Is there a future for IguVerse, or is it just another scam?
IguVerse reminds of one of the most successful games from the 90s, Tamagochi, where players had to take care of their virtual pets residing inside a simple black and white gadget. And, I bet, you’ve probably heard about StepN, a Web3 app which introduced the move-to-earn concept allowing players to earn rewards simply for walking. IguVerse has gone a few steps further. This Web3 game combines three different mechanics of earning rewards: play-, socialize-, and move-to-earn. Simply put, one can earn tokens for playing a simple arcade mini-game, walking a virtual pet, and sharing its pics on your social media. But, in case of inactivity, your pet will lose health points and eventually die.
Every virtual pet in this game represents an NFT which can be created from a real photo or with the help of a generative AI tool.
A player’s NFT has a certain rank that influences the number of daily rewards. The simplest NFTs can be minted without any charge. However, their owners can receive a maximum of 30 IGUP tokens daily. On the other hand, the owners of rare NFTs minted for $900 can earn up to 1,893.6 IGUP daily. On March 7, 1 $IGUP traded for around $0.0175, so a rare NFT owner was potentially able to earn up to $30 daily. At this point, the rare NFTs are the most effective assets in the game, however, the team aims to introduce more ranks in the future. And, of course, players can take care of several virtual pets in one app to increase their profits.
Brief introduction to the project: the revenue model and the tokenomics
IguVerse employs the model with two tokens, $IGU and $IGUP. The first one, $IGU, is a governance token, and the latter $IGUP serves as the reward currency.
$IGU is a BEP-20 token with a maximum supply of 400,000 units and a number of use cases aimed to boost the sustainability of the economy, like:
- Minting, upgrading, and restoring NFTs,
- Feeding pets,
- And staking.
In the future, the team plans to implement more options to spend $IGU, including spending the tokens on the NFT marketplace after the launch or buying items and mystery boxes. At the same time, B2B customers will be able to pay for advertising in the game with these tokens.
The second token, $IGUP, is used as rewards for players. Though its supply is unlimited, the devs have implemented a burn mechanism to keep inflation under control.
Basically, the game economy is fueled by two important element:
- Attracting more users by viral marketing on social media by the active user base without additional marketing costs.
- Introducing extra features, incentives, and items to increase the demand for the game tokens.
The team also aims to create a complex advertising network and generate more income for the project. In this regard, it’s important to mention that tasks of sharing your virtual pet’s pics on social media also involve verification. Other users have to check the entries of their peers to prevent cheating and using multiple accounts.
Moreover, the eligible social media accounts must have at least 500 followers on TikTok or 100 followers on Instagram. The full list of requirements is available here. And there is an example of a social media entry below.
On top of building a wide and active community of pet owners with a minimum number of fake accounts, IguVerse also aims to support charity funds. Every user is required to donate a minimum of 1% of total rewards to animal welfare organizations, but they can also opt to share more game profits with charity funds.
The rise of IguVerse
On May 20, the IguVerse team announced the closing of the seed investment round with just one investor and $1M in tokens locked for 2-year vesting. And, on June 25, this round was followed by the private sale of the IguVerse tokens.
Next, the team was primarily focused on user acquisition by various incentives, including quizzes, contests, etc. and building their application. The app, which was rolled out on October 31, attracted a whopping number of 15K registered users in just two weeks.
This rapid expansion of the user base can be attributed to the combination of two important elements: a viral marketing idea behind the project and a generous referral program.
IguVerse aims to build a network of microbloggers. That means that the team wants to onboard thousands of ordinary users of Instagram and Facebook. Unlike popular influencers and celebrities, these participants closely interact with their followers, as many of them are their friends, family members, or colleagues. What is more important, these microbloggers can deliver native and reliable content for the audience.
However, the IguVerse rise in popularity probably has another important ingredient – a generous referral program offered by the game. The IguVerse users can receive 2% of the rewards enjoyed by their referrals, which is a pretty standard. But there’s also a second referral line: users can earn 1% of their friends. The user also gets a 5% discount on future NFT mints for inviting his friends.
Thanks to the marketing strategy, the IguVerse app reached 50K+ downloads on November 27, and subsequently started the year with more than 200K downloads. Later in January, Dappradar also recorded a growth of active wallets, which reached the peak of over 8K units in the beginning of February. The volume of on-chain transactions totaled to a whopping number of $576K on January 19 and $486K on February 15. The increase in volume of transactions may be attributed to a 50% raise of the NFT minting fees and the listing of the $IGU token on the popular exchanges respectively.
In mid-February, a number of popular exchanges, including OKX, KuCoin, Huobi, Gate.io, and others, noticed the hot GameFi project and listed its token, $IGU. After the listing, the price of $IGU reached its all-time-high of around $0.28, and the trade volume exceeded $25M.
Later, on February 24, the second token, $IGUP, became the top gainer in the whole BSC ecosystem.
At the same time, many IguVerse players had their own success stories and managed to earn reasonable rewards in this game. For example, this game’s ambassador and owner of several NFTs earned $24 daily for completing simple tasks.
To sum it up, this project has achieved tremendous results in the number of active users and trading volume, while the game also provided users with the opportunity to earn lucrative rewards. Everything went smoothly before February 23, when the team literally changed the rules of the game.
On February 23, the developers announced their plans to redesign the app in order to fund the further scaling and development, including the introduction of their own AI-powered NFT marketplace, advertising network, and DAO.
The team explained that the current economic model was not sustainable enough and could cause a crisis in the long-term. The team had to make a difficult choice and implemented the following changes:
- The number of the rewards available for daily claims was reduced to 1%. At the same time, 99% of the daily rewards were set to be converted to the new token, VIGUP. It can be claimed in the form of the new token, IGUAI, after the launch of the new NFT marketplace in the future.
- All IGUP tokens were set to be automatically converted to IGUAI after the listing.
- Lifespan of pets increased 20 times.
- 50,000 IguVerse NFT holders were scheduled to receive the new Genesis NFT allowing them to share the marketplace and advertising profits.
Although these measures are described as temporary, the announcement doesn’t contain any clear dates.
As a result, on March 6, the number of active wallets dropped to 769 units with a total of 900 daily transactions and 95$ in volume. However, less than two weeks earlier, on February 22, the project engaged with almost 8K active wallets generating approximately 35K transactions and around $4K in volume.
But these are just cold facts. The worst part was the community reaction which was obviously negative. Some gamers had invested big money in the game NFTs and expected high profits. After the announcement that changed the rules of the game, the majority of gamers had doubts on the future of the project, while some parties openly called the project a scam.
What urged the team to change the rules of the game
Changing the rules of a game which has already onboarded thousands of gamers is a hard choice. And the team probably had to face a set of enormous challenges before doing this.
The first one was apparently connected with a liquidity problem. As stated above, IguVerse reached the maximum of unique active wallets in February. The overall trading volume of $IGUP, the reward token, was also growing during this month and reached a local high of $795K on February 23.
The increase in trading volume may indicate the efforts of the “early comers” with premium NFTs to maximize the game profits and cash out the rewards.
Another problem was caused by the imperfections in the game design. To make the game economy secure and sustainable, a large share of tokens has to circulate inside the ecosystem. But to achieve this, players need more options and incentives to spend the rewards in the game. This reasoning can also explain the recent decision of the team to introduce more PvP game modes, including their plans to launch a guessing game and a beauty pageant in the app.
One more hit to the game economy was probably caused by the multiple listings on centralized exchanges. At the time of writing, on March 9, the $IGU token is represented on 13 exchanges, including Huobi, Gate.io, OKX, KuCoin, and many others. As a rule, the exchanges claim that they list coins for free. Though, some projects have reported billing for this procedure. And, of course, we’ve also heard before about extra fees, like security deposits. Such expenses could also undermine the project’s financial sustainability.
It’s difficult to assess the situation with IguVerse and provide a definitive answer about the future of the project. On the one hand, there are no founders trying to escape from the users. And that is great because the team is in touch with their audience and tries to fix the situation by implementing new gameplay elements, activities, and features combined with other initiatives, including the above mentioned AI-powered NFT marketplace and the advertising network. These steps certainly have many chances to fix the economy of IguVerse.
At the same time, the drastic changes in the game rules have affected the credibility of the team. And now, the main question is whether the project is able to win back the trust of the audience, given that many users feel scammed after having invested vast sums in expensive IguVerse NFTs.
For this reason, the best advice for newcomers looking to start playing IguVerse and investing money in it is to do a comprehensive research before joining the game. And, of course, only invest what they can afford to lose.
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