STEPN and the Move-to-Earn model
We are excited to announce that recently, Ocular, the new Web3 focused investment fund managed by Openspace made an investment into STEPN, a move-to-earn NFT game built on Solana. Our investment was part of a $5 million seed round that counts Sequoia Capital, Folius Ventures, Solana Capital, Alameda Research and DeFi Alliance amongst those who participated. The official announcement can be found here.
Since then, STEPN has reached a significant milestone in their rapid progress, with the official completion, on March 9th, of its Initial Exchange Offering (IEO) and listing on Binance as part of the Binance Launchpad program. We were encouraged to see that STEPN’s listing on Binance was extremely successful - with over $3.6 billion worth of $BNB staked to gain access to $4.2 million worth of STEPN’s governance tokens ($GMT). The strong price performance marks an energizing time for all of us at Ocular.
Capturing the possibilities of move-to-earn
Over the past twelve months, we have witnessed the meteoric rise of play-to-earn games such as Axie Infinity, which promotes a new framework that taps on blockchain technology (in the form of NFTs and DeFi) to allow gamers to truly own and trade their digital assets for financial returns.
Play-to-earn games are also gaining popularity with global gamers, who make up an estimated 2.5 million plus players in the blockchain-based gaming space. Experts predict that we could see 100 million players in the sector in the next few years alone.
The market cap for all play-to-earn tokens has been growing as a result, and as of February 2022, it passed $17 billion.The daily trading volume for gaming NFTs reached its peak of around $500 million in Nov 2021, up from $5 million a few months back in July 2021. That represents a 9,900% increase.
A subset of the play-to-earn concept is move-to-earn, where part of the gameplay revolves around the physical steps that gamers take in real life, where rewards are gained through engaging in walking or running. The soft signals of the effectiveness of this concept was evident with the Pokémon Go craze in 2016. This geolocated AR title tasked players to move around various neighborhoods and capture their favorite Pokémons, before engaging in battles with other players. Since launch, Pokémon Go has surpassed $5 billion in total player revenue and still boasts over 80 million active players.
At Ocular, we believe that move-to-earn games will become increasingly popular for players, as it seamlessly integrates into their lives and promotes an active lifestyle. Just imagine that for every step they take outside, STEPN will be clocking them. Each one equals progress in the game. There is also a compelling social angle, given the game could serve as a new activity that couples, friends, colleagues and even family participate in.
Ultimately, games like STEPN will help promote the fitness and physical well-being of gamers - a benefit that will be well-received by governments, healthcare providers, insurers and tech companies that are trying to gamify and encourage a healthy lifestyle. Additionally, STEPN has a strong carbon offsetting mechanism, where proceeds from the game’s earnings will also be used to buy back carbon credits and offset global carbon emissions.
Unpacking Ocular’s thesis on STEPN
In line with our conviction around move-to-earn games, we invested in STEPN with the following thesis:
STEPN is an early mover in the space. Currently, there are only a few competitors in the move-to-earn space. Being an early mover in the sector presents an opportunity for STEPN to revolutionize the way we think about fitness and how we conduct our daily activities.
STEPN is easily accessible. Many other play-to-earn games have high initial barriers to entry because users have to make a hefty investment to first participate in the game. However, STEPN has a free-to-play trial option. Players can start off in solo mode, which reduces the stress of finding a team or the anxiety of having to engage in battle with others straight away. In addition, STEPN is developing an NFT rental function and a fiat on- and off-ramp feature, which will allow players to easily get access to NFTs and on/off ramp their in-game tokens to fiat and vice versa. This will eliminate the need for users to have a separate DeFi wallet.
STEPN has a fast growing user base. With over 80,000 followers on their Twitter and 46,000 members on their Discord, STEPN has built up a strong and engaged community that will support them through future game/product iterations and highlights the impressive traction that STEPN has garnered in a short period of time.
STEPN operates with a compelling technology stack. STEPN uses their own proprietary app to track movements and has built in various controls to detect fraud and ensure people are actually moving through real steps.
STEPN has an experienced and crypto native team. Yawn Rong and Jerry Huang, the co-founders of STEPN, have a powerful combination of experiences which make them well positioned to become leaders in this space. Through their prior involvement in crypto and gaming, they have collected the skills and know-how needed to build a community, provide an engaging gaming experience and build a sustainable and valuable ecosystem.
STEPN has robust game economics regulation. The team has been considered in designing a sustainable economy which provides players with numerous use cases for their tokens. For example, players can use earned tokens to upgrade a wide variety of in-game items and customize their NFTs. Additionally, upcoming functionality and reward systems will be built for users as the game matures in order to give players and token holders a continuing stream of reasons to remain an active member of the ecosystem.
STEPN offers an important ESG angle. STEPN plans to structure the project as a DAO so that token holders will be able to engage in carbon offsetting through the purchase of carbon credits. As a responsible investor, we truly value a project that not only provides a leading gaming experience for users, but also generates a positive impact for our society.
A final thought: bridging the physical and digital worlds to improve lives
At Ocular, we are enlivened by STEPN’s vision to bring crypto into real life activities. We believe it can potentially be the catalyst for an entirely new genre of games that will benefit users both financially and physically. As we seek out new Web3 primitives that upend conventional thinking, we feel it represents a radical and refreshing idea that the digital and physical worlds need not be at odds with each other, but can work in unison to make fitness fun, social and mentally and financially rewarding.
How to take part:
We have certainly been excited to be a part of STEPN’s community and to start earning through our everyday walks and runs! If you would like to join us on this exciting journey please read below for instructions on how to get started and/or consider purchasing their token ($GMT) on Binance!
Alternatively, head over here to purchase $GMT (StepN) directly.
Ocular is an investment fund focused on the rising asset class of Web3, including DeFi, GameFi, NFT/metaverse and infrastructure. With a tech venture capital and data science background, our team is also deep-rooted in the crypto community. The Ocular fund is managed by Openspace Ventures, a leading Southeast Asia venture capital firm with about $600 million in committed capital.
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Disclaimer: the article is for information purposes only. None of the contents above should be construed as investment, legal, tax or other advice.