Investment Highlights

Before diving deeper into the game, let’s review some investment highlights:

• Although more recent user stats are hard to find, League of Kingdoms has significant players earlier this year averaging 80,000 users daily, and 400,000 monthly. However, since this is crypto, those numbers can vary widely.
• The management team has substantial Web2 gaming experience.
• League of Kingdoms is available to play for free and without connecting a Web3 wallet which reduces a key barrier to entry. 
• The game’s VC backers are heavyweights in the space including a16z, Fractal, YGG, and The Sandbox.
• While the game has a free-to-play level which returns a modest amount, the landowner meta has a base case ROI of 200 days, or an annual ROI of 82% . 

What is League of Kingdoms?

One of the most popular mobile game genres is multiplayer online (MMO) strategy games, where each player builds his city and army, and gathers resources while competing against other players. Today we’ll cover one of the most popular Web3 MMO strategy games available on PC, Android, and iOS. League of Kingdoms (LOK), with more than 500k downloads in Play Store alone and 80,000 average daily users (in early 2022), is one of the strategy gamer’s favorites.

Launched in July 2020, League of Kingdoms is one of the first blockchain MMO strategy games. Players develop their kingdoms, cultivate resources, fight against monsters (PvE), and compete with opponent kingdoms (PvP) or alliances (MMO). All land plots are non-fungible tokens (NFTs), along with tokenizable resources, skins, and a variety of other game assets.

One of the main reasons that League of Kingdoms has gained such popularity is because if you’re a Web2 gamer and you haven’t had any experience with Web3 games it’s a seamless transition with this game – no wallet setup required. The game is free-to-play and is as easy to start playing as most traditional Web2 mobile games that you can find in your device’s game store.

Tech / Infrastructure

The game is available to play without creating a crypto wallet or connecting to the blockchain. However, to use external marketplaces to buy and sell resources (or other NFTs, such as Land), you will be required to connect your account to a wallet. Minting and trading started on the Ethereum blockchain and OpenSea, but it has recently transitioned to Polygon. 

History

NOD Games was founded on March 2019 after entering an accelerator/incubator in April, to raise money for League of Kingdoms. On December 2021, NOD Games managed to raise $3M in a Revenue Generating Seed Round, from a host of well-known crypto investors, including Hashed, a16z, Sequoia India, and Binance Labs.

Management Team

Chan Lee / CEO

Chan graduated with a degree in Computer Science from Pohang University of Science and Technology (POSTECH). He started his career as a product designer at Samsung Electronics. Other highlights of his career are the DAYLI financial group, and NEXTMATCH, the #1 dating app in South Korea. He is also the CEO of UNOPND

Steve Hwang / CTO

Steve was a founder member of Gamevil, now a publicly listed game behemoth with over $120 million in revenue, while studying Computer Science and Electronics Engineering at Seoul National University. He also worked at Electronics Art, NHN, and COM2US, where he directed the server architecture and development of games such as FIFA Online, NBA Street Online, Go Online, and many more. Previously he has been the CTO of Weneepl, and the CEO of 109 Studio.

Han Yoo / COO

Han is in charge of the game studio’s marketing, operations, and business growth projects. As a qualified management professional, Han began his career with LG Electronics in supply chain and product management. Han was captivated by blockchain NFT gaming and bought into the idea, leading him to join the NOD Games founding team in early 2019.

Edgar Kim / Chief Game Designer

Edgar is a former NEXON and Smilegate game designer, which created “Crossfire”.

Sean Moon / Chief Server Engineer

Sean was Lead/Principal Server Engineer for NHN, XLGames, NeoWiz, Netmarble, Gravity, and other companies.

Felix Lee / Chief Blockchain Engineer

Felix is a former software engineer of NEXON.

Investors (VCs)

The following VCs have invested in NOD Games and League of Kingdoms:

• Hashed
• a16z
• Sequoia India
• Binance Labs
• BlockTower Capital
• Sky Vision Capital
• Yield Guild Games (YGG)
• DeSpread

The total funding amount, based on Chainbroker, is calculated at $7.1M

User / Social Stats

According to Binance Research in early 2022, LOK had “15,000 concurrent players, 80,000 daily active players, and 400,000 monthly active players”. Unfortunately, we were unable to find reliable current user stats so these numbers could vary significantly. 

As of 11/21/22, League of Kingdoms’ social media team was highly active, with ~85,000 Twitter followers and ~50,000 Discord members.

Market Stats / Tokenomics

The game features two different tokens. $LOKA is the governance and utility token, while $DST is the token earned by Drago NFTs and is used for breeding. Note that $DST is yet to be released.

$LOKA has a circulating supply of 25,100,000 and a total supply of 157,817,308 tokens.

Price Chart

League of Kingdom’s $LOKA token is currently trading at $0.34, down 41% over the past three months.

Game Mechanics

At the moment, the most common playing path is the following:

Create a Kingdom

When you first enter the League of Kingdoms metaverse, you will be given a piece of land to build and develop your kingdom. Note that this piece of land you’ll cultivate is part of a bigger cut of land that is owned by another player as an NFT. 

Inside your kingdom, the three main activities that you’ll spend time and resources on, are building structures, researching, and training troops.

You’ll need Farms, Quarries, Goldmines, and Lumbercamps to gather resources and Barracks to grow your army. Research takes place in the Academy, where your scientists study new technologies to evolve your kingdom. In the Barracks, you may choose to train Infantry, Archery, and Cavalry. Each troop differs in its battling and gathering abilities (troops are also used to gather resources outside of your kingdom).

Farming & Hunting

There are 5 primary resources that you can produce in your kingdom or farm from resource nodes outside your kingdom. These are Food, Wood, Stone, Gold & Crystals (Crystal mines spawn only on owned lands).

When scouting the field outside of your kingdom’s walls, besides resource nodes, you’ll come across various monsters. Each monster drops different rewards based on its level. By banding together with your alliance, you may raid bosses and special monsters for better loot.

Join an Alliance

As you progress deeper into the game, you’ll start struggling on your own. Without being part of an alliance, sooner or later, other players will take advantage of that and will start raiding your kingdom, stealing your hard-earned resources.

Being part of an alliance is a prerequisite for dragon hunting, conquesting shrines and congresses. You’ll also have access to a variety of other benefits, including but not limited to alliance gifts, stores, and buildings.

Battling

Battling is divided into the following categories:

• PvE. Either solo or by forming rallies, you can deploy troops to fight against monsters for resources and XP.
• PvP includes fighting against other kingdoms and guilds.
• MMO. The game includes a variety of MMO content, such as the Shrine, the Congress, Continent vs Continent (CvC) events, and much more upcoming, such as the Guild War in 2022.
• Treasures are equipable items that provide various buffs and skills. There are standard, magic, epic, and legendary treasures. Treasures are unlocked by collecting treasure shards.

Meta

In terms of the meta, there are a few paths that a player can take, depending on his budget, goal, and personal preference. These are:

The Free-to-Play 

League of Kingdoms offers most of its features for free, so anyone can start playing and experience all aspect of the game. This includes building and developing your kingdom and army, joining an alliance, and battling against other guilds—one of the things that sets League of Kingdoms apart from other blockchain games. Resources like Lumber, Gold, Stone, and Food, are free to gather by free-to-play users and available to sell as NFTs on marketplaces such as Opensea or PlayDapp. This is possible on Ethereum and Polygon as well.

The Drago Owner

If you’re looking to expand your gameplay opportunities and earnings, a Drago NFT is what you should be looking for. This NFT will strengthen your army, increase resource production and allow you to earn $LOKA.

$LOKA will provide players with the following privileges:

• Propose and vote on various decisions
• Stake and earn yields
• Marketplace purchases
• Breeding/upgrading fee coverage

The Dragos Genesis Sale took place on May 2022.

Dragos provide your army with several buffs, while they also fight side by side with your troops, expanding your quiver of tactics and strategies. They come in 5 different elements: Fire, Terra, Aqua, Dark & Light.

Dragos are minted on the blockchain, with the floor price on the official marketplace currently at 0.16 $ETH. These NFTs will be the key to unlock $DST (Dragon Soul Token) rewards, the in-game reward token. 

You’ll need $DST to breed and hatch a Drago’s egg, upgrade Drago’s lair, stake to train/upgrade Drago, and gain access to numerous mini-games, among other things.

Player can rent out their Dragos to other players which helps give access to rewards to more players.

The Landlord

The third and most appealing aspect of the game’s Meta is owning a piece of Land. Owning Land allows you to earn passive income on resources (5% of total harvests that occur in your Land) and $LOKA (10% of in-game profits from sales). Only 65,536 parcels exist, of which a small percentage is in circulation. As a Landowner, you can gather resources, fight monsters, and complete quests to earn developer points. $LOKA, the game’s token, will be distributed according to the Landowner’s developer points. You can purchase a piece of land NFT for 0.15 $ETH in OpenSea. Other potential examples of Landowner perks are special airdrops/whitelist rights, and community roles.

(Note: DAI/BUSD rewards are replaced with $LOKA)

Land Developer Points

Landowners acquire developer points by doing the following: 

• Mining resources (for each 50,000 the Landowner gets 1 Developer Point)
• Mining crystals (5 crystals = 1 Dev. Point
• Consuming crystals (1 crystal = ⅕ Dev. Point)

Developer Points are tied to the Land’s Level. Increased Land levels will improve resource output inside the Land.

Developer Rewards

Development Rewards are a type of loyalty reward that Landowners can earn. Every piece of Land comes with inherent rights to the reward pool, which is a percentage of the game’s worth set aside to support land development. To maximize your Development Rewards, you will need to continue to develop your Land to stay competitive with other Landowners.

The development reward will be distributed primarily based on the number of D-points accumulated by each piece of Land. The following is a formula for allocating Development awards.

Resource Rewards

Being a Landowner provides the perk of having a consistent supply of resources collected from your Land by its inhabitants. The reward earned will be 5% of the total resources obtained from the Land in a day. The residents will still retain all they have acquired or mined.

The resource reward pool will accumulate for 24 hours before being claimed. After claiming, the resource accumulation clock will restart. If it is not claimed within 24 hours, it will no longer increase, but all history (track records) of resource accumulation will be recorded in the land portal for owners and other prospective land investors to check.

Roadmap

If we look at the roadmap, there are some important checkpoints we are looking forward to. Firstly, the release of the $DST token is highly anticipated in the community. This will kickstart the Play-to-Earn mechanics of League of Kingdoms (apart from Landowners), as it is important to see how the token economy will flow.

The Drago Rental feature is another aspect we are expecting to come along with the $DST release, as Drago NFTs are required to start earning the token.

Other upcoming checkpoints that you can expect in 2022 are:

• Staking Dashboard
• Land Rewards Hub
• Partnerships with other Web3 projects (partnerships that have already been announced) include:
  • Fractal
  • Yield Guild Games (YGG, the largest P2E guild)
  • The SandBox
  • PathDAO
  • MakerDAO
  • Kyber Network
  • UNOPND
  • Sesame Labs
  • MetaverseGo
  • tripleS (a fan-directed web3 Kpop band)
• E-sport ready “Guild war” tournament launch
• “The Colosseum” PvP arena
• Dragonian Arena (PvP arena for Dragos)

In the long run, the team is working on a governance agora, an E-Sports and GameFi Dashboard, while they’re also developing a blockchain Layer 2 that will host the game in the future.

For the full Roadmap, you can check the official whitepaper.

ROI Scenarios

Let’s explore what you can expect to earn, depending on your initial investment.

• Firstly, the Free-to-Play scenario. Without any investment, you may earn some rewards by selling resources in the marketplace. Currently, the floor price for 1,000,000 of any resources costs 0.03 $MATIC (approximately $0.03). It’s possible to earn rewards by playing for free, but as expected, they are relatively low. However, by continuing to play the game and expanding your kingdom these rewards will increase.
• Secondly, the Landowner scenario. This is the most appealing to Play-to-Earn users. The floor price of Land is currently at 0.15 $ETH ($188). The 24 hour emission rate of $LOKA is at 17,857.1429 for approximately 6,500 pieces of Land. This accounts for approximately 534,000 $LOKA per month. Based on the Land Level, Landowners may earn about 3 – 190 $LOKA per month. Thus, a Level 6 Land earns about 84 $LOKA per month ($28.56). This accounts for an ROI of 200 days or an implied annual return of ~82%.

Below we have calculated various ROI scenarios for the Landlord meta including Base Case (price stays flat), Upside Case (price rises 20%) and Downside Case (price drops 50%).

Key Takeaways 

• League of Kingdoms has a reputable team with an established track record, as well as backing from major cryptocurrency players such as Binance. 
• The game has already secured a slew of partnerships with other Web3 projects to help with growth.
• Base case ROI of ~82% based on Landowner meta.

Key Risks

• $LOKA token’s supply has yet to be fully unlocked. Just 16% or 25M tokens of the total 157M are in circulation. This could put pressure on the token price over time 
• Competition in the space is intense.
• Like many Web3 games, League of Kingdom’s play-to-earn game economy is at risk of boom and bust cycles due to player sell pressure, especially with the introduction of the $DST token.  

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