PvP vs PvE - The Daily Gwei #432
It's a dog eat dog world out there.
PvP and PvE - if you’re a gamer you know what these terms mean - but for everyone else: they stand for Player vs Player and Player vs Environment respectively. You may have seen many people in the crypto ecosystem referencing these concepts over the last years or so to describe crypto market conditions so in today’s piece I wanted to dive a bit deeper into it.
So, why is crypto currently a PvP environment? Well, put simply, we are all currently fighting over a pie that just keeps getting smaller because prices are trending down/sideways and most of the ecosystem isn’t growing very much at the moment (with NFTs being the notable exception). So what happens is that with less growth, there’s less money being made, the trading/investing game then becomes harder, and people start turning on each-other (hence the ‘PvP’ concept). You can see this playing out clearly in the markets with the “rotator game” where you’ll have a bunch of the same people on social media promoting a certain trade and then a few weeks later rotating to a different trade. It’s really mostly all the same money sloshing around but the smarter folks continue to take money from the less experienced folks and the pie just keeps getting smaller.
This kind of thing is a big contributing factor to why so many people gave up on playing professional Poker. The tl;dr is that all the pros kept fleecing the noobies which meant it just became pro vs pro and the “easy money” evaporated (and eventually the noobies stopped flowing in). The same dynamic plays out in the crypto markets - the better/more experienced traders/investors are able to make money off the backs of all the new people buying in during bull markets but the new people are making money during this time too so it becomes very PvE (a net good thing). Of course, eventually the new money runs out for a time and then we revert back to a PvP environment where it’s every person for themselves - until the bull market comes back once again.
As you can see, it’s an eb and flow between PvP and PvE depending on what the markets are doing - but it’s not always going to be this way. Eventually, the noobies will stop coming into the crypto markets and the game will firmly be set in as PvP. This will result in the majority of crypto investing becoming “boring” with much less growth than what we’ve experienced over the last 10 or so years. Though this isn’t to say that there won’t be PvE games within crypto - there always will be - but these games will few and far between and they too will eventually turn into being mostly PvP as well.
So what can you do to make your life a little more PvE and a lot less PvP? Well, I think the answer is obvious - build valuable things! Investing/trading is only one part of the crypto ecosystem and honestly I believe it’s one of the least interesting parts. Building things of lasting value that people actually enjoy using brings much more joy and purpose - plus, without the builders, the speculators would have nothing to speculate on!
Have a great day everyone,
Anthony Sassano
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All information presented above is for educational purposes only and should not be taken as investment advice.