The Life and Death of Pucatrade: Why In-Game Currencies Need to be Replaced by Cryptocurrencies

A World of Imaginary Points

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For anyone that has spent some time playing and learning about the world of Magic: The Gathering, you are probably familiar with the website and trading system Pucatrade. Pucatrade’s value was simple and invaluable to the expensive competitive hobby of Magic - it allowed anyone to trade away their paper (and now digital) assets for in-system points or “Puca Points” that were earned or bought by others.

The benefits of a platform-based currency were tremendous. Here were the main perks -

1- It opened up your trading market from you local store and in-person swaps to a global economy regulated by a universal ‘currency’ system. While before you were limited to whoever you met had what, Pucatrade let you send your assets to anyone in the world and be compensated accordingly.

2- You could regulate unequal values. When trading in person, the goal is to swamp a total number of assets with roughly the same value. This is very difficult when cards can cost anywhere from 10 cents to hundreds or even thousands of dollars. Puca Points were a mediator, allowing you to trade off hundreds of cards with a total of, let’s say, $100 and theoretically receive a single, much rarer $100 card in return.

3- Simple, easy, efficient. Pucatrade was probably the most efficient mediator of trades. The system clearly outlined card conditions, personal collections, a want list, and guidelines for best practices. Points could be easily refunded and no-one was at risk.

Despite all these awesome benefits that players sorely need/needed, from about 2 years ago, the system started to fall apart. This was about the time when the interface was completely redone (of which the poor execution compounded customer infidelity). This ‘in-game’ system failed its original mission and in this post I will look at the major reasons why this point system didn’t work and implicitly outline the main benefits of cryptocurrencies.

The Failings of ‘In-Game’ Currencies

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Pucatrade’s inevitable fate was the cause of a few erosive factors -

No limit on points. The points themselves were not rooted in any real economic system or calculation. While prices of assets were tied to their real-world market value and Puca Points tried to maintain a 10PP = 1USD ratio, there was no limit on how much the company could actually just give out to anyone they wanted. As a result, they began paying article contributors and advertisers in their in-game currency. This caused massive deflation of the point value and cards needed to be manually traded at 10-30% premiums.

• Source: Agent Palmer

No consensus system. As part of the no-limit quality, there was no way to no how and why points were being distributed outside the internal market. Outsiders were receiving thousands of points for external contributions. Consumers had no say and the distribution was left unchecked.

No way to exchange points for anything other than cards. In today’s systems, the purchased asset or point is non-transferrable to anything, even back to fiat itself.

So what happened? Eventually, so many points were generated that it obliterated any balance between supply and demand. People found themselves with many more points than there were cards generally available to the public. It became increasingly difficult to acquire more expensive (>$10) cards and today, the site is little more than a way to peddle off chaff unless you’re willing to trade at a high premium.

Pucatrade is actively trying to rectify the problem now with “point sinks” like lotteries in order to manually “burn” the excess supply of points. But their lack of respect for basic currency economics has already undermined the trust of most consumers and the once thriving internal economy has flattened compared to recent years.

Points are Currencies. Treat them like Currencies.

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Most modern games with a multiplayer base has toyed with point systems in at least some aspect of its gameplay. Much like how you can pay a few bucks to get special abilities in Candy Crush and bypass certain difficult levels, many games today incorporate “micro-transactions” that encourage you to continuously pay fiat for in-game benefits. Some games even have more extensive point systems that let you trade off game material for spendable points.

These systems, like we saw on Pucatrade, create an economy that was a middling alternative to an actual monetary structure. And since they were not treated or understood as such, they were met with either swift economic dissolution or a communal lashing. Micro-transactions in games are universally despised by adult gamers as any monetary investment is non-redeemable.

There is at least one solution to this and with no surprise, it is crypto. In a future post, I’ll look into the WAX token and why it’s tremendously promising in disrupting the world of game economies.