be considered as a major drawback, as the majority of the fund raised through these rounds are given with relatively high bonuses. However, BitGuild uses a lockup mechanism for BitGuild foundation’s, advisors’ and early contributor’s tokens for a period of two years (Vested evenly over time). In addition, Given the project vision and potential, their hard cap is reasonable. All in all, the ICO terms seems fair.
(1) early stage of the project: despite its ambitious vision, the project is still in its early stages. while BitGuild’s website and game will be launched in Q2 2018, the wallet, marketplace and Design House will be launched only around Q3/Q4 2018.
(2) BitGuild’s adoption and success depend on mass adoption of blockchain games,
an immature industry. the concept of blockchain games is fairly new. It may take time until Complex blockchain games will be launched and mass adoption will occur.
Team & Advisory board: Highly accomplished and well Experienced team and advisors (Brock Pierce, Justin Sun, Jared Psigoa, Kevin Chou). Score 9.5
Stage of the project: relatively early. BitGuild’s game and website will be launched in a few months. The Design House, wallet and market place will be launched during Q3-Q4 2018. Score 7
Project potential: Aiming to create a unified global gaming platform. Blockchain technology solves major drawbacks in the current gaming industry. Score 9.5
Community and Media: ~10,284 Telegram members, ~6,976 Twitter followers. Score 8
Token use: PLAT will be used for trading all in-games digital assets on the BitGuild platform, no other currency will be accepted. Score 9.5
ICO: Hard Cap – 44k ETH ~ 39 M USD, 30K ETH ~ 26.5 M USD raised in private sales (Bonus of during the private round 40% (Locked up, vested over 2 years) and 15% during the pre-ICO). Score 8.5
Whitepaper: Very detailed whitepaper. Clearly represent the need, the problem and the solution, as well as the financial circumstances of the project. However, there is not much information regarding the technical aspects of the project. Score 7.5
Backend and Technology: BitGuild platform, the game, the wallet, Virtual Asset Exchange and the Design House. Right use of Blockchain technology. Score 8.5
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