Game developers and publishers rely on several methods of revenue generation from their games and value generation inside the games. Players are more passionate when there is something of value at stake. This makes gamed-based assets a tool to help achieve the optimal engagement as well as an opportunity to earn profits and monetize the game for the developers. MGO tokens, a cryptocurrency, has seen a sharp rise in usage due to this trend. Apart from this, what is the reason for interest in MGO tokens? Let us have a closer look.
MGO tokens are used by game developers on Xsolla platform for withdrawing their profits instead of fiat. Xsolla supports multiple payment options and payment systems. But more developers are using MGO tokens instead of any mode of payment using fiat. To find the reason, let us first understand Xsolla platform and how it works.
Xsolla is a decade-old platform that allows developers to accept payments for in-game items. Players can buy these using fiat currencies. Over the last ten years, Xsolla has become the go-to place for gaming industry crossing over $100 million in turnover month after month. It also boasts of a half a billion users from over 200 countries letting them buy in-game assets in over 500 games and 100 different currencies including MGO token that can be bought through 700 payment providers. The platform processes over 40 million transactions annually. Xsolla’s suite of tools for game developers includes billing, payment, game distribution, and marketing tools.
With a huge number of transactions and money being processed by Xsolla, out of the 700 payment providers, withdrawals can only be processed in fiat or MGO token. The rising popularity of MGO as a withdrawal currency only shows the demand for MobileGO project. It is validation of product-market fit and adoption.
Game developers and publishers are cashing out their profits on a regular basis through MGO tokens. As of now, over a dozen different game publishers are doing it with the volume close to a quarter million dollars. As awareness rises, more teams will prefer using MGO tokens replacing fiat currencies. At the current turnover, achieving a 30% rate on Xsolla will make the transaction volume on MGO close to $30 million per month.
What is driving the project?
Two biggest reasons for this adoption of MGO in place of fiat are time and cost. These reasons are the same reasons why cryptocurrencies like Bitcoin were invented in the first place. Cryptocurrencies generally function by eliminating the middlemen, providing a fast and transparent process of transferring value.
When developers withdraw fiat from Xsolla, it takes quite some time for them to receive the money in their bank accounts. The processing times range from a few days to weeks or even months at times. The money that is earned by these developers is stuck in the financial system for a long duration of time.
Meanwhile, they still have to pay the salaries, contractors, servers and for the equipment needed. All the costs are to be paid immediately while the revenue is deferred. By contrast, MGO tokens are transferred instantly and can be withdrawn almost instantly. Once the funds are in their wallets, these transactions are irreversible. This means there cannot be any charge-backs like in credit card processing.
A second reason is – cost. When profits are withdrawn in fiat, there are many middlemen like payment gateways, banks, and processors that take transaction fees and commissions. These fees can be quite hefty and can take a sizeable cut from a game developer’s hard earned money. In this case, MGO payouts are not associated with hefty fees. The tokens can be transferred to any Ethereum supported wallet or a crypto exchange like Bitfinex or Bitforex. MGO tokens, once withdrawn, are completely in control of the user and can be exchanged for Bitcoin, Fiat, Ethereum or USDT on any of the supported exchanges.
Future of MGO
According to analysts and experts, the total volume of the mobile gaming market will surpass 110 billion USD in the next two years. This volume is comparable to that of the higher education market globally. Additionally, the number of mobile game and app user has exceeded 500 million.
MGO tokens have been traded with steady volume since last year but the market cap is only $25 million.
Both Xsolla and MGO will keep growing at a staggering rate because of the promise of blockchain technology combined with real-world usage.