As in-game economies grew, they generated robust black markets for virtual items, with players buying and selling everything from ordinary game elements (armor, weapons, gold) to the equivalent of collectibles (a limited-edition party hat).
Because players were accustomed to spending real money on virtual goods—or, in some cases, real money on digital currency, which could be spent on virtual goods—these black markets could be lucrative.
Real-money trading, or R.M.T., began with one-to-one exchanges on sites like eBay, but was quickly scaled up and professionalized.
Some players, usually in places with limited economic opportunity, took up gaming full-time in order to rack up in-game loot, treasure, and bonuses, selling those assets for profit, outside the game, to other players—a practice known as “gold-farming.”
In 2004, the president of Internet Gaming Entertainment—a virtual-asset-trading startup, established in 2001, that relied on the labor of low-wage players—estimated that the market for virtual goods and services was about eight hundred and eighty million dollars a year.
By 2009, as many as a million “farmers” worked in China, many of them in tightly packed, open-plan computer labs, under conditions that were often compared, in the media, to sweatshops.
In 2011, the Guardian reported that prisoners at a Chinese labor camp were being made to play online multiplayer games, “to build up credits that prison guards would then trade for real money.”
Reading about people who played games for profit reminded me of “Games of Empire: Global Capitalism and Video Games,” a seminal work in video-games studies published in 2009, by Nick Dyer-Witheford and Greig de Peuter, academics working in media studies.
The authors, argue that video games are the “paradigmatic media of Empire”—a totalizing regime of “planetary, militarized hypercapitalism.”
Massively multiplayer online role-playing games fell out of fashion in the early twenty-tens, eBay banned the sale of virtual goods, pushing it to smaller, more ephemeral Web sites and marketplaces.
Game developers, sometimes under regulatory pressure, tried to crack down on off-platform sales, which were almost always against their end-user license agreements and terms of service anyway.
But in recent years, real-money trading has seen a minor resurgence. Old School RuneScape and Tibia, online multiplayer games set in fantasy worlds, have attracted players from Venezuela, who have found that their in-game currencies are more valuable and stable than the bolívar.
(The games are popular in part because of their retro graphics, which can run well on older computers with slow internet connections.)
In 2019, when Venezuela was hit with widespread power outages, there was an immediate economic crisis in Old School RuneScape.
Above-board video-game marketplaces, meanwhile, have become more abundant and varied.
These days, people spend more than eighty billion dollars a year on virtual goods sold in video games.
Game-studies scholars have long argued that gaming allows players to experiment with new identities and modes of being:
“Virtual games simulate identities as citizen-soldiers, free-agent workers, cyborg adventurers, and corporate criminals,” Dyer-Witheford and de Peuter write.
“Virtual play trains flexible personalities for flexible jobs, shapes subjects for militarized markets, and makes becoming a neoliberal subject fun.”
Virtual worlds, it seems, also train players to be eager, expectant, and constant consumers.
Games reflect their creators’ societies and circumstances. FarmVille, in which players obsessively managed capricious fiefdoms, was launched in 2009, and has had two sequels.
In 2011, FarmVille players spent an estimated hundred million dollars on virtual goods; the writer Cory Doctorow later characterized it as “an unregulated, low-yield casino game.”
In retrospect, the game looks like an artifact of Silicon Valley’s post-recession startup scene, which flourished during a transitional, confusing time when smartphones weren’t yet ubiquitous and uneasy borders still held between online and offline life.
The game was played on Facebook, and revolved around virtual crops that died without constant attention.
It relied on the defining features of its technological moment—social-media networks, data collection, reëngagement hacks, user-generated content, and native advertising.
FarmVille’s success, the artist and designer A.J. Patrick Liszkiewicz has written, depended on its adoption of social-media logic—it entangled users “in a web of social obligations.”
The metaverse, if it takes off, will reflect its cultural and technological moment, too. Taking cues from today’s tech ecosystem, it will probably be privatized, centralized, and financialized, with rampant artificial scarcity.
Players of FarmVille were not digital natives; players of games like Fortnite and Minecraft almost certainly are, and, in the metaverse, will be the target audience for companies selling digital skins, virtual trinkets, and cloud-based space.
Some vocal proponents of “web3”—an as-yet unrealized idea for the Internet’s next phase, based on visions for a decentralized, blockchain-based digital substrate—have fixed their gaze on the metaverse, seeing it as an opportunity for epochal transformation.
(Arguments in favor of web3 are frequently made using utopian rhetoric—democratization, decentralization, transformation, freedom, revolution, and so on—that elevates, or obscures, what would otherwise be a financial conversation.)
We don’t yet know if cryptocurrency and the blockchain will have anything to do with what Microsoft, Meta, Roblox, or Tencent are building (although the torrent of venture capital flowing into cryptocurrency-related companies is notable).
But the future importance of money in the metaverse seems indisputable. Meta-life will probably involve a reimagination of financial life and, possibly, a shift in our existing social hierarchies and institutions.
“Many of today’s dominant visions for the future of money are unlinked from the political and territorial structures of nationhood,” the media scholar Lana Swartz writes, in her book “New Money: How Payment Became Social Media,” published in 2020.
“All of these visions are, on some level, postdemocracy fantasies.”
A new crop of video games, categorized as “play-to-earn,” might give us a sense of where the metaverse is headed.
Players of such games are often rewarded with native cryptocurrency—that is, with the game’s version of Bitcoin or Ethereum.
Unlike FarmVille’s Farm Bucks or RuneScape’s gold pieces, which were in-game only, these new cryptocurrencies can be traded, off-platform, for other cryptocurrencies or government-issued money.
Currently, the most prominent play-to-earn game is Axie Infinity, which is frequently compared to the game Pokémon.
Characters in Axie Infinity, called Axies, are N.F.T.s, or “non-fungible tokens,” which serve as certificates of ownership for stoned-looking cartoon axolotls.
By winning battles with their Axies, or selling them to others, players rack up tokens of Smooth Love Potion (S.L.P.), and “governance” tokens called Axie Infinity Shards (A.X.S.); today, on cryptocurrency exchanges, a single S.L.P. token is valued at about three cents, and an A.X.S. token is worth about ninety-three dollars.
During the pandemic, people in the Philippines have taken to playing Axie Infinity professionally, finding it more lucrative than local employment.
“We believe in a future where work and play become one,” the game’s F.A.Q. states. “We believe in empowering our players and giving them economic opportunities.”
Recently, on a podcast produced by the venture-capital firm Andreessen Horowitz, Jeff Zirlin, a co-founder of Sky Mavis, the Vietnamese gaming company that makes Axie Infinity, used the same extravagant rhetoric to describe the game’s appeal.
“What we’ve built is not just the gaming community,” he said. “It is, in many ways, a nation where people have shared cultural values.”
In this nation, it seemed, any distinctions between culture and finance had collapsed.
Some critics note a sense in which Axie Infinity’s revenue model is like a ponzi scheme: to start, players are required to purchase three Axie N.F.T.s, which can cost anywhere from a hundred to a thousand dollars, and this props up the value of current players’ Axies.
If new players stop signing up, the internal economy may sputter and crash.
Even so, any cash flow problems might be mitigated, for a time, by venture funding: Sky Mavis recently raised more than a hundred and fifty million dollars in venture capital, at a three-billion-dollar valuation; the funding round was led by Andreessen Horowitz, which was an early investor in Zynga, the creator of FarmVille.
Even when the game changes, certain strategies—and players—stay the same. (“Gaming is going to be a key way in which the next hundreds of millions of users onboard into crypto,” Arianna Simpson, an Andreessen Horowitz partner, noted, on the podcast.)
Listening, I wondered, Could I make this my life? Banking dashboards, cryptocurrency wallets, ledgers and spreadsheets.
I tried to imagine myself in a corporate-owned and venture-funded metaverse: a virtual axolotl in a virtual sweater, writing for a virtual magazine in a virtual office, hemorrhaging virtual money.
I might covet the Gen Z copy-editor’s avatar, and hope that readers would invest in N.F.T.s of my work. I could be paid in CondéCoin, with a cut going to Meta or Minecraft or Microsoft, whatever corporation or game was my virtual landlord.
Weekends would be spent at the arcade, or the casino. My husband and I would go on virtual vacations to virtual worlds, stay with virtual hosts who played virtual games set on virtual farms. I could play to earn—and earn, and earn. I could have everything I wanted, and nothing at all.