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Merit Circle, a leading play-to-earn DAO, is marking its first anniversary today. The DAO is celebrating this milestone with several key highlights that show how dominant it has become in this space. The vision for Merit Circle is to expand web3 gaming by incentivizing traditional and new gamers to try its vast portfolio of P2E games. So far, the past 12 months have been quite a success.

Merit Circle: The Beginning

When Merit Circle launched 12 months ago, its primary goal was to become one of the most prominent gaming guilds in the world. However, even though the DAO has achieved this, it has also evolved into an all-inclusive decentralized gaming platform that has opened the world of web3 gaming to many first-time players.

The concept behind Merit Circle is very basic. The community is organized as a Decentralized Autonomous Organization where holders of $MC, the native governance token, get to vote on the direction it takes.

Merit Circle’s primary business model was to initially buy in-game NFTs and lease them out to scholars, who would then generate an income on behalf of the DAO. The organization has also become an important source of investment for P2E games.

Merit Circle
Merit Circle was launched in September 2021 as a gaming guild. Source: Medium

In its initial seed round, the DAO raised $4.5 million in funding from notable names in the P2E space. This underpinned its credibility, and Merit Circle has grown to become one of the most respected names in play-to-earn gaming.

The Scorecard: Key Highlights Over the Last 12 Months

2022 has so far turned out to be a challenging year for the crypto and NFT industry. But despite this, Merit Circle has still managed to report some good highlights as it marks its first anniversary.

For starters, barely a month after its launch, Merit Circle held a unique Liquidity Bootstrapping Pool (LBP) to help the DAO raise money and distribute its native MC token. The event was a huge success.

NFT gaming DAO
Merit Circle raises $105 million in its first LBP on Balancer. Source: Medium

Merit Circle would go on to raise over $105 million. The DAO also sold over 40 million MC tokens in the event which lasted only three days on Balancer. This initial haul of capital has shaped Merit Circle to this day. The money, which is now part of the DAO’s treasury, is used to invest in exciting new games on web3.

Gaming Portfolio and Investments

From the beginning, Merit Circle’s main focus was to develop strong relationships with gaming projects. In fact, even before raising $105 million in the Balancer LPB, the DAO was already pursuing relationships with several NFT games.

In the past 12 months, Merit Circle has expanded its gaming portfolio while gaining a lot of experience on how to find the next big thing in the blockchain gaming industry. The DAO has so far invested in over 70 web3 games.

Merit Circle has also established partnerships with web3 infrastructure providers. This lays the groundwork for the organization to pursue even more ambitious web3 investments in the future.

Four Verticals for Sustainable Growth

For Merit Circle, entering the NFT and web3 gaming space posed several risks. Therefore, the organization decided to diversify its revenues to stay afloat in the ever-changing crypto world. Over the past 12 months, Merit Circle has established four key income verticals that have defined its success so far.

First, the initial idea of scholarship remains a central pillar of the organization. However, the DAO has expanded its catalog of rentable NFTs and continues to find engaging and rewarding P2E opportunities for its expanding user base.

investment in web3 games
Chart showing the portfolio of Merit Circle’s web3 investments. Source: Medium

Secondly, investments in web3 games, through partnerships or equity stakes, are now very common in the DAO. The goal is to maximize the treasury’s value while driving innovation in web3 gaming.

Thirdly, Merit Circle has established Merit Circle Studios. The studios will incubate new projects and provide the infrastructure needed for creative developers to launch new P2E games. Finally, Merit Circle is venturing into NFTs trading.

In fact, the DAO recently launched Sphere, a dedicated NFT marketplace that will focus solely on in-game assets. Sphere will bring NFTs across different games and blockchains. As the web3 gaming industry expands, the organization hopes that Sphere will become the go-to marketplace for P2E gamers.

The Rise of Gaming DAOs and The Future of Merit Circle

Decentralized Autonomous Organizations, or DAOs, are not entirely new things. However, it’s only in 2022 that we have seen the application of DAOs in the P2E and web3 gaming space. A DAO can be defined as a web 3 version of a company structure.

It brings together interested parties to pursue specific blockchain-related interests through smart contracts. Like Merit Circle, gaming DAOs rose from a position of necessity. The main aim was to lower the costs of playing web3 games by renting out NFTs to gamers. Otherwise, these players would not be able to afford these in-game assets at market prices.

The Evolution of Gaming DAOs

The scholarship angle was quite successful, and many DAOs created robust communities of active gamers. But this was not going to be enough. DAOs started to evolve into investment vehicles.

They found ways to pull in the capital, after which the DAO would vote on how to invest it. As such, DAOs like Merit Circle, Yield Guild Games, and others have become essential investment drivers and innovators in web3 gaming.

Many experts have argued that the sustainability of DAOs lies in their ability to offer unique web3 experiences. It’s not just enough to rent out NFTs and provide access to exciting games.

DAOs must also lead in shaping the web3 landscape so that when the industry finally booms, they will be at the heart of it. Based on the model most DAOs have taken, it is clear that this is the grand plan.

Any investment/financial opinions expressed by Play to Earn Diary are not recommendations. Our content is for educational purposes only. If you plan to invest in any game or cryptocurrency then please do your own research and only spend what you can afford to lose.

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