By Lawrence Lee, Research Fellow, Mint Ventures
introduction
Web3 games have always been a track that Mint Ventures has been paying close attention to. Although the Play 2 Earn concept brought about by the last round of bull market is no longer mentioned, and at present, Axie and StepN have both collapsed as Ponzi schemes, the millions of daily active users they had at their peak and their extremely sticky data are the first time that the Crypto industry has been so close to "Massive Adoption". Compared with another social product category with the possibility of Massive Adoption, games naturally have a richer and more complex economic ecology, and the team also has more sophisticated regulatory space to collect taxes from multiple angles, superimposed on the experience that the game itself can bring and the irrational consumption based on exquisite design, it is more likely to maintain the relative balance of the ecology for a long time. In addition, web3 games can more effectively utilize the convenient assetization channels that Crypto can bring, which makes investors generally optimistic about the prospects of web3 games.
Since Axie and StepN, web3 games have the following advantages:
Further improvement of infrastructure. Today in 2024, game project owners have more choices in chain selection: whether directly based on existing L1 (such as Solana) or L2 (such as Arbitrum), or using the one-click chain launch service provided by L1 or L2 (such as Avalanche subnet and OP Stack), or freely combining in line with the modular trend, game developers have many high-performance and low-cost options. In terms of wallets, the solutions of MPC and AA wallets are sufficient for commercial use, solving the private key problem that headaches ordinary users.
The market conditions are gradually improving. The recent approval of the BTC ETF has brought about a strong rebound in the overall crypto market, causing Crypto as a whole to begin to attract more attention from the general public. For games, this provides a larger potential user base.
Compared with traditional Web2 games, Web3 games still have very obvious advantages:
In the typical life cycle of web3 games, "NFT sales-FT issuance-game launch", there are many sources of income such as NFT royalties and FT transaction fees before the game is launched, which can help game teams earn income from the first day of game development and offset the long R&D cycle and high R&D costs. At the same time, after the game is launched, the taxation of various links in the game is much more flexible than that of web2 games. Earlier and more diverse commercialization options are the key factors that attract game teams to enter web3.
Web3 games do not have a strong channel player yet, which means that the high volume-buying costs of web2 games do not exist in web3 games. In other words, web3 games are not "competitive", and there is a wilderness waiting for capable teams to explore.
We also see that many experienced game development teams are beginning to enter the web3 game industry. They are building a large number of games with excellent narratives, good experience, and strong playability. The supply side of web3 games has made great progress, which also constitutes the people and resources of web3 games.
For the above reasons, Mint Ventures has been paying attention to the gaming sector. Ultiverse is a gaming project that Mint Ventures has been paying attention to since the previous bear market. They have continued to build in the bear market, continuously enriched their product matrix, and actively expanded the narrative contained in the products. At the same time, they have an excellent investment background and recently launched a number of airdrop activities aimed at attracting new users, which is worth keeping an eye on.
Disclosure: Mint Ventures participated in the Builder Round of the Ultiverse ElectricSheep NFT and still holds ElectricSheep NFTs
Ultiverse Introduction
Ultiverse is a blockchain-based metaverse world that is deeply integrated with AI. Its architecture is divided into 4 layers:
Protocol layer: Ultiverse uses the Bodhi Protocol as the foundation of the entire ecosystem. According to the official website documentation, Bodhi Protocol uses a large language model and a Stable Diffusion model to generate a variety of content within the game, and uses AI to help various stakeholders in the ecosystem, such as helping the game generate smarter NPCs, helping to generate rich background content, etc.
Infrastructure: Ultiverse abstracts a series of infrastructures required for games into SDKs, which can be used by other developers in the future. These infrastructures include MPC wallets and AA wallets, built-in trading markets and DID systems. In addition, its user-oriented live broadcast platform Ultiverse Live has gained 350,000 followers and nearly 40 million likes on Binance live, which can also bring considerable exposure to its partners; Ultiverse's infrastructure also includes its own mission platform Misson Runner.
Core assets: Ultiverse’s core assets currently include Electric Sheep NFT, Meta GF NFT, and World Fragment.
Electric Sheep NFT is the first asset of the Ultiverse ecosystem and also its core asset. There are 7,000 Electric Sheep NFTs, which were minted at a price of 0.5 ETH in July 2022. The current floor price is around 2 ETH, which has brought holders 4 times the return in ETH and 8 times in USD, and also helped build its solid community. Electric Sheep can obtain priority access and reward increase privileges for many projects in the Ultiverse ecosystem, and can receive airdrops of the Ultiverse governance token $ULTC.
Electric Sheep's historical floor price changes
Meta GF NFT will be issued at the end of 2022. It is positioned as an AI companion that supports customized face-pinching and can accompany players in exploring the Ultiverse world.
World Fragment NFT has not yet been issued, and will be airdropped to Electric Sheep holders in the future. According to the official document, players can combine world fragments into worlds, and holding different world NFTs can get different personalized experiences supported by AI in the game, including different storylines, characters, world goals and core conflicts, etc. In other words, holding different NFTs can get completely different game experiences.
Dapp: Dapp is also called "Micro worlds" in the Ultiverse ecosystem. Dapps in the Ultiverse ecosystem can be divided into two categories: one is Dapps that have a cooperative relationship with Ultiverse, such as the casual development game Meta Merge that was launched previously, and the racing game BAC that will be launched on Blast. The relationship between this type of ecological project and Ultiverse is not just a simple traffic diversion cooperation, but a relationship of asset exchange with a higher degree of trust. For example, Meta Merge once airdropped its token $MMM to Electric Sheep holders, and Meta Merge's NFT can also obtain part of the airdrop of the upcoming $ULTC. The other category is Ultiverse's self-developed Dapps, mainly including Ulti-pilot, Terminus, Endless Loop, etc., which were just launched at the end of February.
Terminus was launched in March. It is the core platform of the Ultiverse ecosystem, built with the UE5 engine, and includes PC and VR versions. According to official documents, Terminus is a virtual world. Unlike traditional games, the NPCs in Terminus are driven by highly intelligent AI, which can interact and communicate with players in a multi-path and highly feedback-oriented manner, and may ultimately affect the experience and results of the game. At the same time, characters can also be driven by AI, so even if the player is offline, their characters can continue to evolve, making Terminus an always-online game world.
Terminus screenshots
Ulti-pilot was launched in February and is a portal for users to experience the Ultiverse world. Users can send their own characters to explore the Ultiverse world and receive considerable Soul incentives (which can be used to exchange for governance tokens $ULTC in the future).
Endless Loop is an MMORPG game from Ultiverse, also built with the UE5 engine. The game is not yet online.
From the product architecture, it can be seen that Ultiverse is not just a game. Its goal is to become an AI-driven metaverse platform: on the one hand, it connects with a large number of C-end users, and on the other hand, it connects with various related parties in the web3 industry, and ultimately realizes its Meta-Fi concept.
In terms of the future roadmap, Ultiverse’s main task this year is to fully launch its products, including the PC and VR versions of Terminus, and introduce more game partners. They plan to launch Game Launchpad in the second half of 2024 and launch their own Rollup to better serve game partners and realize their vision of a Web3 game platform.
Investment background and partners
Ultiverse has completed three rounds of financing, with an excellent investment lineup:
On March 18, 2022, Ultiverse completed a $4.5 million seed round of financing at a valuation of $50 million. This round of financing was co-led by Binance Labs and Defiance Capital, with participation from Three Arrows Capital and SkyVision Capital.
On March 25, 2022, Binance Labs invested an additional $5 million in Ultiverse, which will be in the form of an equity acquisition. Nicole Zhang, director of Binance Labs, said that the investment was to ensure that Binance Labs had a say in the future development direction of the Ultiverse team.
On February 14, 2024, Ultiverse completed a strategic round of financing of US$4 million with a valuation of US$150 million, led by IDG Capital, and participated by Animoca Brands, Polygon Ventures, MorningStar Ventures, Taiko, ZetaChain, Manta Network, DWF Ventures, etc. In addition, a series of KOLs in the NFT field also participated in the strategic round, including Dingaling, Grail.eth, Christian2022.eth, 0xSun, etc.
Ultiverse Investors
In general, Ultiverse has an excellent investment background, which includes the industry's top VCs, market makers, exchanges, public chains, and influential KOLs, which can help Ultiverse's development in various aspects.
Frank, the founder of the team, graduated from CMU and is an avid game enthusiast. Currently, the team has more than 200 members. Team members have previously worked in major game companies such as Gameloft, Blizzard, Ubisoft, and Tencent, and have participated in the development and design of well-known games such as Elden Ring, Assassin’s Creed, and Prince of Persia.
Since the goal is to become a platform that connects players and games, Ultiverse has many partners and cooperates extensively with various projects and communities within the gaming ecosystem.
For example, the Terminus finding your path partners event in March was jointly launched by Ultiverse, public chains (Zetachain), other games (Ainchess), infrastructure service providers (Rpggo, Particle Network), game guilds (N9Club, GuildFi), and NFT communities (Weirdo Ghost Gang).
Source: https://twitter.com/UltiverseDAO
In addition, Ultiverse has just announced a partnership with more than 300 web2 and web3 AI and game teams, basically covering all the top web3 games, which will help realize the concept of its gaming platform.
Token Economy
Ultiverse has announced the use cases and economic model of its governance token $ULTC:
In the Ultiverse ecosystem, $ULTC has the following three main functions:
Governance
If Dapp wants to enter the Ultiverse ecosystem, it needs to pay $ULTC, and part of these ULTC will be given to users
$ULTC is the payment method for assets in the Ultiverse ecosystem
The total amount of $ULTC is 10 billion, and its distribution is shown in the following figure:
Source: https://docs.ultiverse.io/ultiverse-tokenomics/token-structure-overview
It is worth noting that 8% of the total tokens will be used for airdrops, which will include holders of Electric Sheep NFT and MetaGF NFT, Soul holders, and holders of other assets in the ecosystem.
The current floor price of Electric Sheep NFT is around 2 ETH, with a total market value of 14,000 ETH, or about 47.6 million US dollars. If we calculate that Electric Sheep NFT can obtain 2% of $ULTC, the corresponding full circulation market value of $ULTC is 2.38 billion US dollars. This full circulation market value is close to the last Game+Ai project Portal launched on Binance, and the valuation is reasonable. Of course, in addition to obtaining $ULTC, Electric Sheep NFT has many other functions in the Ultiverse ecosystem, such as obtaining the World NFT mentioned above.
Soul is the "point" in the current Ultiverse ecosystem, which can be initially obtained by staking Electric Sheep NFT as a reward for early holders. Previously, the team announced that the exchange ratio between Soul and $ULTC was 100:1. After announcing the token economic model, Ultiverse launched several activities to attract new users, hoping to use Soul to further promote Ultiverse's brand. Among them, the Ulti-pilot event that started in late February will release 10 billion Souls (corresponding to 100 million $ULTC, accounting for 1% of the total), which attracted many users to participate.
summary
Ultiverse is a project worth paying attention to for several reasons:
The web3 game track has the right time, right place and right people in this cycle, and is expected to usher in an explosion in the bull market cycle
The Ultiverse team continued to build during the bear market, not only delivering a product with a good experience, but also building a community with good cohesion.
The rapid development of AI in the past year has attracted worldwide attention. Ultiverse has deeply integrated AI in every aspect of its architecture. In the future, when the concept of AI+gaming is valued by the market, it may perform better.
Good investment background