Leading GameFi platform follows in the footsteps of Axie and Gala
Leading Harmony network dapp DeFi Kingdoms has announced its own blockchain, the DeFi Kingdoms Blockchain, also known as DFK Chain. Partnering with Ava Labs, DFK Chain will be the home of the previously announced Crystalvale expansion.
With the announcement of the DeFi Kingdoms Blockchain, the team hopes that it will become a go-to ecosystem to launch GameFi and other blockchain gaming experiences. These would then of course connect to DeFi Kingdoms: Crystalvale.
DeFi Kingdoms and Ava Labs have essentially created a sister chain to the Avalanche blockchain. They have dubbed this process an Initial Subnet Offering, or ISO. They consider this a start of a bigger plan to expand blockchain services and create tailored ecosystems. In this case, DeFi Kingdoms would be the provider of such a tailored ecosystem.
The rise of play-to-earn gaming and games intertwined with DeFi and NFT mechanics have become wildly popular of late, and DeFi Kingdoms is one of the rising stars. The GameFi platform attracts record numbers of users and knocks on the door of mainstream customers looking for an on-ramp to crypto. Its simple-looking yet highly complex financial mechanics have helped onboard people perhaps too afraid to try DeFi dapps.
Subnet not mainnet
DeFi kingdoms started on the Harmony blockchain and recently expanded to Avalanche. Now, in the context of this recent announcement, it’s more clear why the team decided to launch on Avalanche. Avalanche subnet technology allows projects to section off a group of Avalanche validators and commission them to validate additional blockchains outside of Avalanche’s primary three chains. Perhaps the $290 million incentive program by Avalanche to spur the growth of subnets also helped a bit.
DeFi Kingdoms will run and manage their proprietary blockchain by commissioning a subnet. DeFi Kingdoms Blockchain is an EVM-compatible blockchain that will be validated by subnet and uses the proof-of-authority and proof-of-stake consensus algorithms developed by Ava Labs. Moreover, it is hoped that DFK Chain combined with Avalanche Subnet infrastructure will unlock new potential for DeFi Kingdoms. Technical information on Avalanche subnets can be found here.
JEWEL as a gas token
One of the most significant advantages of building a specific DeFi Kingdoms Blockchain on a subnet is to empower the JEWEL token more. JEWEL will not only serve as a Serendale Governance Token but also as the network token of the DFK Chain. Players of DeFi Kingdoms: Crystalvale will use JEWEL to pay for transactions on DFK Chain.
Significantly, this decision does not increase the total market capitalization of the JEWEL token. JEWEL will continue to be minted in the Master Garden in Serendale. In-game bridging will be provided to allow for JEWEL to be moved to DFK Chain to pay for transactions and provide liquidity. The effective total supply across all chains remains at 500 Million JEWEL.
Now that JEWEL will be used for gas, there is also the issue of allocating those fees. A portion will be given to the designated wallets of the validators to allow DeFi Kingdoms to attract more validators and further decentralize the chain. An amount will be burnt to continuously increase the value of JEWEL by implementing a consistent burn mechanic and deflating the supply. Additionally, a portion will be sent to the Quest Fund to reward the overall community and players.
$15 Million in incentives
In partnership with the Avalanche Foundation, DeFi Kingdoms will be incentivizing the early phase of the Crystalvale launch on DFK Chain with a total of $15 million in incentives: half in Crystal and half in AVAX. These incentives will be awarded as part of ongoing airdrops and Ice Garden emissions in the earlier stages, where certain pools will be subsidized with AVAX. More details on incentives will be released in the coming weeks.
Starting on Avalanche, DeFi Kingdoms will expand to create what it’s calling Outposts on multiple chains that will include features to make onboarding onto DFK Chain seamless and easy for players. These will consist of integrated bridging and trading through a local dex to make it easier to obtain JEWEL to pay gas fees and bridge it over without leaving defikingdoms.com.
The bigger goal of Outposts is to reduce barriers to entry into DeFi Kingdoms. Outposts will have a fiat onramp integrated to help with the local chain gas fees, tutorials, and RPC switches to DFK Chain for the first time. Certain chains will even get their own dedicated mini-zone unique to their chain.
Bridging from other chains to DFK
DFK is its own chain and requires bridging support from all chains, including Harmony and Avalanche C-chain. As already seen in Serendale, DeFi Kingdoms: Crystalvale will utilize “The Docks” zone as an in-game interface that taps into bridging services. Although the Outpost zones assist in the initial onboarding to DFK Chain, The Docks will be the ongoing zone for all things related to moving tokens on and off-chain, including fiat on/off ramps.
At launch, DFK Docks will support JEWEL, xJEWEL, and AVAX from Avalanche and Harmony chains but will expand in supported tokens and chains over time. It’s hoped The Docks will provide players a seamless and native experience for bridging to and from DFK Chain.
Running a subnet on the Avalanche network requires a set of validators. To start, DeFi Kingdoms will partner with several teams to establish a genesis validator set. They plan to open applications for community members, guilds, and other partners to join the validator set and earn rewards in the short term.
The subnet technology requires all subnet validators to be primary Avalanche Network validators. The current staking requirement of Avalanche is 2000 AVAX. In addition to this stake, validators hoping to join the DFK subnet group will be required to stake JEWEL and be whitelisted for the subnet. As the subnet technology advances, the team hopes to make DFK Chain a permissionless proof of stake network for anyone to join and secure.
Due to the high volume of data and transactions required to run game logic on-chain, RPCs are essential for players’ experience. The partnership with Ava Labs and the POKT network will provide a public set of RPC nodes at launch. Post-launch, the team plans to commission internal resources to provide private and public RPCs that will grant access to community members, program participants, and official partners to make playing or developing on DFK a smooth experience for all.
GameFi, the new DeFi?
The team at DeFi Kingdoms has fundamentally built a decentralized exchange that allows users to hold a monetary token and own a usable token with value, designed to give back to token holders in fun ways. Such as letting players build an operation, level it up to increase returns, and add daily quests to collect rare NFTs. Items that augment and impact the rewards and returns.
The game launched in late August 2021, just as DappRadar reported 1.54 million daily unique active wallets connecting to dapps during Q3. Furthermore, play-to-earn games continued to drive usage within the industry, with the number of unique wallets connecting to game dapps increasing by over 140% when comparing Q3 2021 with Q2 2021. Around that time, Splinterlands became one of the most used dapps in the industry, increasing usage by a staggering 1,376% quarter-over-quarter. While Axie Infinity became the most traded NFT collection ever, surpassing $2 billion in historical trading volume.
DeFi Kingdom’s rise to success has several critical elements to thank for its triumph thus far. As mentioned, the timing was everything, and arguably the team could not have unleashed the platform at a more appropriate time. As gas prices soared and users started to look elsewhere for opportunities, DeFi Kingdoms was perfectly positioned.
The launch of the NFT marketplace was a massive catalyst in both the numbers of active users and transaction volume on the platform, helping to cement the game as a serious contender with a strong roadmap and ambitions. In early January 2022, the team announced reaching a landmark $1 billion in total value locked, further showing the popularity of the platform and the play-to-earn genre more generally. Expansion felt inevitable, and steps made into the Avalanche ecosystem are clearer.
DeFi Kingdoms follows in the footsteps of leading dapps such as Axie Infinity who launched their Ronin chain only to go on and smash all their previous records last year. Additionally, Gala games announced its intentions to build its own blockchain last week. Increasing numbers of active wallets and transaction volume should come as more people come to understand the opportunities presented by dapps like DeFi Kingdoms.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds ETH, BTC, AGIX, HEX, LINK, GRT, CRO, OMI, IMMUTABLE X, ENS, GALA, AVASTR, GMEE, CUBE, RADAR, FLOW, FTM, BNB, SPS, WRLD, ATOM, and ADA.