Yield Guild Games

YGG is the native token of Yield Guild Games, a decentralized autonomous organization (DAO) and play-to-earn (P2E) gaming guild that invests in non-fungible tokens (NFTs) for metaverse worlds, such as Axie Infinity, The Sandbox and League of Kingdoms. Holders of the token share in the profits that the guild produces.

The token launched in July 2021 at about $1.45. It hit an all-time high of $11.50 in November 2021. The token crashed shortly thereafter, however, sinking to a low of 48 cents in May 2022.

YGG launched with a pre-minted supply of 1 billion tokens. Of these, the founders kept 15%, investors 24.9%, advisers 1.85% and the treasury 13.3%.

Play-to-earn is a genre of video games that reward players with assets of monetary value, most commonly cryptocurrencies. The genre hit it big in the summer of 2021 after Axie Infinity, a monster-battling turn-based combat game inspired by Pokémon, went viral.

These monsters are represented as unique cryptocurrencies called non-fungible tokens (NFTs). To use the monster within a game, a player has to first hold the token; monsters trade on secondary marketplaces.

When the in-game monster NFTs became very expensive, some people rented them out to those unable to afford the NFTs themselves. This practice became popular in developing countries like the Philippines and Venezuela, where some people considered the tokens they could earn from the games a meaningful source of income.

Sometimes, those with the NFTs also provided training to the players. The practice of lending NFTs in this way is called “scholarships,” but it’s classic capitalism: Those with capital (monster NFTs) take the lion’s share of the profit from those who did the work (battled monsters).

Yield Guild Games is a DAO that plays the role of capitalist – it uses funds provided by others in the guild to invest in NFTs, such as in-game assets and virtual land, and lets members of the guild borrow them. Borrowers work the virtual land in these games and are entitled to a cut of the profits.

Yield Guild Games is not, however, a private company. Profits go to those who hold the DAO’s token, YGG. Its value is derived from yields gained from the assets – whether through capital gains or through active play – sponsorships, subscription fees and merchandise sales.

The token can be staked for token rewards and unlocked exclusive content, and to vote on how the DAO spends its money.

Yield Guild Games is the formalization of the practice of lending Axie Infinity NFTs to Filipinos that one of its Manila-based founders, Gabby Dizon, has done since 2018. Fintech entrepreneur Beryl Li and developer Owl of Moistness joined Dizon as co-founders and launched the guild in October 2020. The white paper describes their role as expanding the guild, buying virtual gaming assets and building new features, but it also announces plans to further decentralize things.

Yield Guild Games raised $1.3 million in a seed round led by Delphi Digital and $4 million in a Series A funding round led by Bitkraft.

Of the $13.5 million that Yield Guild Games initially held in assets under management, according to the white paper, the founding team proposed investing 83.3% of the money, and keeping the remaining 16.7% to run the operation.

Aside from Axie Infinity, Yield Guild Games has also invested in Star Atlas, Illuvium, Mavia, Splinterlands and Vulcan Verse, among others.