Crabada Deep Dive
The P2E Crab Game with No Guilds 🦀
Crabada is a dual token P2E game with breedable NFTs similar to Axie Infinity. 3 Crab NFTs are required to play the game to earn utility token TUS (SLP) and governance token CRA (AXS). TUS and CRA are used to breed new Crabs.
The game currently has no gameplay, unlike Axie which is a turn-based card game. That said, Crabada’s metagame is much more sophisticated than Axie’s. In fact, Crabada is all about the metagame and daily game theory decisions. Every day - a Crab team owner can choose from 3 options:
A) Mining | B) Looting | C) Renting Out
The riskiness and ROI of each option changes dynamically based on various inputs, which forces Crab owners to constantly think about the optimal step.
Mining is the core activity - Crabs can be sent to mine TUS (SLP) tokens but there is a probability that they would need to fight against Crabs that might try to loot them. The battle winner is determined by whichever team has the highest Crab stats.
Looting is the secondary activity - Crabs can be sent to loot other Crabs that are mining. Looter Crabs have the advantage of seeing the stats of mining Crabs so they have an asymmetrical information advantage.
Battle & Reinforcements
Reinforcements is where things get interesting and becomes a real chicken game. If you’re a miner who is looted and it is obvious that you’re going to lose because the looter’s stats are higher than yours, you’re given an opportunity to call a reinforcement Crab to join the battle alongside you! If the miner calls a reinforcement, the looter also gets a chance to call a reinforcement. This repeats again so both miner and looter have a chance to call 2 reinforcements. In case a miner calls 2 reinforcements, a random dice is rolled and the miner gets a >7% chance to win the battle regardless of the stats.
Reinforcements can be rented from the rental marketplace at a price determined dynamically by the rental market. A looted miner or a looter must constantly make a decision on whether to hire a reinforcement based on rental cost, probability of winning, battle rewards and time extended. So the participants should assess whether the cost of calling reinforcements is worth the time and money.
This brings us to the third activity - Renting out. Crabs could be rented out on the rental marketplace at a fixed price to be called as reinforcements for battles. Keep in mind that this rental marketplace is not similar to the scholar rental marketplace in Pegaxy and can only be used to rent Crabs during a looting battle. Unlike Axie or Pegaxy, there is no delegation or manager-scholar model in Crabada - thus there are no guilds!
Gameplay Tradeoffs
Mining: There is a 90% probability of getting looted and the miner enters the battle with cards open (transparent stats) so the looter is always one step ahead. There is a high probability of losing a battle against a looter. Mining is a 3.5–4hr activity whereas looting takes 1–3hr depending on how many reinforcements are called during the battle.
Looting: There is not always a free mine that could be looted. One might spend all day trying to find a free mine and not find one. One also needs to compete to be the first looter to get access to loot a free mine. Even if one manages to loot, there is a probability that the loot can be unsuccessful.
Renting Out: There is a possibility that the listed NFT won’t be rented at all or even if it is rented, it could be rented at a price that is lower than what one could have earned by mining or looting. That said, once rented, regardless of the battle outcome, the rental fee is fixed.
Battle Winning Odds
Each Crab team consists of 3 Crabs - each Crab has 6 body parts. The team with the highest stats wins the battle. A Crab team’s stats are a function of a) body part class of a Crab, b) frequency of same body part class of a Crab, c) frequency of same Crab class of a Crab team, d) the opponent’s Crab team class.
So even though one assembles a Crab team consisting of top body part classes with 100% purity, winning odds will still be impacted by the opponent’s Crab team class due to the Pokemon-like game design that allows each class to have strengths and weaknesses over another one.
Gameplay Modes as Sinks
Mining could be considered as a PVE and inflationary activity whereas looting lures Crab teams into a quick profit and causes a PVP activity which is less inflationary. 2 Crab team mining results in 608 TUS minted whereas 1 Crab team getting looted results in 328 TUS minted.
Calling reinforcements could be considered as a deflationary activity. Assuming a battle where 3 Crabs are reinforced → 3 Crab team mining results in 912 TUS minted whereas 1 Crab team getting looted and calling 3 Crabs as reinforcements results in 328 TUS minted minus TUS rental transaction fees.
In an efficient market, whenever there are abnormal profits from one activity, Crab supply should flow there resulting in the ROI getting pressured down until it is more or less equal to ROIs from other activities.
Revenue Channels & TUS
CRA treasury generates revenue from 3 channels:
a) Breeding fees - 92% | b) Marketplace fees - 7% | c) Rental mplace fees - 1%
TUS is also used as the marketplace currency that enables users to trade Crabs on the marketplace, unlike Axie which uses ETH. This creates additional reasons for users to buy or hold TUS. TUS is treated as the main ecosystem currency in Crabada, unlike Axie where SLP is treated as the orphan currency.
CRA Staking & CRAM
For every 50 CRA staked, stakers are rewarded with 1 CRAM per week. CRAM is the 3rd token recently introduced to incentivize CRA users to hodl. Stakers lock CRA tokens for a minimum 21 days. Staking in tokenomics is mainly used to disincentivize token holders from selling.
Crabada took that concept to the next level with CRAM which is an uncapped token whose sole utility is to act as an entry ticket to a weekly lottery that gives away 10 Crabs. CRAMs used to enter the lottery are burnt. Lottery winning odds are entry tickets burnt that week divided by total CRAM supply.
ROI & Sustainability
The current annual ROI from an average Crab team is 12x (30 day payback period). Although this is attractive, this also results in the average Crab team resulting in 350k net TUS inflation per Crab team per year (15x mint:burn ratio per Crab team per year).
Future Plans
Although the leadership’s Web2 gaming experience is limited, they have so far came up with well thought economic & business decision and executed timely on the roadmap. The co-founders are 0xtender and Fuji.
Crabada is soon expected to launch its highly anticipated Axie-like turn-based non-idle game. Here’s the recent trailer:
Crabada is currently on Avalanche’s C-Chain but the team is planning to set up their own subnet on Avalanche called Swimmer Network. A subnet is an Avalanche mini-chain that is interoperable with other Avalanche mini-chains (e.g. DFK chain and C-chain). TUS will be used as the network token and will be used to pay the gas fees — which will then be burnt.
Crabada’s ambitions are beyond just a game — they aim to become the leading gaming hub/subnet on Avalanche - an end goal similar to that of Sky Mavis’ recently hacked Ronin blockchain, Immutable X and Forte.
Conclusion
I haven’t done any investment due diligence on Crabada as I don’t have access to growth-related data. This is not investment advice and just a detailed analysis of the game mechanics. I don’t own any CRA, TUS, CRAM or Crabs. If you want to learn more about blockchain games, you can follow me on Twitter, Substack, Spotify, and YouTube.
