Why Aussie YouTuber Scoriox is backing Illuvium to dominate GameFi, even in a bear market

The developing, Sydney-founded GameFi project Illuvium has plenty of fans in the crypto industry, and Aussie YouTuber Scoriox (aka Jason) is one of its biggest. Stockhead caught up with him to learn why.

Hi Scoriox. First things first, what’s the origin of that alias of yours?

It’s my favourite Illuvial [the NFT-based battling creatures within the Illuvium game]. When I was starting my channel I was asking Aaron [Warwick – one of the game’s co-founding brothers] for advice on what sort of names I could go with. He suggested Scoriox and it suited the themes I like, and so here we are.

Cool. How about a bit of brief background, and why you began your channel…

Sure, so I’m a graphic and industrial and UI designer by trade in my day job working in Melbourne. I love design and I’ve got a very iterative background and process – at uni we used to do a lot of presentations explaining complex scenarios and models.

And just over time, I got better at my public speaking or better at talking to people about everything about my own designs, my own work, trying to sell myself as well as the ideas I’m trying to convey. That was all really interesting to me in terms of the YouTube channel.

When did you become interested in crypto?

I got into crypto investing in about November 2020, but I was interested before that. My honours project at university in 2019 was based around blockchain technology and NFTs, before they were really much of a thing. But I’m really into collectibles. I believe collectibles and authenticity go hand in hand, and the blockchain was just an obvious step from that.

And so from there, I got into crypto. And I got into GameFi not because it became a big thing but because when I saw NFTs, it was the first thing I thought of. I think NFTs and GameFi is a no brainer. And I think Illuvium is doing the best job of that at the moment.

Aussie YouTuber Scoriox. (Image suppiled)

Why Illuvium?

Okay, so let’s talk Illuvium. Why are you making it the main focus for your channel?

Firstly, I believe in the founding team. I’m investing in the team but I also believe in what they’re building. I think in the terms of the metaverse and things like that, Illuvium is 20 times ahead of the curve. It’s going to release way before anything else of this calibre.

And I also really like the project’s tokenomics. Just a brief glance at the Illuvium whitepaper will tell you they’ve thought it through from start to end as much as they possibly can. Maybe it will work, maybe it won’t, but at least they’re trying to make it sustainable and work long term, which a lot of other metaverse projects simply aren’t, and a lot of other tokens aren’t.

What about the auto-battler RPG style of the game itself? Is that something you’re into as well?

Yeah, definitely. I’ve been a big Pokémon fan for a long time. That’s not necessarily what attracted me so much, but I think if you build something with collectibles, and it’s compelling and story driven, then I think you have something really addictive on your hands.

The other side of it is that I think for a game like this to be successful, it does need to go relatively viral at some point. Blockchain and metaverse obviously has a lot of influence in the media at the moment. So they’ve already got that side of it. But you also need a strong, competitive game. And I believe what they’re doing with the auto battle and the way it mixes things like Hearthstone, Pokémon and Teamfight Tactics. I think it has the ability to become a strong, competitive game, and therefore have a really competitive scene.

Esports prize pool record

What other factors do you think will make it a hot contender for the most successful crypto game?

Well they’re going out of their way to break the esports record for prize pool and prize money. And I know some people brush that off. But really, I think that has potential to grab mainstream attention. If they can grab an audience through mainstream media, I think it could be really, really good.

Another thing is, anything multiplayer will have a much longer life than single-player games, and I think they’re achieving that quite well with a lot of their facets to the game.

How much is that prize pool?

About US$70 million. I think they have to break Dota’s record, which is about US$40 million. But it might be higher. So we might even be looking at a $100 million prize pool – they’re going break it either way.

Impressive – where’s that funding coming from?

They have a special Treasury set up for these things. It has one million ILV tokens (currently US$505 per token), which they can pretty much use and spend how they want on marketing or whatever else. And I believe the Treasury also receives the game’s revenue distribution. So it will also be topped up a lot as the game is played.

Do you think Illuvium can usurp Axie Infinity and other recently popular play-to-earn games such as Pegaxy?

Oh, yeah, it’ll beat all of them instantly – it’s already got those crowds looking at it. And it has the advantage of looking at a lot of those games showing their hands now, and to see why they don’t work. For example, Axie Infinity disabled certain features on their marketplace recently, because they just weren’t sustainable. They knew it. So all these people are seeing the bad things with Axie and they’re looking for other games to play.

If Illuvium helps them earn, they’ll enter. Then if Illuvium helps them keep earning, they’ll stay. I think it’ll be way above them. But there are other games being developed – down the road Illuvium will have competition.

In-game earnings

What do you think might be some realistic daily-earning figures from, say, an entry-level investment in this game?

I think a lot of my figures look a lot more at the passive staking side rather than the in-game earnings, which is really speculative and a bit hard to predict. But I do think in the early days of the game, it could be really lucrative.

If you have something like a US$20-$30 gameplay loop where you’re catching three or four Illuvials that you could sell, I think a lot of people are going to be selling them for a lot of money, especially early on.

Free-to-play players are going to be able to benefit from this a lot – you’ll be able to go in and capture NFTs for free – there will be a lot of demand for that at the start.

So coming in as a free player, you could earn decent numbers. It’s really hard to pull out of thin air but I’d guess at least maybe $20 USD for every hour that you’re playing. In those early days, I think that’s very possible. Then with a small investment, you can bump it up a bit, enabling you to catch rarer things that sell for more. Luck plays a part in that, too.

Cool, I appreciate it’s hard to predict – especially as it’s difficult to know how the entire crypto market will be faring when the game is launched…

Absolutely. But my favourite part of the game’s tokenomics system is that there’s no major incentive to sell ILV. A lot of your money coming into the game and the money leaving the game is actually Ethereum, which no other GameFi system has really done yet. Zed Run has done it okay. But they had some other problems that have inflated their game a little bit. But Ethereum is entering and Ethereum is exiting. There’s barely any reason to sell your ILV, and I think that’s incredible.

Can you explain that a bit more? The earning Ethereum part?

The main earning mechanic will be selling the Illuvial NFTs and they’ll be sold for Ethereum – bought on the marketplace for ETH and sold on the marketplace for ETH. And the small transaction fee in the middle gets turned into ILV and given to stakers. That’s amazing. So basically how I see it is Ethereum is getting cannibalised to pump up the ILV token just through the game mechanics.

There are different ways to play and earn within the game, aren’t there?

Yeah, they also have the Survival mode in which you earn ILV rewards just for playing the PvE [player vs environment]. And that’s going to be a bit more about an initial investment, but you could probably look at about a 10 per cent return every couple of days. I predict in the early days of the game you’ll have maybe a 15 day ROI on your initial investment when doing the Survival.

How does that Survival mode affect the ILV-token supply?

There aren’t that many tokens attributed to the Survival mode – I believe it’s something like 800,000 tokens over a three-year period. So that’s barely any of the supply. Besides that, there’s no other way to earn ILV, which is mostly a governance token. The incentive with the revenue distribution is through dividends – no other token has really approached this whole dividend revdis tactic before.

Passive income and bear-market performance

As for the passive-income earning side, I know the game’s in the middle of an upgrade on that right now, but what sort of numbers have been possible from staking ILV?

The game’s Sushi Liquidity pool – the ILV/ETH staking combo – was hovering around 300 per cent for a while before they paused the staking. And the ILV pool on its own was hovering around 30 per cent. I think the ILV pool will continue to decline over time. That being said, that pool is how you get your revenue-distribution rewards. So it will still have some viability.

The Sushi Liquidity pool, I definitely think is going to be a great option into the long future.

So you’d recommend the staking options for people who don’t have much time to play the game itself?

Definitely. If you’re not super interested in the game, I think staking your ILV is probably your safest, lowest risk and possibly highest reward option as well.

I’m beginning to see why you’ve dedicated 90 per cent of your channel to this one game. There’s clearly way more to it all than we can cover here…

It can definitely get quite complex to talk about. But to topline it, I really think the compounding revenue-distribution possibilities for the project are beyond anything we’ve ever seen before. And I think the token can perform really, really well in the bear market, too.

Why’s that?

Because when you get those revenue-distribution rewards as a staker, and you add them to your stake, this thing can compound a lot. And that’s because when people spend money (in the form of Ethereum) in the game, Illuvium uses that to buy ILV off the market and distribute it to stakers.

In a bear-market situation, iIf the ILV token price is comparatively low, then more tokens are bought by Illuvium for more distribution to stakers.

And stakers receive rewards based on the quantity of tokens they have staked – it can really compound like nothing else. If you’re receiving more tokens, then that compounds almost infinitely. And I think eventually the token price goes up because of this.

Basically, you’re rewarded really heavily for reinvesting and re-staking as much as you can. I’m not saying everyone should do that – people should be careful. But I definitely think if you’re in this for the long term, it has a lot of power there.

Scoriox’s personal strategy

So what’s your own strategy with all this then?

It’s basically to avoid selling ILV at all costs! I want to hold as much ILV as I possibly can. I think one day, once Illuvium expands and has quite a few games released, its passive income could become mind boggling.

Personally, I want the token price to be as low as possible for as long as possible, because I think that’s where the big money is.

And you believe in a combo of playing the game and staking?

Yes, I believe, in trying to diversify as much as you can into Illuvium. Because there’s probably about seven or eight different major revenue streams for the game. There’s Illuvitars and land, which we haven’t even gone into. You’re definitely going to want to be prepared to play in-game as well. I think just try and hit as many areas as you can.

If you do have a decent amount sitting on the sidelines, waiting for what to do, I would definitely consider staking the token, because you may be able to just use revenue-distribution rewards to play the game, if playing the game is what you’re interested in.

What sort of entry-level investment would be good do you think?

I don’t think you need that much ILV to get a really good return out of it. I’m looking at, once we start to hit mass adoption, a potential to earn up to $1,500 USD annually per token staked. I really think it can hit that.

So definitely try and get at least half an ILV token staked if you can. And that will help you sustain the game if we hit that 10 million player mark or so.

Otherwise, you could get two tokens for close to $1,000 USD at ILV’s current price, and I think that is a really good starting investment.

Mainstream gaming and crypto

Do you think the merging of mainstream gaming and GameFi will be necessary for the sustainability and growth of blockchain gaming? Or do you think those two things can can just operate fine independently of each other?

I definitely think they could stay separate for quite some time. But I believe that once gamers start to catch on to why NFTs in gaming is important, and people start doing it really well, you’re going to have a transition at some point.

I don’t know when that’s going to happen. But how I see it going down is you’re going to have someone like Meta, formerly Facebook, or some big gaming company – they’ll release their first NFT game. Now it might take a while to catch on, but once it does, and gamers do latch on to this idea, all the other mainstream gaming companies are going to be forced to actually implement this because they’re going to lose to their competition otherwise.

I think we’re looking like five to 10 years down the road for that, maybe. But I think once someone does get the ball rolling, someone large enough with influence, then everyone else will follow suit. I mean, even Disney is minting NFTs, so you never know.

There’s been a fair bit of backlash from mainstream gamers towards NFTs, though, right?

Yeah, and that backlash is going to be hard to overcome. But that’s the advantage Illuvium has – it can build something without backlash, because it didn’t have that audience. It had a different audience to begin with.

But I think eventually a company is going to come in where they can afford to take backlash. It’s like forcing them to like eat their greens. And then eventually, they thank you for it when they’re happy and healthy down the road. A company is going to be big enough to do that eventually.

I’m sure there’s so much more we could cover about how to earn from this, and about GameFi in general but maybe we’ll save it for another chat! Is there anything you want to add now, though?

Only to say definitely check out my channel for more info. I’m releasing as much varied content as I can. I often look at the investing side of things but I’m definitely going to be moving into streaming the game as well and trying to be the best competitive player in Illuvium. I’m really excited for the competitive side of the game – I think it could be revolutionary. If it catches enough attention, we could be seeing the start of something seriously great.

You can learn more about Illuvium and other GameFi projects on Scoriox’s YouTube channel.

This Q&A has been edited lightly for clarity. Stockhead has not provided, endorsed or otherwise assumed responsibility for any financial product advice contained in this article.

At the time of writing, the author holds several crypto assets, including Bitcoin and Ethereum, and yep, some Illuvium, too, among other gaming-based tokens.