Road to CHAMPION END: What is going on with Splinterlands Assets and Why
tldr: This is a long post but I suggest you read it if you're invested in Splinterlands. Open to all constructive discussions.
It's funny just a few weeks ago I was drinking the kool-aid. Thought this would be my forever game. Even considered reaching out to the team despite loving my day job. Fast forward and it's armageddon.
I picked a terrible time to enter as a new player and whale around. Terrible moves, crashing card prices (-40%+), and crashing SPS/DEC. Since that time I've done a lot of research and tracked the top whale and internal company accounts. There are a lot of troublesome signs.
A few days ago I wrote a long critical post but ended up deleting it. It wasn't very constructive. I'm trying again here. I suspect this post won't be very popular but I promised to always keep it 100% with you.
Some Background Info
- I'm an analyst in a mid-cap gaming company.
- Also dealt with CCGs, social gaming, and virtual worlds.
- No NFT experience. I buy/hold crypto and have been very fortunate despite not being an expert.
- I've also gambled for most of my career. Losing 5K is not a big event to me.
This is NOT a doom & gloom post or hatchet job.
I'm mostly writing this post to inform people and share my mistakes.
Where Splinterlands is and Where it's Going
All assets in this game have collapsed. SPS and DEC are both trading at 33% of their previous highs in Oct/Nov. Card and rental values have dropped 40%+. Market Cap and DAU are steadily dropping. Honestly it looks like a death spiral.
Pack sales are sluggish. We'll reach the General Sale without coming close to the 2nd Phase allotment. One troubling sign is the HIVE market valuing VOUCHERS, which have a floor price of ~$4, at $2.90. The recent airdrop announcement brought them to ~$3.25. Still nowhere close to their floor value.
This suggests that Chaos Legion packs will have value well below their $4 asking price. The Chaos Legion general sale will bring out an additional 12 million packs to the system. This is a truly absurd total and will 2x-8x the current card pool depending how you look at it.
Further crashes in card prices are inevitable. It's simply not an asset you can trust for the next X months it takes Chaos Legion to sell out. That's anywhere from 3 months to a year of paralysis.
Do NOT buy any cards right now you are lighting money on fire.
Why are we Here?
While I'm still longing SPS, normally I would also buy PLOTS. But I no longer trust the Splinterlands team or the direction of this game. I've put a freeze on all investments.
At almost every key stage of Splinterlands, the team has chosen to take the quick buck for liquid cash infusion. Would not be surprised if the team has cash flow issues.
Key decisions include Land Plots, Chaos Legion, and the Bot problem. The team consistently just takes the money even if it hurts the game or tanks the assets. Why is that? Maybe they need the money.
Recently, on July 29th, SPL raised $3.6 million in a private token sale. This is a very low total for a game purported to be as big as Splinterlands. The game is #1 Dapp and #1 DAU. Topshots raises $250M at a time. You're telling me the #1 NFT game can only get $3.6M?
Same with the token volume for SPS and DEC. DEC is in game so let's just leave it out. But SPS is only trading $2M volume/day? Dozens of games with much less than SPL's player pool are doing 20x, 30x, 50x, 100x this volume. What the hell is going on?
Chaos Legion Aggressive/Borderline Outrageous Print Run was Made for 1 of 2 Reasons
- Milk the community for $4 pack to increase cash flow or even cash out of the game
- Crash all assets so that new player blood will flow in
See the dirty secret of Splinterlands is a massive % of the player pool is propped up by Bots and Multi-Accounts. Did you even know this? I sure as shit didn't. And it sure as hell isn't ever mentioned in all of these marketing campaigns pushing the total DAU or the wonderful community or how fast this game is growing.
Did you know the CEO even endorses bots? That the Discord has a bot channel? That the top Bot runners have made millions of dollars from this game exploiting new players? I would not be surprised if the company owns the bot rings or has an equity share.
Did you know it's rumored that top players in this game both operate lucrative botnets AND multi-enter every tournament with big prizes from Bronze to Champion? Did you know a decent chunk of the top 1% in this game (who own 90% of the assets) actually work for the company?
These are all massive problems for the game. Newcomers like me are being lured into a broken system where bots and whale accounts have made it unwinnable. Devs who actually wanted to build a healthy mainstream game, instead of just collect the quick buck, would have banned all bots once the Splinterlands numbers started rising. What kind of new player will like a game where 80% of the players are whales, bots, or multiaccounts?
The Chaos Legion release is calculated by the company to 1) increase their cashflow at $4/pack and 2) tank all asset prices, probably because they need the new player/fresh blood KPI. They've realized that the bot/whale hegemony isn't working and their growth has stalled. All of this is being masked of course. I've never seen a game where the devs actively conspire to tank their players assets.
In fact I'll go as far to say that you can't trust anything about this game on the surface. The whales (many of who work for the company) control everything and they're manipulating most of the markets.
How do you Profit from this Situation?
Honestly if you don't have much invested I would just leave. The opportunity cost of investing in SPL is high considering you can invest in cryptos that are mooning every day. This asset is tanking and even the copers/shills give timelines of 3-6 months before it recovers (when all the CL packs are sold). Life is short.
If you're like me and trapped with a bunch of illiquid cards and tanked assets, this is what I'm doing. Follow the whales.
Stake/Long SPS if you still Believe
All of the whales in this game have the max (1M SPS) or near the max staked. It makes sense to me that while they're tanking every asset to try to gather more new players, they're holding SPS and watching it grow. I also think SPS has a lot of upside to 10x or greater still. It hasn't really "broken" mainstream. Splinterlands is deceptively propping up their Dapp/DAU numbers but there's still a chance this gets some mainstream/retail upside and easy 10x's or more.
If this game does well, SPS will do well. Same with PLOTS. But PLOTS are much more expensive and I don't trust the team or direction at all.
Do not trust DEC
DEC is pegged so SPL will constantly manipulate it to drive the price down. Lower $ value per DEC benefits the company more as well. When your 2000 DEC is worth $6, you're more likely to buy cards with credits than when your 2000 DEC is worth $12. They also probably want to drip DEC rewards to as wide a group of unique players as possible. Don't trust DEC.
Do not trust any Splinterlands Influencers
Most everyone is shilling or trying to cope. I thought this would be a very friendly community but it's not really (with a few exceptions). Almost all of the Customer Reps and big personalities are working within the machine. I would take everything they say with a huge grain of salt.
Do not buy any cards
With the exception of Dr. Blight possibly. I found a good spot to buy a bunch of Dr. Blight's at $88, well below market. I still passed. I'm not investing anything into this game; I trust nothing. You can try to time the bottom once the general sale happens.
Flaws of the Shills/Copers and What do I think will Happen?
- They're not factoring in opportunity cost. Why would you hold SPL assets for 6 months, unable to buy anything without setting money on fire, when you can invest in crypto? Multiple bags I have are going up while everything here is just dropping hard.
- NFT projects have cyclical hype. The majority have 0 or 1 hype cycle and then it's on to the next cool thing. Why does everyone assume people will come back to Splinterlands? Yeah it blew up once in 2021. That doesn't mean it will again in 2022.
- SPL team has chosen to shit on all of their current asset holders to tank prices, collect the quick $4, and attract new players. Every new player that comes in from now to the bottom will watch their collection values decrease as the glut of Chaos Legion cards depresses the market. Every new player will have a horrible experience due to this. You're already seeing many players quit right now.
The irony of Splinterlands is it's quite a beautiful game without the botting/MA/tanking of assets/overprinting cards. But taking the cynical cash grab was probably the most +ev line and anything goes in crypto right? As for the future, I see this happening in a few ways.
The spiteful side of me wants to see them just burn everything into the ground in their greed to collect $4/pack and keep the bots running. Assuming that the Splinterlands team is part of the whale council and controls the bot rings, do you really want to support this? FWIW I think it's more likely the game recovers than burns. But the % of this happening keeps rising.
If they manage it properly though, I'm betting on SPS doubling at some point. When you see the whales and VC investors start dumping their bags (they're in the rich list on PeakMonsters) or you're happy with the SPS price, you should sell and then just not return. I'm personally hoping for a 5x plus but it will take some time.
I also think Plots will go up if Splinterlands doesn't crash and burn. But I don't trust them enough to invest in this game any more.
Referral Program and Giveaway
I still have to process a few reward card giveaways but I've been pretty lazy about doing that.
I'm giving up my Road to Champion and no longer posting my referral link.
I may continue doing giveaways for my blogs if this one doesn't get me flamed to the ground. Be gentle.
Cards should've never been allowed to appreciate in value like that they did. It was a disaster waiting to happen (for someone.)
The team should've sold more cards and sooner at affordable prices to keep the "for fun" proposition of Splinterlands intact.
They wanted to. They never wanted to have a time period where packs weren't available. They didn't expect a 70x growth in the game or whatever it ended up being. The combination of packs selling out way faster than expected and needing to focus on scaling to simply keep the game working with so many more players meant they didn't get Chaos out when they wanted to.
I 100% agree with this but with general sale around the corner and a good chance of packs selling out in a month or 2. I wonder how long after that were once again going to have no packs on the market. sets are supposed to last a year if these all go by February we could have a 10 month time frame of reward cards and rift watchers rift watchers being all that's available. and hopefully spells from land but that wont effect the numbers of monster's and summoners available.
I inserted in some feedbacks eg. to slow down bots on their feedback channels, which unfortunately get more downvotes then upvotes probably from botters themselves. I never understand why they continue condoning and encouraging botters (which discourages genuine players).
-Cards being cheap is good. New players coming in need cheap cards. Not everyone has thousands in crypto laying around to buy a good set of cards for each splinter
-this is actually a great time to start buying cards, especially sets before chaos legion. Should new players start buying when prices are high? You think card prices will go down when lands become usable?
-the entire NFT market is low right now. This isnt a dip unique to splinterlands.
-I bought SPS the day it was released for 25 cents, so you think id be down on it….. but due to the airdrops and APR (still at 40% apr btw) i have 4x the SPS i initially bought so im up 4x on my investment.
-“SPL raised $3.6 million in a private token sale. This is a very low total for a game purported to be as big as Splinterlands.”
Congratulations youve just realized how undervalued Splinterlands is. This is the most played crypto game and one of the most used DAPPs in all of crypto. If you dont count exchanges like pancakeswap this is the most used DAPP in crypto.
-The devs have incorporated numerous anti-bot measures. All DAPPs can be botted and are botted heavily.
-Calling yourself a newcomer then complaining that card prices are too cheap? Makes no sense to me whatsoever.
-If splinterlands had a marketcap like axie infinities youd be looking at $15-20 SPS with whats currently circulating. Splinterlands has more players and a lower cost of entry.
-i dont understand “I dont trust this game”…. Everything theyve done is transparent and standard things a game company would do, all while creating tons of value for their players. Im sorry you didnt get in a year ago like me, but thats why the chaos legion set had 3x more cards to be released than Untamed, so noobies like you wouldnt need to pay exorbitant prices to play the game competitively. How you spin that into a negative is beyond me.
-do you have any evidence the “team is running the bots”? Or are you just a disgruntled noob who went all in on a bunch of cards weeks ago when prices were high, then saw their collection value go down as the entire crypto space especially NFTs went down….
-The splinterlands player base did a 30x in a couple months and the dev team has 70 members now and youre mad theyre raising money by selling card packs? Just like theyve always done since 2018?
-this entire article is completely off base. I have been investing in crypto games for over 4 years now and after playing hundreds splinterlands is hands down the most quality and entertaining game ive found to date. Its the benchmark for all other games i try to compare to. I bought all my cards in a similar downtrend in the card market and im extremely happy i did because now im making $50-100 a day renting cards all from the cards i bought in 2020. I expect nothing different from chaos legion cards especially as people combine them to level up. The circulating supply will decrease 100 fold for some of these cards. Commons themselves take 500 cards to max the level. Buy those now when theyre pennies. Even when youre not playing the game you can rent the cards for income which is amazing.
You don't sound objective here 😟. But thanks for posting your thoughts in a nice way.
Our personal experience doesn't matter here. Mavericks like to tell stories about how they were early and made good money but it doesn't mean anything for the present or future.
$3.6m valuation is from both the company's internal figures and the investors doing due diligence. This is a pretty rigorous process. Nobody is undervaluing anything.
Devs endorse bots publicly. The founder posted a referral in Discord to the biggest botmaker.
SPL should have more token movement/market cap if the numbers are legitimate.
The main things I want to stress though for anyone reading comments:
This is horrible advice. Even the mavericks admit cards will most likely drop to 3 cents per common.
I wasnt a maverick until chaos legion dropped. If the overall scape of blockchain gaming continues to progress, this game will continue to increase value with it. Lands being released next year will also increase the demand for cards to whole new levels, so theres no real good reason to assume getting in now is bad. Unless the whole of crypto enters another bear market, I dont see people buying now not being able to do the exact same thing I did a year ago.
3.6m generated in the SPS sale is what the team limited itself to. They capped that and sold the exact amount of SPS they said they would at 1.8 cents to those institutions. Institutions inquired about buying more from the other funds they had set aside for things like SPS battle rewards and the team did not oblige. The game is immensely undervalued for the amount of DAU it has. The quality of the product is very high compared to some of these games that dont even have a product yet are valued at 300m (aurory). When I invest in games having a working product is one of the things i look for. I have yet to find a game with so many polished features such as renting your assets and ive played/tried over 100 crypto games.
Devs have stated numerous times that banning bots is a fools errand. They have recently introduced measures to make bots less profitable, like no DEC rewards until bronze 2 is reached. They have repeatedly stated "yeah go ahead and bot, but we will continue to make botting less worthwhile as long as it doesnt compromise the game play for non bot users". Thats hardly an "endorsement".
What numbers are you talking about? DAU? Token release schedule? Circulating supply? We can debate how many of the Daily Active Users are bots, but honestly if you go on the discord most people, including known botters, are of the opinion that its wayyyy less profitable to bot now than it was before. To the point where most people who considered buying bots arent considering it anymore. When i get past bronze league i encounter almost no bots. And to be honest i dont even mind playing bots, its an easy win for me.
"This is horrible advice. Even the mavericks admit cards will most likely drop to 3 cents per common."
So youre in the business of trying to time market bottoms? Your advice to new players is to not play and try to get lucky and time a bottom? Thats not good advice at all. Maybe they will go down to 3 cents, maybe less, maybe not? Its about getting a feel for the long term trajectory of the game, the blockchain gaming market as a whole, and make educated long term decisions based on that. Rent your cards in the meantime and collect crypto on an asset you own. When i buy cards i look for market dips like this and buy low, knowing that in the next year lands will be released and likely need multiple cards assigned per land plot. If the cards drop value in the meantime im reducing my cost basis by renting my assets. Its very nice to be able to collect money from an asset class like this without needing to sell it. This isnt just some NFT that is a picture. Its an NFT that has utility and therefore will have higher than average demand and will be insulated to a degree from market fluctuations when compared to similar assets with no utility.
Bots are in silver 3 now just FYI since I am a low level player. I like bots when they are stupid, but when they are getting smarter it's discouraging I guess to newer players especially if they use powerful cards. I like Chaos Legion because it gives chances to allow new players like me to purchase packs and open them which should be fun, and rent and cards price dropping is also most welcomed.
bots have been in s3 ever since the changes in September. It isn't news, but they are way less profitable (and if you rent stupidly they are a net loss) than they were before the cubed changes. And way more management then they were before the reward chest changes were.
The bots also have good rental snipes, so most are at <10 Dec / day for silver 3, so in that sense they are profitable still. Like I say as long as bot remains stupid fodder, genuine players will be happy. And yes the reward changes for the chests is good against bots.
Hey kauff. Again I want to thank you for having a constructive discussion.
Getting in right now is bad because the cards will tank even further in the General Sale. Plus the value of DEC is much higher than the peg and the founders clearly want to lower it.
Hard disagree here with the SPS sale. The truth is neither of us know but I know how equity deals work and nobody ever limits themselves. I agree the product quality is high (this is why I invested!) but they're hurting themselves.
There are many avenues to reducing the viability of bots. They've explored very few of them historically. I come from an industry with a huge botting problem.
Bots generate infinite money in this economy still. The calculations have been run. So if you don't stop them, the best operations will scale to thousands.
No I'm not in the business of trying to time bottoms. I'm in the business of not buying assets that are guaranteed to depreciate as part of a coordinated money grab from the developers.
Do you want to bet with me if cards will lower during the first X months of the general sale or increase?
2.They did limit themselves. They designed the tokenomics and proportions of SPS that would be used for various purposes before the private sale. These numbers were released before the private sale, so they had to hold themselves to the amount of SPS they publicly stated would be sold to private investors, and they did just that.
3.As with any game, there must be a fine balance with combatting bots without compromising the gameplay for regular players. What they have done in the past 6 months has drastically reduced the bot profitability and incentive to bot.
bots can never be permanently stopped on decentralized applications. its hard enough to stop them on centralized games where you can force people to prove theyre a unique individual. Bots can be disincentivized, and they have been more than ever the past 6 months. go read the discord, many people asking questions about bots, the consensus is that its no longer worth it.
Youre acting like Chaos Legion cards are the only Splinterlands assets that exist. You use the umbrella term "Cards" but you seem to only be referring to the latest set, as the older sets are all sold out. "Coordinated Money Grab" is quite the mischaracterization. Is McDonalds selling me a McChicken for $1 also a "coordinated money grab"? I guess anything a business ever does to make money is a "coordinated money grab". No one is forcing you to buy chaos legion cards. Theres plenty of other cards from older sets. This was alll known before you bought the cards too. They didnt release the packs then say "by the way theres gonna be 15 million packs". Youre literally complaining about a business selling a product that you bought before looking into how many packs would be minted. All that information was publicly available.
Everyone knows chaos legion cards will drop in price in the general sale. No one forced you to buy these and it was all predictable based on the information that was publicly given before the packs were sold. Once again there 80% of the assets in this game dont even fall under the umbrella of things your complaining about because all the packs were already sold.
A lot of what you described is completely normal things to happen to a game like this at a time of a new card set coming out. Especially with how the nft and crypto prices are at right now. The baseless accusations of manipulation and corruption in the team just made you look like you are just mad you bought cards right before rhe new set came out and watched prices fall
Sorry you've had a bad experience here but this is basically unjustified FUD
Which parts do you find baseless? It's mostly all on the blockchain and Discord and part of the public record.
What a complete load of shit…
How do you downvote a post?
This is pathetic uninformed whining on a spectacular scale.
You ought to be grateful someone does not sue you for slagging off like this.
Your professional background with centralised gaming might be more of a hindrance than an advantage here.
A decentralised game can't have gatekeepers. If there's an entity deciding which accounts can/can't play, then that's a centralised game.
That's a good point about gatekeeps and I didn't really think of it like that before your comment. They can still do a lot more to deter bots IMO.
I do acknowledge my professional background can be a hindrance so I share my lack of NFT gaming experience. Enjoy your posts and content.
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