Yield Guild Games Southeast Asia (YGG SEA) Review- YGG’s First Regional SubDAO

At the Coin Bureau, we love great crypto projects and cannot get enough of them. As someone who eats, sleeps and breathes crypto, I often think that I’ve just about seen it all in this crazy crypto world, but then a project comes along from time to time that really excites the team and me.

Just like our readers, we too have our favourite projects that we follow quite closely. Blockchain gaming, specifically gaming guilds, is one of those niches that pique our interest.

We’ve covered Yield Guild Games in the past as a project that we are bullish on; you can find out more about that in our Yield Guild Games review. In addition, there has been an interesting expansion and addition to the YGG ecosystem in the form of setting up a regional subDAO in Southeast Asia, which is what we will be covering here today.

This article will cover a bit about YGG and their decision to expand, what this means for YGG, and go over the nuts and bolts of what you need to know about Yield Guild Games Southeast Asia (YGG SEA).

If you are coming across gaming guilds for the first time, be sure to check out Guy’s video on why Crypto Gaming Guilds might be The Next Best GameFi Play.

Disclaimer: The Coin Bureau has participated in YGG’s SEA strategic fundraising round.

Introducing YGG SEA

Yield Guild Games is the biggest gaming guild in the blockchain gaming world, focused on blockchain Play-to-Earn (P2E) games. It is a community that invests in NFT assets needed for participation in games and lends them out to those unable to or who do not want to purchase the NFTs themselves that are required to unlock gaming worlds and features.

YGG connects blockchain gamers and investors around the world. Their goal is to build a network of players and investors who can help each other get started and thrive in the NFT gaming space, providing a mutually beneficial relationship for all participants.

Following the success of their global launch and meteoric rise in adoption and popularity, they decided to focus on the expansion and operations into Southeast Asia in November 2021. Since then, they have launched locations in Vietnam, Malaysia, Thailand, and Indonesia, forming the Southeast Asia (SEA) subDAO.

This new venture is part of YGG's goal of creating an extensive and sustainable Play-to-Earn economy focused on Southeast Asia; YGG SEA is the first regional subDAO of YGG with more planned to roll out. YGG SEA's mission is to invest locally and grow locally within the Southeast Asian community, building on the amazing work done by YGG in previous P2E markets in countries like the Philippines.

The YGG SEA DAO is a guild "for the people, by the people," located in the region. YGG SEA is participating in over 30 games, including popular blockchain games Axie Infinity, Starsharks, Wasted Lands, Wonderhero and more.

Here is a look at YGG SEA's current Game Partners:

Some pretty exciting looking titles, for sure. The team will undoubtedly be expanding this lineup in the future as well.

YGG SEA’s Vision

As a subDAO, YGG SEA will be specialized and localized in the Southeast Asian economy that forms part of the larger YGG economy. The subDAO has the ability for the community to grow their stake in the YGG DAO over time, giving members the chance to run an organization within an organization.

The YGG SEA SubDAO is in complete control of its operations in terms of engaging with games and acquiring NFTs to suit the local community while remaining an active contributor to YGG and participating in the YGG community.

Blockchain gaming has become a massive phenomenon that has made a huge impact across the crypto, NFT, and gaming sectors and had a mountainous influence on the broader economic global landscape. If you want to learn more about just how big of an impact, I explore this topic further and crunch some numbers in my article about the Future of Blockchain Gaming if you would like to dive deeper.

Here is a look at how P2E gaming dominance looks by country on a global scale according to DappRadar:

YGG SEA aims to broaden access and provide localized support throughout SEA. As the region is quickly developing and showing a keen interest in technology and gaming, it is the ideal market that is on the doorstep of entering the metaverse in a major way. YGG SEA wants to ensure that blockchain gaming opportunities are open to all participants, regardless of income, status, location, or background.

There are already over 166,000 badge holders in YGG SEA’s community, including more than 4400 scholars, who have shared in nearly 70% of the revenue to date.

YGG SEA Gaming Guild Features

The barrier to entry for blockchain and Play-to-Earn games can be quite steep, with the initial NFTs needed to get started often costing hundreds or thousands of dollars. As a result, many interested gamers do not have the means to get involved, and more casual gamers may not be willing to put up the capital.

Through YGG and their YGG SEA subDAO, players can rent the gaming NFTs they need to unlock games and features and keep a portion of their in-game winnings. At the same time, the DAO also receives a percentage for the lent out NFT asset, benefiting both investors and players. Here are some of the services and features of the gaming guild.

• NFT asset and treasury management- Through their relationship with YGG, YGG SEA has the largest network of P2E games that the SEA community are keen to play. YGG SEA has access to some of the best assets for the most in-demand games.
• Incubation and Investment- By incubating and investing in projects, this unlocks narratives and opportunities for gamers, storytellers, developers, innovators and entrepreneurs who are locals in the region. This also provides gamers opportunities to discover local mythologies and folklore by allowing companies to develop titles in regional languages with regional experience.
• Diversification of Opportunities- YGG SEA has already secured stakes in many new P2E titles that will entice gamers of all interests. This can support the largest and most inclusive group of gamers across the region.
• Onboarding- By localizing team support for each country, YGG SEA can help onboard more players around the world and provide local support.
• Creditworthiness & Mobility- YGG SEA will focus on how it can better represent the community's needs through local partnerships. This will allow initiatives and reputations to form and flourish, contributing to real-world financial stability and economic strength.

Why Southeast Asia?

Southeast Asia is home to over 700 million people ready to be onboarded into the metaverse. Blockchain gaming has become massively popular in Southeast Asia. The region is known for its lack of employment opportunities and often low wages. Play-to-Earn games have become widely adopted by many, as people realize that they can earn a better income through P2E games than in the local job market.

The Southeast Asian nations are classified as lower to middle income. As such, most nations have sufficient infrastructure to ensure a high level of internet availability. At the same time, much of the population remains unbanked.

Southeast Asia is a leader in P2E adoption. YGG SEA believes that combining their platform solutions will allow them to optimize access by working with those who have a deep understanding of the home market’s growth ability and economy. Having local insight and experience is key to capturing first-mover advantage in the region while building something sustainable and suitable for the area. There is potentially unlimited upside for the millions of lives that can be impacted by this growing movement.

It is well known that Southeast Asia is one of the fastest-growing markets for blockchain adoption. As a result, play-to-Earn gaming has become the onboarding mechanism of choice for many emerging nations.

The P2E gaming industry has grown to over $40 billion during the pandemic, partially due to massive populations in SEA seeking a form of income in non-traditional ways. According to an article from DappRadar, P2E gaming is one of the most searched and discussed topics in Asia, growing 33% month over month while reaching 1.7 million mentions across Asian media outlets.

In fact, six out of the top ten countries driving P2E traffic come from Asia, with four from Southeast Asia specifically.

That's a pretty telling trend, no doubt. One thing I find interesting about crypto trends is that they seem to span across countries and communities, seemingly independent of status or background. For example, what do Portugal's Madeira, the Central African Republic, and El Salvador have in common? Not much other than they all adopted Bitcoin as legal tender.

Looking at the trend above, I cannot think of any metric outside of crypto where Indonesia holds the number one spot and the United States has the number two spot. Look at how the UK and Vietnam are side-by-side; I love it. Crypto is for everyone, and the more these trends play out with signs of global inclusivity, the better.

Invest Locally and Grow Locally

The YGG model has seen incredible success and growth in the Philippines, positively impacting the lives of millions of gamers. YGG SEA aims to expand on that success and bring those life-changing opportunities to the Southeast Asian region.

The SEA region has enormous potential. The way YGG SEA is going to tap into this market is by investing locally and growing locally within the community. YGG SEA has a dedicated team in place, including executives, country managers, and community teams who have experience in each of the key markets, which are Malaysia, Indonesia, Vietnam, Thailand, and Singapore.

Here is a look at global blockchain traffic in 2021 according to DappRadar:

It is pretty interesting to see that the traffic from the Southeast Asian region is on par with those countries around the world with higher populations.

YGG SEA will achieve localization to further the growth of the P2E scholarship model in 3 key ways:

• Localizing Gaming Communities- YGG SEA emphasizes dedicating vast amounts of time and effort to localizing gaming communities. This includes supporting and engaging with multiple languages, multiple eSports teams, and other gaming communities to ensure adequate representation from all members of the YGG SEA community.
• Localizing Operations- Having localized operations can effectively expedite growth and sustainability in the region. Working with locals with “boots on the ground” experience is key to understanding what is needed in the area. YGG SEA will deliver local operations such as country-specific user acquisition, retention tactics, and growing the YGG SEA presence through local partnerships.
• Localizing Social Impact Efforts- YGG SEA Intends to fully leverage local expertise and networks to effectively address the needs and expectations of local players, taking into consideration the regulations and challenges that are unique to each region. Grassroots community and financial literacy programs are just a couple of the planned roll-outs by YGG SEA.

Demographics

Southeast Asia is defined as 11 countries as per ASEAN: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Timor Leste, Thailand, and Vietnam. The region is home to over 700 million people, speaking 11 recognized languages within the defined region and up to 700 local languages with at least 12 religions.

The median age is 30.2 years old, and the nominal GDP per capita is an average of $4,849 per year, with Cambodia coming in as low as $1,720 per year. According to the Asian Development Bank, the region has forecasted growth of 3.1% in 2022.

9.5% of the population lives below the UN’s official poverty line of $1.90 per day. Timor and Laos have the highest incidences with 21.03% and 9.35%, respectively.

The age group taking the highest level of interest in blockchain globally are users between 25-34, followed closely by under 25’s and a surprisingly steep drop off for over 35.

With regards to crypto and gaming:

• Over 50% of Axie Infinity’s daily traffic comes from Southeast Asia.
• With over 21 million monthly active users, MetaMask cites the Philippines (1), Vietnam (3), Indonesia (9) and Thailand (10) as the leading countries of origin for transactions.
• More than 82% of Southeast Asia’s urban online population are classified as gamers, with 80% of the total gaming audience online being mobile game players.

Thailand and Malaysia have the second and third largest percentage of internet users who own NFTs after the Philippines, at 27% and 24%, respectively. According to a report from Coursera, both Thailand and Indonesia rank higher than the Philippines in terms of technological skills, showing that there is still massive potential to further blockchain gaming and Web3 activity in the region.

Relationship between YGG and YGG SEA

YGG SEA has a symbiotic relationship with YGG, which is one of their key competitive advantages. With YGG SEA forming stronger local partnerships, increasing local user acquisition, and deploying retention strategies, YGG SEA will contribute to the broader YGG ecosystem as its presence grows.

This will place both YGG and YGG SEA in a stronger position in the industry while optimizing asset allocation and rewards for scholars, providing on and off-ramp support to help users convert crypto to fiat more efficiently, and providing greater regulatory representation.

YGG SEA Rewards Program

The participation and support from the YGG community is essential to the expansion of the DAO. YGG SEA is going to incentivize community participation with specially designed reward structures.

Those who act early will be eligible for special Legendary buffs that will only be available to obtain after the SEA token launch on Copper. Legendary buffs will have long-term value for the owner by giving them access to the full range of games that YGG SEA partners with as long as they maintain their status.

The long-term reward structure for YGG SEA is divided into Community Rewards and Liquidity Rewards. This dual rewards system allows for the incentivization of greater community participation while also rewarding liquidity providers. There will also, of course, be staking rewards for SEA token holders.

25% of SEA tokens have been reserved for Community Rewards, which will drive guild growth. This will reward users who join the YGG SEA guilds and guilds for onboarding new members. Aside from onboarding, upskilling players who deepen their engagement with YGG SEA will also be rewarded if they participate in things like gaming tournaments and events.

YGG SEA players will also be incentivized with rewards to try new games and become early participants. Lastly, participation in the DAO will be encouraged through activities like bounty programs and rewards schemes for active participation in the DAO

10% of the total YGG SEA token allocation will be reserved for Liquidity Rewards. This will incentivize the community to perform yield-farming within the ecosystem. The YGG SEA team has specifically formulated a range of rewards to ensure contributors at all levels will receive benefits from participating in the launch.

YGG SEA is offering rewards for users participating in single-sided staking and for users who provide liquidity on Uniswap. A YGG SEA staking interface will be created for users to claim the rewards. Whether users choose single-sided staking or staking Uniswap LP tokens, the YGG SEA staking interface allows users to stake the tokens through either flexible or locked options.

Apart from earning staking rewards in YGG SEA tokens, there will be additional benefits from their Play-to-Earn gaming partners. When users stake SEA tokens, users will not just earn SEA tokens but will also earn a basket of other Play-to-Earn tokens, diversifying the rewards that the community can benefit from while providing additional exposure to the space.

Tokenomics and Governance

The SEA token allocation of 1 billion has been designed to balance community involvement, upfront development requirements, and the long-term stability of the DAO. As the governance token of YGG SEA, $SEA gives community members the right to vote on governance proposals, ecosystem rewards allocations and desired features and reward models, as well as whitelist opportunities for NFTs.

The breakdown of token distribution is as follows:

• 7.5% (75,000,000) will be allocated to the public sale.
• 25% (250,000,000) will be allocated to the community of YGG SEA guild members through various reward programs over a period of 5 years. These programs will be rolled out to support onboarding, gameplay, and community participation.
• 10% (100,000,000) will be rolled out for liquidity rewards. This will be done to promote the SEA token in the market, allowing users to use the tokens for liquidity rewards on the YGG DeFi Studio. These rewards will be split between single-sided staking rewards and rewarding liquidity providers on DEXs like Uniswap. Important note that in addition to these rewards being distributed linearly over five years, all SEA token rewards will vest 52 weeks after distribution.
• 12% (120,000,000) will be allocated to the DAO treasury. The treasury will hold these tokens with no lockup period and no vesting conditions. These tokens will be held for future use including token swaps and acquisition of future assets.
• 23% (230,000,000) will go to the team and advisors. Members of the founding team and core team will have a 2 year lockup period, after which the SEA tokens vest linearly for a further 3 years. The advisory panel will have a 1-year lockup and then be subject to a linearly vesting schedule for the next 1 year.
• 10% (100,000,000) go towards seed/private purchasers. Seed and private investors will have 5% of their allocation released at the network launch and 95% of their tokens will be locked for a 2-year period, after which the SEA tokens will vest linearly for 2 years.

The token distribution looks quite healthy with the majority of the funds going to the community, treasury, public, and held for rewards. The healthy distribution and enforcement of a strict vesting schedule for early investors will help ensure the SEA token is unlikely to experience sudden and intense sell pressure and should assist in helping the SEA token achieve price appreciation over time.

The total allocation of 1 billion SEA tokens will enter into circulation over a 6-year period. It is important to note that the final token distribution schedule of community rewards may be altered by vote of the DAO.

Here is a look at the YGG SEA token release lifecycle:

How to Get the YGG SEA Token

YGG SEA has announced the initial DEX Offering (IDO) of its $SEA token will begin on May 9th, 2022, at 11 am EST and it will run until May 14th on the Copper launchpad.

The IDO will offer community members the opportunity to stake a total of 75 million tokens, representing 7.5% of the total supply of one billion tokens. The starting price is set at $0.50.

The Token Launch Auction (TLA) on Copper allows for real-time price discovery, open and permission-less participation and fair distribution of tokens. YGG SEA Co-founder Irene Umar had this to say about the Token Launch:

“The IDO is a once-in-a-lifetime opportunity to appreciate our community’s unconditional support. We are where we are because of the community and we would like the community to own a piece of YGG SEA through the IDO. DYOR, all I can say: what you see today is just the beginning of what will unfold in the coming months.”

Here are the key details for the launch:

• URL: yggsea.io / yggsea.vault.inc
• Launch (Time and Date): Monday, May 9, 2022. 10:00 p.m. Bangkok / 11:00 a.m. EST / 3:00 p.m. GMT
• Duration: 120 hours (5 days)
• End (Time and Date): Saturday, May 14, 2022. 10:00 p.m. Bangkok / 11:00 a.m. EST / 3:00 p.m. GMT
• Starting Price: $0.50 USD
• Starting Pools: 75,000,000 SEA : $2,000,000 USDC
• Starting Pool Ratio: 95:05 (SEA:USDC)
• Ending Pool Ratio: 50:50 (SEA:USDC)

What you need to participate:

• ERC-20 compatible wallet (Copper is designed to use MetaMask, WalletConnect, Gnosis Safe and Ledger)
• Sufficient USDC to purchase your desired number of SEA tokens
• ETH for gas fees for two transactions (approval and transaction)

You can find the full token launch details and “how-to” guide on the YGG SEA Medium page.

After the token launch auction, look for the SEA token on Decentralized Exchanges.

Team

The YGG SEA core team is made up of industry veterans with gaming, crypto, economics and traditional financial backgrounds who are on a mission to foster crypto inclusivity in the SEA region.

CEO - Evan Spytma

Evan is a veteran in the video game industry, enjoying a career that spanned over 20 years and held top executive positions within Unity Technologies, Electronic Arts, and PopCap games. He is the mastermind behind driving key strategy components and pushing the industry in Southeast Asia to ensure further success.

Co-Founder and Indonesia Country Manager - Irene Umar

Irene started her career in corporate finance and banking, working in Indonesia, UAE, India, and Singapore. Irene left corporate finance in 2016 to jump into the world of gaming when she started the first gaming VC in the region, focused on investing in companies within the gaming ecosystem in Southeast Asia and beyond.

Head of Investments - Dan Wang

Dan graduated from Princeton University with a degree in economics, which likely means he is one smart cookie. Princeton University acceptance is no small feat, and have you ever tried to read an economics textbook? To me, it makes about as much sense as trying to eat soup with a fork.

Dan is also an angel investor with a focus on sustainability and entertainment and is a venture partner at Infinity Ventures Crypto (IVC). Dan has held international leadership roles in the Finance and Tech industries before getting into gaming in 2013. He joined Riot Games and first led international publishing, then infrastructure and global expansion teams before heading up operations.

You can find out more information about the team from YGG SEA’s Whitepaper.

YGG SEA Backers and Partners

Thanks to their relationship with gaming guild giant YGG, there is no shortage of backers and supporters for YGG SEA. Since forming in November of 2020, YGG has secured support from the likes of Delphi Digital, Bitkraft, and 16z, making YGG one of the first Asian investments in the latest Andreessen Horowitz Crypto fund.

Then of course there are also the likes of Animoca Brands, Crypto.com, Poloniex, Polygon, and OKX Blockchain Ventures to name a few. Here is a look at the all-star line-up of some of the investors behind the project:

Yup, a lot of big names and backers behind this expansion project. With the success of the initial YGG, it is easy to understand why.

Closing Thoughts

Yield Guild Games have created a phenomenon in the Play-to-Earn gaming space and have opened up opportunities for global participation in NFT and blockchain gaming that otherwise would not have been accessible to millions of players worldwide.

I don’t know if anyone was truly prepared for, or expected the sudden and massive growth experienced by YGG in such a short amount of time; it is truly awe-inspiring to see how the team has evolved and what they have accomplished. As YGG has become a massive global entity, I feel like the creation of a regional subDAO like YGG SEA was a brilliant move that just makes sense as it will provide local and specialized experience that can only be achieved by those with in-depth local experience.

There is an interesting history if you want to check it out about the colossal failure of the first Starbucks coffee shop that attempted to open in China in 1999. The critical failure on their part was not doing their research and understanding the traditions, wants, and needs of the local demographic. The Starbucks corporation had assumed that just because Starbucks was loved by many in the west, that it would be welcomed with open arms in the Chinese market.

Instead of deploying a local team or seeking advisory services to understand the local market in more depth, their assumptions and likely overconfidence led to the brand’s initial failure and financial losses for the first 9 years of operations in the region. Many investors felt that hiring an American manager to manage Chinese operations was probably the first mistake, and it was noted after the failure that most of the local population had no idea what a cappuccino was, and most of the locals had preferred tea for hundreds of years.

What YGG is doing by creating a local subDAO makes the organization more manageable as a whole, and is allowing flexibility and an understanding in the local area, not making the same mistake as Starbucks who tried to pound a square peg into a round hole. Not only is this better for the organization, but the local Southeast Asian population of users as now there is an opportunity for the DAO to create storylines, games, and provide rewards that are desired by the people in that area.

We all like to interact with things that we are familiar with, look no further than simple video game sales themselves. FIFA video games are massive sellers in Europe, but not many North Americans play video games about Football (Soccer), conversely, NFL and Ice Hockey games sell well in North America but sell very poorly in Asian countries.

Providing an opportunity to locally manage a DAO, network with local businesses and entrepreneurs, and build a community by locals, for locals, while separating operations to manageable levels, will help ensure a better experience and likely a higher level of success for everyone involved. I am very eager to follow closely and see how else YGG is going to expand their global presence.

Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.