Supervillain Labs Entry into the Web3 Game Market
The Journey after Metapixel dismantling
TL;DR
Supervillain Labs, a Web3 game developer founded by former members of Npixel’s Web3 gaming division Metapixel, is developing an Aptos blockchain-based mobile collectible RPG called 'Supervillain Idle RPG' and a PC MMORPG called 'PROJECT ARK'.
Supervillain Labs differentiates itself by using blockchain for transparency, decentralizing operations, and adopting user-friendly freemium models instead of token issuance.
However, Supervillain Labs faces challenges in effectively utilizing their experience from Metapixel to operate Web3 game services, manage gas fee costs, and attract Web3 users despite not issuing tokens.
1. Introduction
In 2024, the gaming market is experiencing unprecedented dynamism, with numerous companies announcing plans to launch Web3 games. Notably, Supervillain Labs made a significant entry into the Web3 gaming market this February, attracting considerable industry attention. Comprising former members of Npixel, a leading AAA game company in Korea, Supervillain Labs aims to develop Web3 games that prioritize the core enjoyment of gaming. This report explores Supervillain Labs' background and projects the future of their Web3 game developments.
2. Supervillain Labs: The Beginning of their Journey
Supervillain Labs was founded by key members of Metapixel, the Web3 game division of Npixel. To understand Supervillain Labs' journey, it's essential to examine its origins within Npixel.
Npixel, known for its Gran Saga IP, quickly rose to unicorn status in the Korean gaming industry, recognized for its technical prowess and game quality. In November 2022, Npixel announced a partnership with Aptos, marking its formal entry into the Web3 gaming business.
To achieve this, Npixel organized Metapixel, its Web3 game division, and began developing Web3 games using its core IP, Gran Saga. This strategic move aimed to enhance the sustainability of Npixel's successful IP and diversify revenue streams by leveraging Web3 as a new growth engine.
Particularly, Metapixel's Web3-based PC MMORPG, Gran Saga: Unlimited, received significant interest from gamers. In July 2023, over 30,000 gamers applied for the second test, with an average daily playtime exceeding five hours during the test period, indicating high expectations for the game.
However, the extended crypto winter, global economic downturn, and Npixel's increasing deficits led to a sudden reversal of fortune for their Web3 ventures. By 2023, Npixel recorded operating losses of 43.2 billion KRW. Consequently, in September 2023, the operational challenges of Metapixel intensified, resulting in the division's official dissolution.
Despite the dissolution of Metapixel, its core members did not give up. In November 2023, they established a new company, Supervillain Labs, to continue developing Web3 games. Leveraging their experience and skills from Metapixel, they remain committed to achieving success in the Web3 gaming market. This demonstrates their unwavering passion for Web3 games.
3. Web3 Games in Development by Supervillain Labs
Supervillain Labs is currently working on two Web3 game projects. The first is a mobile idle character-collection RPG called "Supervillain Idle RPG." The second, "PROJECT ARK" (working title), is a PC-based MMORPG developed by core members of Gran Saga: Unlimited.
It is unusual for a new Web3 game company to handle such diverse projects simultaneously, as it can be challenging in terms of resource allocation and development efficiency. However, this approach allows them to quickly gain experience and knowledge in the Web3 gaming market. Both games are being developed on the Aptos platform.
3.1. Supervillain Idle RPG
"Supervillain Idle RPG," developed by Supervillain Labs, is a free-to-play mobile game focused on collecting and developing various characters (villains). It aims to be a casual Web3 game that is easy for anyone to enjoy, featuring simple combat mechanics and rapid character growth.
"Supervillain Idle RPG" creates a Web3 inventory automatically upon social login, allowing players to easily manage and transfer game assets through their accounts. Additionally, by utilizing Aptos's Sponsored Transaction feature to cover gas fees, the game enables users to enjoy gameplay with minimal knowledge of blockchain or Web3.
"Supervillain Idle RPG" has generated high expectations even before its release due to active user participation. In February 2024, the community event "Villain Suitability Test" attracted about 60,000 new users. The recent "Supervillain Sidekick Draw" NFT minting event saw the issuance of 83,102 NFTs, reflecting strong user engagement and anticipation. "Supervillain Idle RPG" plans a beta launch in June 2024, with the official mobile version release scheduled for July 2024.
3.2. PROJECT ARK
"PROJECT ARK" is a PC-based MMORPG being developed by core members of Gran Saga: Unlimited. According to Supervillain Labs, while Gran Saga: Unlimited focused on the traditional RPG approach of selecting and growing characters, PROJECT ARK will feature a gameplay style where abilities are determined by the items acquired in-game, and players enhance their skills through practice and experience.
Therefore, the NFT item acquisition mechanism is expected to be a core element of "PROJECT ARK," and the development team is likely to focus heavily on this aspect. Supervillain Labs previously used a "Proof of Play" mechanism in Gran Saga: Unlimited to dynamically adjust the drop rates of rare items. This system operates similarly to Bitcoin's mining difficulty adjustment, where the drop rate is influenced by user-generated in-game data hashed against a target value. If implemented in "PROJECT ARK," it could offer a more dynamic gameplay experience, reinforcing and enhancing the user reward experience.
Currently, no additional details about PROJECT ARK have been revealed beyond the teaser. However, it has been confirmed that the first playable build will be showcased at KBW 2024 in September.
4. Continued Collaboration Between Supervillain Labs and Aptos
It's impressive that Supervillain Labs and Aptos are continuing their collaboration following Metapixel. This ongoing partnership demonstrates the synergy they've developed over time. The choice of mainnet is crucial for Web3 game developers as it directly impacts development efficiency and quality. Supervillain Labs' decision to partner with Aptos again underscores their strong trust in Aptos' technology and support.
The main reason for the continued collaboration between Supervillain Labs and Aptos is likely due to Aptos' extensive technical support. Metapixel, which had relatively little experience with blockchain infrastructure, was able to rapidly develop Web3 games with Aptos' assistance. Aptos provided significant development personnel support, fostering a positive experience that played a major role in Supervillain Labs' decision to maintain their partnership.
Additionally, Metapixel significantly contributed to the development of Aptos' infrastructure. They co-developed technical standards such as the token object model (AIP 22) and the proxy gas fee payment system for Web3 games, fostering a collaborative relationship. As a result, Aptos has invested substantially in Supervillain Labs. This collaboration highlights the importance of trust and technical cooperation between game companies and mainnets.
5. Reasons to Look Forward to Supervillain Labs
Despite its recent launch, Supervillain Labs has quickly garnered significant attention from gamers. This enthusiasm stems from their proven technical expertise and passion for Web3 games, which began with their experience at Npixel. Additionally, Supervillain Labs is setting new directions in the Web3 gaming industry through various innovative strategies. Here are three main reasons why Supervillain Labs is generating high expectations:
5.1. Transparency
First and foremost, Supervillain Labs emphasizes "transparent and fair game management," a critical issue in the gaming industry. The domestic gaming industry is currently facing a serious crisis due to issues with item probability manipulation. Many major companies, including Nexon's MapleStory, Wemade, and Gravity, are under investigation or have been disciplined by the Korean Fair Trade Commission for manipulating paid item probabilities. Gamers are strongly opposing these companies' opaque management practices.
In this context, Supervillain Labs' blockchain-based transparent management approach is attracting significant industry attention. A prime example is the recent "Supervillain Sidekick Draw" NFT minting event, where every process was conducted transparently on-chain. The entire minting process and results were made publicly accessible through a web dashboard, and the trust level for the drop rate of the highest tier, legendary NFTs, was notably high at 99%. This demonstrates the company's commitment to transparency and fairness.
This transparent approach by Supervillain Labs is expected to significantly enhance user trust in the company. By leveraging blockchain technology to ensure fairness and transparency, Supervillain Labs is setting a new standard in game management. This methodology is likely to be a major factor in the company's appeal moving forward.
5.2. Decentralized LiveOps
Supervillain Labs' game and community management approach is also noteworthy. They plan to operate games using a "Decentralized LiveOps" method, which delegates some authority to the community and ecosystem participants. This approach introduces decentralized elements into game operations and establishes community funds to reward ecosystem contributors appropriately, aiming for efficient and fair game management.
Community funds will be sourced from Supervillain Labs' marketing budget, advertising, and other revenues, although specific reward plans have not yet been finalized. However, the operation is already being flexibly managed by the community, with an ongoing process to validate the effectiveness of this strategy.
Most of the Discord community and game event operations are community-driven. Currently, Supervillain Labs' Discord is managed by 12 voluntary multinational moderators who communicate with users and share announcements, ensuring smooth community operations. Event management is also led by the community and influencers, with Supervillain Labs handling only essential missions and reward distribution. For instance, during the "Supervillain Sidekick Draw" NFT minting event, the community and influencers actively promoted the event, increasing interest and participation in Supervillain Labs' projects.
Supervillain Labs plans to delegate more elements to the community in the future. Guilds and creators will be able to host in-game events and propose content, with rewards distributed accordingly. This community-centered approach aims to build a strong fanbase and ensure efficient game management. It fosters diversity and creativity through competitive rewards, creating a dynamic and innovative game ecosystem. However, success will require careful communication with the community, transparency, and a well-structured reward system.
5.3. User-friendly revenue model
Lastly, Supervillain Labs' user-friendly revenue model stands out. Most Web3 games fund operations by selling tokens and NFTs initially, followed by transaction fees within the game, creating a tokenomics-based ecosystem. However, Supervillain Labs does not consider a token-based revenue model, consistent with their approach at Metapixel. Even when they issue NFTs, they do so through free minting during user events, focusing primarily on the core gameplay.
Instead, Supervillain Labs plans to take a different approach from existing Web3 games by utilizing in-game advertising revenue and in-app purchase models that have already been proven in the gaming industry. This can be considered a user-friendly approach, as it enhances the enjoyment of the game through blockchain technology while employing familiar and straightforward monetization models.
Additionally, Supervillain Labs plans to introduce a freemium model in the future. This model, which has been proven to drive the growth of the domestic gaming industry, is expected to involve selling on-chain items within the company's gaming platform. The company intends to avoid forced or unnecessary token issuance and deliberate token burning to maintain the ecosystem.
Supervillain Labs' user-friendly revenue model focuses on enhancing game enjoyment and immersion while building a sustainable business model. This approach positions them with a differentiated strategy in the Web3 gaming market and is expected to provide a more positive experience for users.
6. Challenges Faced by Supervillain Labs
While expectations for Supervillain Labs are high, the challenges they face are also evident.
First is the need for experience in live web3 game operation. While the development experience at Metapixel is a valuable asset, managing an actual live service presents a completely different level of challenge. Unlike when Npixel supported them, Supervillain Labs now has to solve all problems independently, making it crucial to secure operational capabilities. Especially compared to traditional games, Web3 game-specific issues such as blockchain networks and gas fees can add extra burdens during operation. A deep understanding of and response to these issues will be essential for the stable operation of the game. However, Supervillain Labs' strategy of launching games step by step, starting with an Supervillain Idle RPG before progressing to an MMORPG, is expected to mitigate these risks to some extent.
Second is the fixed cost burden related to gas fee support. Unlike other Web3 games that raise initial funds through token issuance, Supervillain Labs must bear this cost without a guaranteed revenue model, posing a financial risk. A simple calculation based on the average daily transaction count of the popular Ronin-based Web3 game "Pixels" and the average gas fee on Aptos reveals a daily expenditure reaching roughly a million won (approximately $730 USD). Therefore, a flexible game design that reduces financial risk without compromising usability is essential.
Finally, the absence of token issuance poses another challenge for user acquisition. Most Web3 games incentivize user influx through token issuance, but Supervillain Labs currently has no plans to issue tokens. This may hinder the attraction of Web3 users and simultaneously fail to draw in Web2 users who are averse to blockchain technology.
However, these challenges can also serve as growth opportunities for Supervillain Labs. Accumulating operational experience and Web3 game-specific know-how while exploring new revenue models will create unique competitive advantages for the company.
7. Conclusion
Supervillain Labs is attracting attention with a strategy that sets them apart from existing Web3 games. Instead of simply issuing tokens through blockchain technology, they focus on the intrinsic value of gaming, which is "fun," and aim to build a community-centric gaming ecosystem. Moreover, their adoption of user-friendly revenue models, such as in-game advertising and the freemium model, reflects their user-centric approach.
Supervillain Labs' active utilization and leveraging of the Aptos ecosystem is noteworthy. They connect their games with other Aptos communities, such as Aptos Monkeys and Aptomingos, while rapidly accelerating game development through technical cooperation with Aptos. It will be worth watching what standards and direction they set for the Web3 gaming industry and what changes their moves can bring to the industry.
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