Yield Guild Games ($YGG ) emerged in 2020 amidst the backdrop of NFT gaming and play-to-earn being in a very nascent stage.
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At that time, most of the crypto community viewed blockchain games as a small experiment, with no clear economic model, and no one thought that a 'guild' – something that only existed in MMORPG games – would become a real economic structure operating on capital and incentives.

YGG was born from a simple idea: if blockchain games generate profitable assets, then organizing the ownership and operation of these assets could become a viable business model.

This led to a new model: guild-as-DAO.

Looking back, 2020 was the year YGG chose the right time to experiment.

Axie Infinity began forming a community of players in the Philippines, Indonesia, and some emerging countries, but the initial barriers were quite high: it required capital to buy an Axie team, operational knowledge, and time to understand the meta game.

YGG realized that what players lacked was not blockchain, but capital and guidance.

From there, they created the 'scholarship' model: the DAO buys NFTs, players use them, and both parties share profits.

When I observed this model at that time, I saw it more as a form of 'micro-franchise' in the gaming industry rather than a DAO in the traditional sense.

And it was this model that put YGG on the global map.

In 2021, play-to-earn exploded.

The number of Axie players grew from tens of thousands to millions, with many seeing it as an alternative source of income during the lockdown.

YGG directly benefits from this growth.

They expanded capital, securing a large funding round from a16z, Delphi, and many major funds in the industry.

With new capital, YGG began to expand its portfolio: from Axie to other games like The Sandbox, Illuvium, Star Atlas.

By mid-2021, YGG became one of the most influential DAOs in the gaming sector.

From a builder's perspective, this is an exciting phase: YGG not only owns in-game assets, but they are building an 'intermediary layer' between games and players — a labor market in gaming with operations incentivized by crypto.

However, the play-to-earn model also carries structural risks.

In a short time, the cash flow in games mainly comes from new players, not intrinsic value.

I once worked with an NFT game at that time and realized the problem early: if the yield in the game is higher than the yield in the real economy without real value to offset, then it is an unsustainable model.

This happened with Axie at the end of 2021 – SLP plummeted, the contagion effect caused players to leave en masse.

YGG, which depends on the revenues of these games, is strongly impacted.

This is when many believed the guild model had ended.

But in reality, this is the stage where YGG must transform.

The year 2022 was one of the toughest periods for YGG.

Token prices plummeted, scholarship activities nearly collapsed as most play-to-earn games lost players.

But instead of clinging to the old model, YGG began to restructure.

They shifted from a centralized guild to a 'subDAO' model — each game or community organized into a group with independent operational rights within the ecosystem.

When I studied this structure, I saw it resembled how large DAOs branch out to reduce risk: not allowing the entire model to depend on one industry or one game.

YGG also shifted its focus from play-to-earn to play-to-own and on-chain identity, two directions that have much higher sustainability potential as they do not rely on new influxes to maintain yield.

Also in this phase, YGG began investing in games with deeper economic structures — games that do not solely rely on token inflation.

This is a point I appreciate.

In a conversation with a group of builders who once made NFT games, they said that play-to-earn was initially an economic mistake, and the future belongs to the 'player-owned economy' model: players own real items, but gameplay and intrinsic value are the focus.

YGG caught onto this quite early.

They began building tools to support players: on-chain asset management, productivity tracking, community management, and even skill development support.

The next major turning point for YGG occurs in 2023–2024.

When crypto recovered, the narrative of 'on-chain gaming' and 'crypto-native identity' began to resurface.

But this time it was no longer the old play-to-earn.

Games are deeper, tokenomics are tighter, and in-game assets become reusable assets in various contexts.

YGG returns but in a new form: no longer a guild for players to borrow NFTs, but a platform connecting players, assets, and financial products surrounding gaming.

Notably, YGG is developing the 'YGG Passport', a type of identity for players in the Web3 ecosystem.

From a technical perspective, this is not too new of an idea, but their approach is quite practical: user gaming data is used to determine their level of trust, skill, and contribution in the DAO.

This creates a base layer for behavior-based incentives, rather than relying on farm tokens.

In a project I once participated in, designing behavior-based incentives was a decisive factor for sustainability.

YGG follows similar logic.

Alongside identity, YGG is expanding into financial products surrounding in-game assets.

This is the piece many overlook but is the most important.

As game assets became on-chain assets, they could be staked, used as collateral, involved in secondary markets, or even split into multiple ownership layers.

YGG is building an infrastructure that could serve as an intermediary for all these activities.

This has taken them from a simple guild to a type of 'on-chain gaming economy aggregator'.

If I had to summarize the journey from 2020 to now, I would say YGG has gone through three phases: forming based on the real needs of players, strong growth thanks to the play-to-earn cycle, and then transforming as the old model collapsed.

The most valuable thing is that YGG did not disappear like most other guilds.

They are restructuring, changing models, and preparing for a new wave of on-chain gaming.

From a builder's perspective, this is a rare example of a DAO surviving through the entire market cycle.

The future of YGG depends on two factors: the quality of Web3 games and the ability to integrate on-chain assets into financial products.

If Web3 games become real economies with endogenous cash flows, YGG will return as a hub of that economy.

If not, they still hold a significant position thanks to the identity system and subDAOs.

What is certain is that YGG today is no longer the same as YGG in 2021; they are more mature, more technical, and more sustainable — essential factors for a new gaming cycle.