This section elaborates on the main pillars of our strategy, including Right-of-Game, Genesis NFT collections, Decentralized Autonomous Tribe, the economy for our ecosystem of games, and much more. This document serves as a guide for both existing and new members of the Pixelmon community to navigate our ecosystem and access available information.
We maintain a high-level view of each topic, aiming to balance complete information with clarity and simple explanations.
This document will be hyperlinked to other materials that we produce and share over time. For most topics, we will use links to articles, tweets, or Discord announcements to provide more detailed information to avoid overcrowding this space.
Finally, this is a live document. We will update and improve it with more and better information as the project evolves, based on your feedback and needs.
Since Nakamoto’s 2008 paper, the growing interest in blockchain-based decentralised systems has prompted the rise of a multitude of different applications and solutions in the web3 space. We have seen decentralisation (or proposed solutions) across a wide variety of industries, but the majority of implementations with sizable mass adoption to date have been confined to the DeFi vertical. One noticeable exception is NFT technology, which has seen a large adoption spree in recent years, initially driven by digital artists and collectors who found NFTs to be a perfect means to eliminate intermediaries, safely transfer ownership of unique images (and sometimes the underlying IP) and earn royalties from secondary transactions.
More recently, new projects have minted NFT collections as promises of future utility across different verticals. Among these, we believe that gaming will quickly become the first consumer market to benefit and drive mass adoption of blockchain and NFT technologies.
The first attempts to decentralise game asset ownership through the blockchain used NFTs as pay-to-play or VIP-area gateway tickets to the game. In an attempt to justify high prices for these pay-to-play privileges, the solution they opted for was to embed earning into play itself, thus justifying NFT prices as a pay2play & play2earn relationship. The unfortunate outcomes of this strategy were multiple, including:
Instead, our intent is to create the first Decentralised Game IP Ownership (DGIO) system that provides the right incentives to Play to Own (P2O) while leveraging the proven revenue model in Free to Play (F2P) gaming and microtransactions. At the same time this system sets the basis to expand the IP across multiple verticals beyond gaming.
The key to achieve the above lies in clearly differentiating between the interests of those parties looking to purchase artwork and commercialise the underlying IP assets from the interests of gamers looking to consume the product – not just in company strategy but in the underlying legal and contractual rights allocated among the NFT collections.
In particular, we envision a 2-tiered NFT system that we have named Right-of-Game (RoG) system, which is composed of L1 Genesis NFTs and L2 In-Game NFTs. The L1 Genesis NFTs include shared IP ownership over a specific asset or asset class, while the L2 In-Game NFTs include in-game assets owned by players. At its base, (i) L1 Genesis NFTs are a product for parties interested in acquiring artwork and sourcing, negotiating, and commercialising the shared IP rights associated with that artwork (or “Asset Owners”) and (ii) In contrast, L2 In-Game NFTs are a product for consumers/gamers (or “Gamers”).
With RoG in place, use of in-game assets is decentralised. Free-to-play (F2P) players who are looking to participate in the ecosystem at a level of mass adoption can obtain these affordable resources through gameplay or microtransactions (primary & secondary), while potentially higher priced Genesis ownership rights are separated from the gameplay flow.
The RoG system will be supported by a system of in-game currencies (off-chain) specific to each game, that will function as the currency for the players, enabling liquidity in the game’s primary market. The currencies will mostly be purchased for FIAT in-game or released to players in the form of rewards and incentives. Cryptocurrencies will also be allowed as currency for web3 players to trade in-game NFTs peer-to-peer in the ecosystem’s marketplace.
RoG is also key to expanding the gaming IP across multiple channels and diversified franchises: with fractionalized IP and royalties’ rights, Genesis NFT holders are incentivized to source, negotiate, and commercialise that IP and earn royalties.
Finally, a governance token will enable the creation and activity of in-game Decentralised Autonomous Tribes (DAT). We envision DAT as the first IP management decentralized organisation, with operational costs financed by fees on microtransactions. The DAT will have ownership over IP tribe-specific events and decisions, for example: selecting artist and artwork for IP expansions, promoting partnerships, conducting marketing activities, electing representative roles within the DAT, defining governance token redistribution plans, organising tournaments, and much more. The DAT is envisioned to be the organic promotional agent of the Pixelmon ecosystem.
The DAT and the RoG infrastructure can also solve the long-standing issue of content scalability in gaming by enabling a self-sustaining User Generated Content (UGC) strategy. Creators can be financed by the DAT with grants to upfront their development costs, decentralise the IP they create, and hold a productive share of their creations, while enabling in-game usage for F2P with the L2 NFTs. This approach makes the IP of our games and content fully decentralised from creation to licensing. Decentralised creation can be applied to all content: Creatures, Gear, Map Expansions and even quests.
With DAT enabled UGC and decentralised IP ownership powered by RoG, the game becomes much more than just a game. It becomes an IP ecosystem where all three stakeholders have clear roles that provide value to each other in a scalable manner:
As a result, the incentives for all constituencies are aligned, and each of these participants is incentivized to participate in and create a better IP ecosystem.
Right-of-Game is an innovative system design that uses backend blockchain technology to improve the way gaming media franchises are built by decentralising ownership of the game IP.
The first practical application of RoG will be a sub-licence from Genesis NFT holders to the Pixelmon games, which will use the IP associated with creatures, trainers and gears for in-game digital assets. This will result in two classes of NFTs with different characteristics: Genesis NFTs and In-Game NFTs.
Within RoG, Genesis NFTs allows for IP decentralisation, assigning shared IP rights of the underlying art to their owners. As such, these NFTs will include a contractual right to royalties derived from any commercial use of the corresponding IP, in part from the proceeds generated by the in-game NFTs.
These NFTs include the current and future collections that are released on the Ethereum L1 such as Creatures and Trainers (inclusive of skins, gears, and armours). They don’t provide any in-game utility, but all Genesis NFT holders are expected to be airdropped an in-game version of their NFT (dependent, in part, upon full in-game functionality of such NFT).
In-game NFTs, on the other hand, will be minted on an L2 blockchain and will comprise all of the main digital assets available in-game, including Creatures, gears, skins and armours.
These NFTs allow for fully decentralised ownership of in-game assets: each player can obtain these assets for free through gameplay or purchase them in the game store and then trade them on the secondary marketplace with other players.
Genesis NFTs holders are provided with ownership rights over a portion of the items/character’s IP, as well as the ability to source, negotiate, and commercialise that IP and earn royalties. This constitutes a decentralized incentive system to grow the IP across multiple verticals, with a consequent positive flywheel effect on increasing the overall IP value and deriving further commercial opportunities.
At the same time, RoG will allow Artists and Creators to contribute to the project with their works, obtaining funding and royalties (more about this can be found in the “Creator Economy” section below)
With RoG in place, we implement new solutions for the game ecosystem’s success:
There are 10,005 NFTs available, each representing one of 69 different species, 4 Origins (Water, Fire, Air, and Earth) and 6 rarity tiers. Each creature is revealed by hatching an egg.
All L1 Genesis NFT owners, including all Evolutions of Pixelmon Generation 1 creatures, are expected to be airdropped an L2 in-game NFT copy of their Pixelmon creature (dependent, in part, upon full in-game functionality of the NFT). This L2 NFT will display additional features in-game, like glowing skin, that will make it unique and distinguishable from other characters.
E1 Genesis NFT owners were eligible to receive a trainer NFT airdrop through staking, which is now closed.
As part of the Right-of-Game ecosystem, all owners of Genesis NFTs will have the right to commercialise the use of the associated intellectual property and receive a shared royalty for any commercial use of the same.
For the Pixelmon games, the royalty calculation will take into account the total proceeds generated by the IP times a royalty percentage, which increases with the rarity tier of the NFT, as well as the overall usages of the character by players within the game.
Owners of Creatures Genesis NFTs will be able to burn an Evolution Serum NFT to receive a higher evolution airdrop. All creatures can evolve twice from their E1 form, and only selected creatures will have a third evolution step (E4). The number of evolutions is capped, and higher evolutions will be less in number: there will only ever be 2,800 E2 serums, 1,000 E3 serums, and 33 E4 serums. The serums are distributed to the Genesis NFT holders via raffles (like Trainers Adventures) and as community event prizes. Particularly for access to E3 and E4 serums, holding all available evolution steps of a specific species (a.k.a. flushes) will be of importance.
All evolutions can claim RoG royalties: a fixed share of the total Species royalties will be allocated to each evolution. Hence, if that species has fewer E2 NFTs, anyone that burns a serum to create an E2 NFT for that species will have a higher upside. See below for an example using Borg:
This mechanism incentivizes a more even use of serums across all Species, given that higher serum usage on one species will dilute the RoG royalties. You will be able to find more details about RoG mechanics applied to evolution paths in an upcoming article.
Trainer NFTs is a collection of 7,000 unique trainers, generated as unique permutations of 176 different unique gears, armours, and accessories, including 20 unique full-body outfits and 40 unique weapons. The collection includes 20 Gold Trainers, uniquely customised NFTs released to the original Elite trainers’ holders.
The rarity of the Trainer is determined by the upper body clothing’s rarity. Each trainer has been made available for claim by an E1 Genesis Creature NFT holder matching the rarity tier of the Pixelmon. Given the sub 100% claim ratio the Trainer collection is smaller than the Pixelmon E1 one.
Similar to the Pixelmon Genesis NFTs and according to the Right-of-Game system, each Trainer NFT includes the shared IP rights of the in-game respective set of gears and skins that each trainer has in a unique combination. For this reason, they will have a contractual right to source, negotiate and commercialise the shared IP rights associated with that artwork, both in-game and any other commercial use.
Finally, Trainer Genesis NFT holders can download the original 3D source files of their trainers and related skins and gear after they hold the NFT for a minimum of 30 days.
Players will have different ways of accessing the game’s digital assets, whether through gameplay (P2O), purchasing from the game store, or trading with other players on the secondary marketplace. This structure accommodates the preferred access points to the main types of players in the ecosystem. While all players will have some degree of access to P2O through gameplay, we expect Web2 players to be more familiar with a primary in-game shop for purchases, and web3 players to prefer a peer-to-peer exchange.
The Web2 economy of the games is built around standard elements of F2P game economic models, such as the existence of dual (off-chain) currency system composed of one hard currency acquired via in app purchases (IAP) and one or many soft currencies that serve different purposes in the games and can be earned through gameplay and player progression.
On the other hand, a web based dedicated P2P NFT exchange for in-game assets will power the Web3 economy. Here, Web3 players will be able to exchange their L2 NFTs with each other and trade them for cryptocurrencies and stablecoins.
This strategy achieves multiple desirable outcomes:
This section discusses the Decentralized Autonomous Tribe and the Pixelmon governance token. The design of this token is still in the early stages, and the features discussed in the following sections will be revised and modified further with the inputs and support of our community. The creation of the DAT and the release date of the governance token are yet to be determined.
The four Tribes will be organised into a DAO - a Decentralised Autonomous Tribe (DAT). The DAT will become the collective agent deciding the evolution and economy of the Pixelmon IP and game ecosystem. The DAT will provide for a split sub-governance and voting tools for each of the 4 Pixelmon Tribes or even to individual Species holders on matters that pertain only to the tribes and species specifically.
The founding and establishment of the DAT are key pillars of the strategy and overall success of the Pixelmon ecosystem. We want to empower Genesis NFT owners to have decision-making power over specific decisions pertaining to their tribes' IP. This means making them the de-facto builders, managers, and promoters of the games and content within wider and more “organic” communities.
The DAT will have a dedicated governance platform, elected representatives, for each of the 4 tribes, and technical roles.
All this will be possible only with the support and progressive involvement of our community of NFT owners and players, empowered by a solid Governance Token system. The Governance Token’s main goal is to allow players and stakeholders to propose and participate in management and organisational decisions for their own Tribe’s IP.
The DAT’s governance will be enabled by a Governance Token. Governance Token holders will need to own a Genesis NFT associated with a specific Tribe to be entitled to access the tribe’s specific governance activities, such as voting and proposing new resolutions to the DAT community.
The token’s supply distribution will aim to incentivise fair participation from the most active members of the community, preventing the accumulation of governance power into the hands of few uninterested or malicious users.
A more precise distribution and emission plan will be released closer to the Token generation Event (TGE) date. The exact TGE date is not yet defined and will depend on game development progress as well as overall market conditions.
Once the game is live and the DAT is operational, it will be responsible for distributing the available supply of Governance Tokens to the most active DAT participants. To fulfil this mandate, DAT will manage the share of the Governance Token allocated to its treasury and will be allowed to actively absorb tokens from outside sources, such as payments from third parties and in exchange for exclusive utilities.
The main function of the Governance Token is to attribute voting power to its holders. A higher amount of token spent on a vote corresponds to a higher weight for that vote.
The most common governance model that has emerged in early DAOs and DeFi projects - often referred to as 1-vote 1-token - has led to many distortions in its practical applications, among which: low decentralisation in governance distribution (across the 10 major DAOs less than 1% of all holders have over 90% of voting power), tragedy of the commons and low participation of the smaller holders (for 99% of DAOs less than 0.5% of governance token holders actually participate in voting on proposals), weakness towards malicious attacks through bulk coin purchase or delegation/lending programs via CEXs, and potential sybil attacks.
The governance token logic we are considering wants to tackle these issues with a new governance framework based on the latest solutions proposed in the literature and applied in some early projects:
The governance powers available to the members of the DAT are varied, ranging from electing representatives with delegated powers to making decisions about certain game mechanics such as fees and tournaments, as well as budget allocations.
Over time, the Pixelmon tribes will have a growing set of governance powers, enabling them to become the builders, managers, and promoters of the game within a wider and more “organic” community.
Here are some examples of the decisions holders of governance tokens might have power to vote on:
We believe that the Decentralised Autonomous Tribe (DAT) with the Right-of-Game tools can help solve the long-term issue of content creation scalability in the game industry, i.e., the need for increasingly new content in successful games.
In our vision, future expansions of game content and the associated IP, including new generations of Creatures, gear, armours, skins and full regions, will be created by individual artists, and professional studios.
A full-fledged User Generated Content (UGC) system is needed to enable exponential and decentralised content creation within our suite of content and games, turning Pixelmon from a fun game to play an IP ecosystem that is grown and maintained by its users.
Such a UGC system is enabled by the DAT and RoG: DAT can fund the artists selected by the community with grants, and they, in turn, can distribute their IP while earning royalties from their art, by releasing Genesis NFTs of their creations. In this way, artists are funded and rewarded for their creations, IP owners have an incentive to find new commercial deals, strengthening the IP, and gamers who now have access to growing quality content can create revenue and value for the ecosystem via In-Game microtransactions. This system benefits Creators, Gamers, and Asset Owners alike in a sustainable manner.
Pixelmon NFTs and other digital assets are not intended to be used as investments and should not be considered as such. The value of NFTs and other digital assets can fluctuate greatly, and there is no guarantee of profit or return on investment. If you choose to purchase a Pixelmon NFT or other digital asset, you acknowledge that you are doing so for the sole purpose of owning and enjoying the digital asset, including its in-game use. We assume no responsibility for any financial loss that may result from the purchase or sale of a Pixelmon NFT or other digital asset. Do not purchase any Pixelmon NFTs or other digital assets with the expectation of profits, either from price appreciation, the potential receipt of future airdrops (which may never occur), or otherwise.
Certain statements that we make in this paper may constitute forward-looking statements, including information concerning potential licensing revenue for RoG, future airdrops and the expected roles and responsibilities of members of Tribes. These forward-looking statements are not guarantees, and they involve risks, uncertainties and assumptions and there can be no assurance that those potential future events will occur. We caution users not to rely on any forward-looking statements and expressly disclaim any obligation to update any forward-looking statement in the event it later turns out to be inaccurate.