What is Lord Arena (LORDA)?
Play to earn gaming has become popular over the past few years. This type of gaming allows players to play a game and earn cryptocurrency tokens that can subsequently be sold for real cash. It’s no surprise that this has become popular as it allows players to actually receive some monetary benefit from playing a game.
A lot of play to earn games have popped up over the past few years. And the overwhelming majority of them have completely failed – it’s actually pretty difficult to launch a successful play to earn game.
One play to earn game attempting to make a mark on the industry is called Lord Arena. It’s an RPG game that allows players to have an NFT deck of characters and fight other players. The winner of these fights receives LORDA tokens, which can then be sold for real cash.
Unfortunately, it appears that the founders of this project have rug pulled with the investor money. That said, it was a relatively promising play to earn game on the Binance Smart Chain, so it’s worth discussing.
What is Lord Arena?
Lord Arena is a play to earn game on the Binance Smart Chain and Solana. It’s a deck game, which means that players have a deck of cards (NFTs) that they use to battle other players. These cards (NFTs) represent characters with certain attributes that can be useful in these fights.
Basically, think of it as a blockchain version of Pokemon. You build a deck and then fight other players with all the characters in your deck.
One thing that made Lord Arena more promising than other blockchain games is that the game did not look completely terrible. To be frank, a lot of blockchain games do not fun to play. It’s fairly obvious that the main appeal to most blockchain games is that players can earn money, but Lord Arena was different. It actually looked like the type of game that people would play if there was no monetary benefit.
What Went Wrong with Lord Arena?
Lord Arena had a few red flags that investors should have seen if they did their due diligence. However, this project was launched in late 2021, which was the peak of the cryptocurrency bubble. New projects were appearing everywhere and investors did not want to miss out on the next big thing.
We will give credit – it appears that Lord Arena has a doxxed development. We say “appears” because while the whitepaper does include the names and pictures of the founders and team members, it’s difficult to find any evidence of them existing outside of this project.
Of course, we will give them the benefit of the doubt and assume the founders are who they say they are, but it should make investors at least a little leary when it’s so difficult to find any shred of information about the founders on the internet.
Anyway, what really went wrong with this project was the amount of institutional backers that it had. According to the website there were 37 institutional backers, which is an absurdly high number of backers for a project. The project may have been exaggerating about the backers because the general public views backing by big investment groups as a good thing, so a project will claim as many as possible.
The reality is a project having institutional backers is a terrible sign. The reason is simple – institutional investors only care about their return on investment. Remember, it’s difficult to create a successful cryptocurrency project and it can take years for it to become profitable. A more profitable, albeit shrewder and ethically questionable, strategy is to simply dump the tokens purchased at pre-sale for a 10x or even 100x return.
It’s a relatively common trend in cryptocurrency. This has the downside of completely destroying any future of the project as the price collapses and people lose interest when their investment goes to zero overnight.
If you look at the price chart for $LORDA, then you will see that the price simply fell after the release. There was no sustained recovery and the price simply bottomed out to zero. The price bottoming out to zero came with the trading volume dropping to the two digits.
With a price at zero and a non-existent trading volume, it’s difficult for people to find the motivation to play the game. As such, no one plays the game, no one buys the token, and no one cares about the project.
The Red Flags to Look for in a Play to Earn Game
There are some red flags that you should look for in a play to earn game. Lord Arena had some of these red flags, but it did not have all of these red flags. This made it so that a lot of otherwise savvy investors lost money with Lord Arena.
- Anonymous founders
- Lord Arena did not have anonymous founders, which made a lot of investors trust the project.
- Too many institutional investors.
- This is a bad sign as these investors often receive tokens at a very low price during the pre-sale. They will then dump the tokens during the public launch.
- Poorly written whitepaper
- Lord Arena had a decently written whitepaper.
- No project at the time of launch
- Lord Arena did have a project at the time of launch.
- Unfun looking game
- Lord Arena looked somewhat fun to play, which is always a good sign.
So, Lord Arena had one red flag. Unfortunately, it had the most critical red flag of having a large amount of institutional investors. This red flag more or less doomed the project from the start.
Is Lord Arena (LORDA) a Good Investment?
No, Lord Arena is not a good investment. The market cap is $11,000 and the 24 hour trading volume is in the double digits.
This would not be a huge problem if the project was improving, but it’s not. As you can see from the chart posted earlier, the price of the token has stayed at nearly zero for almost all of 2022.
It’s a dead project and not worthy of an investment.
Now, do not fall for people claiming that you could make 100% if the project goes up in price. You will not because there likely will be no one willing to purchase the token.
To summarize, Lord Arena was a play to earn game that made some nice promises, but ended up falling flat because early investors dumped their tokens almost immediately after launch. This is a fairly common trend in cryptocurrency, which is why you should be weary of projects that receive a lot of investment from venture capital firms and other institutional investors.