XBorg is a GameFi protocol shaping the future of digital and gaming applications. This article explores exactly how they are achieving this goal on a technical level. Though prior to understanding XBorg, one must consider the space they are developing in.

Gaming and Web3

Gaming is one of the largest sectors in the entertainment industry, generating billions of dollars in revenue each year, with indications that its growth is to exponentiate over the coming years. However, traditional gaming industries and esports are beginning to be challenged by new frontiers, Web3 gaming, and esports. 

Building upon the concepts and infrastructures of Decentralized Finance (DeFi) and traditional gaming came the inception of a new sector, GameFi. Though not void of adversity, GameFi has begun to establish itself and pave the path for Web3 esports. In comparison to its traditional counterpart, the scene is at a juvenile stage, yet, with the appropriate support, it will establish itself as the next phase of the industry, posing a significant threat to both traditional esports and gaming structures.

There are around 3 billion gamers worldwide, and the number is set to exponentiate by 2024. The videogame market is worth around $190 billion, and it is significantly contributed to by esports and microtransactions, amounting accumulatively to around $1 million to $30 million, respectively, both expected to scale with the gaming industry (Clement, 2022; Gough, 2021; Hirschfield, 2022; Howarth, 2023).

However, of the entire revenue that is generated, the players receive no tangible benefits. The value chain is disproportionately one-sided, where the main generator of the revenue is defined purely as a consumer. One can consider the example of Fortnite, a popular game that made around $1 billion in microtransactions. However, the source of that revenue did not receive any benefits or assets they genuinely own. Additionally, the players generate a host of data that allows Fortnite to create a steady stream of offerings. Such an approach will not continue to be as scalable in the long run when players are demonstrated an alternative, something that many are not aware of existing currently. Web3 gaming and esports organizations like XBorg were born in order to dismantle these power asymmetries and reimagine the value chain. 

Despite the challenges facing blockchain gaming and the overall crypto landscape, GameFi and Web3 esports demonstrated significant uptrends in 2022. In a study published by Dappradar it was demonstrated that 49% of the activities that occur on blockchains are traced back to GameFi projects (such as STEPN , Beam network , Gensokishi Online , Illuvium , APE , Gala Games , Decentraland , Sandbox , Ultra , Axie Infinity and Yield Guild Games ). Additionally, with this influx in activity so came transaction counts, which increased by nearly 94%, reaching a total of around 7.44 billion (Gherghelas, 2022). This traction has led many non-crypto native organizations to move toward adopting blockchain gaming, such as:

• Riot games - Blankos Block Party, and the yet-to-release titles of Grit and The Bornless
• Ubisoft - Skyweaver
• Amazon’s activation programs - Giving many grants and support to the development of blockchain games such as The Bornless

Barriers to adoption

However, this new frontier faces certain barriers slowing down its mass adoption and inevitably hampering its esports potential. Some of the areas that pose a challenge to the space are:

• Lack of pivotal tech for Web2 players: At this juvenile stage, there are not many projects offering solutions that are accessible and innovative to non-crypto native gamers and enthusiasts. This, however, is also greatly attributed to the limited understanding and the readily available information.
  
• Incubation: Games being developed on Web3 face much more changes than traditional games. Not only must they develop a game, but they must also create communities without the support of established studios, and create healthy and unique in-game economies that are long-lasting. Often times, projects that do obtain funding seldom have access to networks that help streamline the entire process and offer them safety nets.
  
• Limited understanding: As mentioned in the first point, there is a general lack of understanding of the space. GameFi is a relatively new concept, and non-crypto native users may not be familiar with blockchain technology. The lack of knowledge and understanding of how the landscape functions is a deterrent. Additionally, the GameFi space at this moment requires some form of financial and data literacy, which many traditional gamers are not accustomed to.
  
• Nascent technology: GameFi requires users to interact with blockchains and use cryptocurrency wallets, which may pose a barrier and intimidate unfamiliar individuals. Web3 presents a new technological sector, and though much improved since its nascence, the User Experience (UX) has still much room for improvement. Finally, there is concern about high transaction fees on blockchain networks, especially during times of high network congestion. These fees can make it costly to participate in GameFi activities such as buying, selling, or trading in-game assets or tokens.
  
• Limited game selection: Though there are several GameFi projects currently on the market, they are both not at the level that traditional gamers are accustomed to and lack variety. Traditional gaming industries have large teams and high funding, which allows them to create high quality games at a faster pace. However, in GameFi, teams are much smaller, and depending on the projects, funding can be less. 
  
• Regulatory uncertainty: The regulatory environment around GameFi is still unclear in many countries, which can create uncertainty and deter potential users.

However, these are addressable barriers that require adequate infrastructure and funding to be solved. 

What is XBorg?

If you are more of a visual person, you may watch XBorg's CEO deliver a flawless explanation here: https://www.youtube.com/watch?v=yqQf0ETfB9w

Having developed a broad picture of the gaming, esports, and GameFi industries, one can now explore what XBorg is and how they are challenging both industries. XBorg leverages blockchain technology to empower players, fans, and enthusiasts, and the first fundamental step is to understand the ecosystem as the sum of two layers, the Gaming Credential Network, and the Gaming Application Network.

Credential Network

The Gaming Credential Network is how XBorg creates the digital identity of players. This network is comprised of NFTs that will represent a player’s gaming data. There are many types of NFTs that are leveraged in order to develop the player’s digital identity. For example, one such NFT is specifically issued for all supported games on the XBorg App, whereby players may access different games and acquire NFTs that will track their performance and build their on-chain CVs as they progress. There are also NFTs that are distributed to communities where players can acquire and demonstrate their commitment and fealty. The credential network is an aggregation of all these compiled NFTs, which represent the identity of players. Similar to the Lens Protocol in SocialFi.

The credential network is broken down into three distinct modules:

1. Player module - aggregates the online activity of the players’, which includes gaming, socials, etc.
2. Game module - tracks the gaming information of players, from both in-game and esports performances and engagement.
3. Community module - collects information about the social engagement of a specific community and its fans. Additionally, there is a reputation system that tracks and visualizes individual players’ accomplishments and behavior that is logged on-chain.  

Application Network

The Gaming Application Network is how XBorg leverages the player’s digital identity to create bespoke user experiences. This unlocks a myriad of opportunities for developers. Here are the current and future products that are and will leverage this credential network:

1. Soulbound launchpad - Players will be able to access investment opportunities based on their in-game data, and developers can target players and communities that show a propensity for interest in their projects. This product’s V1 is live and, since its launch, has kickstarted 6 games, with a total investment of $200,000 in investments. 
   
2. XBorg Engagement App - Players can connect with communities and games they are a fan of. Complete quests and create avatars by earning and equipping wearables offered by various community NFTs. Additionally, communities can create custom experiences for their community members by leveraging the infrastructure, which will be highlighted in a later section. This product is currently in a live Beta for two months and has three games players can access for quests. The platform had 10,000 early sign-ups and is currently demonstrating 1000 weekly active users who collectively shared 4,000 badges across social media platforms. 
   
3. Player earnings tokenization - Players will be able to tokenize their earnings and give access to earnings to fans, and they will be able to share the upside with players. In development.
   
4. Reputation-based lending - As you grow in the ecosystem and earn NFTs, you will develop your reputation. You will be able to pledge your gamer reputation to lend and borrow assets in a liquidity protocol. In development. 

Additionally, a strength of this infrastructure is that it has been built so that developers can create projects on top of the layers as they are completely composable. XBorg aspires to become fully decentralized, offering grants for developers building on top of the credential layer. 

Product Spotlight

Delving deeper into one of XBorg’s products allows us to highlight the above process a bit further. As mentioned, XBorg allows communities to create custom quests and experiences using the App’s infrastructure. The following diagram is an abstract version demonstrating the quest, achievement, and reward processes that were jointly developed with a leading esports organization, Team BDS. This app solves a major gap in the market for esports teams, which is monetization, and creating and retaining engagement among fans.

Earlier, it was discussed that players collect NFTs in the process of developing their digital identity, and the diagram above demonstrates that process in action and how players can collect various wearables that will be joined in developing their gamer and fan identity.

Protocol sustainability and revenues:

Another key consideration is financial viability and sustainability. Below highlights the different fee generation structures built into the ecosystem.

Token utilities

The $XBG token is the utility token of the XBorg and serves as the primary value transfer within the XBorg ecosystem. The token is an ERC-20 token with a total supply of 1 billion that will be deployed to Ethereum and bridged to L2s such as Polygon . As the scale of the network progresses, XBorg intends to become an app chain (Borg chain). The token will have a series of ecosystem utilities that are illustrated in the XBorg Public Deck , but a summary can be found below:

In-app payments and platform fees - Payments and transactions on the protocol will use $XBG, with associated fees. In the use-case where USDC is used to make payments on XBorg-powered apps, XBorg will purchase the equivalent of $XBG on the open market.

Governance - At TGE, the $XBG token will be used for governance actions in the XBorg DAO, giving holders the right to vote on key decisions regarding the development of the protocol.

Staking - Of the fees and revenues paid in XBG, 50% are allocated for the staking reward pool. The amount of staking rewards received is determined by the duration of the lockup period and the individual’s status within the protocol.

Protocol Access - Some functionalities and utilities of the protocol are subject to access restrictions based on the quantity of $XBG held and the user’s status within the protocol.

Gas token - Upon release and traction of the on-chain Gaming Credential Network, XBorg will develop its Borg, a Polygon supernet with $XBG as a gas token. Details about the Borg chain will be shared in the future.

TGE - The $XBG TGE is planned for the end of 2023. Before launching, public fundraising will occur via a Liquidity Bootstrapping Pool (LBP) with a token price of $0.5.

Fundraising

On 03/04/2023, XBorg announced that it is opening its seed round, and Prometheus NFT holders, alongside select SwissBorg users, will have the chance to participate. The raised funds are to be allocated over the course of three years, assisting ecosystem growth and scaling in terms of marketing and the growth of the XBorg team seen below. A more detailed view can be found below:

At the time of writing this article, there are around $4.7 million in soft commitments from the community alone. One can register their interest and receive a more detailed overview with the following link . It can be noted that the seed round is scheduled for the 15th of May.

Final thoughts

By facilitating an ecosystem where players can leverage the data they generate, XBorg permits players to experience the value they generate and revolutionizes the esports and gaming industries. Sitting at the intersection of gaming, esports, and Web3, XBorg has the potential to capture a significant amount of value, and pave the way for a new future for the pillars of this sector, the players. Curious about participating in shaping this future? Follow this link to learn more. XBorg is on a path to onboard the next millions of players and revolutionize gaming applications, at scale. 

Useful links

CEO's pitch
Website
Twitter

Citations

Clement, J. (2022). Topic: Gaming monetization2. Statista. Retrieved March 5, 2023, from https://www.statista.com/topics/3436/gaming-monetization/#topicOverview

Gough, C. (2021). Topic: Esports market. Statista. Retrieved March 5, 2023, from https://www.statista.com/topics/3121/esports-market/#topicOverview

Hirschfield, J. (2022, February 9). The growing importance of microtransactions in digital gaming. PaymentsJournal. Retrieved March 5, 2023, from https://www.paymentsjournal.com/the-growing-importance-of-microtransactions-in-digital-gaming/#:~:text=In%2Dgame%20purchases%E2%80%94sometimes%20known,to%20be%20roughly%20%2433.4%20billion.

Howarth, J. (2023, January 18). How many gamers are there? (New 2023 statistics). Exploding Topics. Retrieved March 5, 2023, from https://explodingtopics.com/blog/number-of-gamers