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Splinterlands offers players two in-game currencies.
- Splintershards (SPS)
- Dark Energy Crystals (DEC)
If you’re weighing which currency to hold your hard-earned rewards when you're not buying cards there’s a lot to consider.
Now of course, I’m not a financial advisor and this is not financial advice. That’s not to stop us from quickly reviewing the facts behind either currency to empower you, dear reader, to make a more informed decision.
DEC is the reward currency for Splinterlands. Steem Monsters Corp, the team behind Splinterlands, has made it clear that the currency is “soft pegged” to $0.001 per DEC.
This price is maintained through opposing forces. Daily rewards increase the supply through minting 1 million DEC daily platform-wide. This is used for in-game rewards and the backing of newly minted cards. DEC is currently burned (or reduced) through the sale of miniset packs (like Essence Orbs and ?ZM?RE Dice), guild contributions, skins, and potions.
DEC is a “stablecoin” of sorts. Many that hopped on the SPLINTERLANDS bandwagon last year (myself included) grabbed lots of DEC as the game’s most useful commodity. Having seen a similar rise in Axie Infinity’s AXIE token, it sure seemed like Splinterlands would follow suit.
But DEC is not AXIE. That role is served by SPS at Splinterlands. DEC is akin to Smooth Love Potions. It’s meant to be used and rewarded but is not scarce or used for governance.
According to the official SPS documentation, SPS is the governance token for Splinterlands. At least, that’s how its been advertised. No actual governance features exist as of writing this but we’re told that it’s coming.
That brings us to another key fact about SPS: it’s new. Throughout 2021 and 2022, it’s been rolling out daily airdrops for holders of Dark Energy Crystals, cards, packs – basically every manner of Splinterlands NFT and currency.
Airdrops are alluring. Free money, right? Well, not exactly. It’s never that simple as that value has to come from somewhere. 400,000,000 tokens will have been issued by means of airdrop. That’s 13.33% of the whole advertised initial supply, which is 3,000,000,000.
SPS sure looks like the better long-term hold based on limited supply and governance.
How has DEC performed?
Using my favorite crypto ROI calculator we can see in the short-term, DEC has had quite a ride. As the tides rose for all cryptocurrency in 2021, it took various Play2Earn games along with it. Here's the ride that a $5,000 investment would have taken.
But now, we see DEC doing exactly what the soft-peg mechanisms are intended to do.
How has SPS performed?
Near-term, SPS follows a similar trend. Price movement has been very closely correlated to DEC.
And, if you’ve held through the airdrop, SPS has lost value faster than DEC.
What is the better long-term investment?
It’s important to remember that past results are not an indicator of future performance. Let's review the facts.
DEC represents in-game utility. It makes sense to put money into a currency that serves a purpose. It doesn't make sense to put money into a currency that doesn't.
Outside of a few tournaments, you can’t do much with SPS in 2022. That will change. In an AMA with the Splinterlands team in March, the devs stated that “the sole purpose of the team is to improve SPS tokenomics”. This was controversial, but it's clear that the team believes that as SPS value goes, so does all of Splinterlands. With cards, packs, maybe even DEC, lagging in its tailwind.
Based on those facts, the case for SPS looks stronger once the airdrop supply stops increasing and new airdrop tokens stop being minted. On paper, anyway: the degree to which these factors will impact the value remains to be seen. Ultimately, its up to you where you deploy your liquid in-game capital. DEC, SPS, or outside the game entirely.
Whatever you choose, good luck.
