The Splinterlands economy offers players various strategies to participate in battles, tournaments, and brawls. One critical decision every player faces is whether to purchase assets like NFT cards and SPS tokens outright or rent them for temporary use. In this blog post, I will explore the financial implications of these options, specifically for Modern and Wild Leagues, and determine their profitability.
A player starting in Splinterlands has a couple options:
- Rent NFTs and SPS to earn rewards
- Purchase NFTs and SPS to earn rewards
Rental Option:
Right now you can rent a max-level Chaos Legion Core and Reward card deck for around 500 DEC per day:
To battle in Modern Diamond it is optimal to have at least 200,000 SPS staked or rented which costs about 1,400 DEC per week:
Current Rental Costs for Modern League
To evaluate the rental option, let’s first examine the costs associated with renting assets:
Cards:
- Renting a max-level Chaos Legion Core and Reward card deck costs 500 DEC/day.
- Over a typical 14-day season:
Total DEC cost: 500 DEC/day * 14 days = 7,000 DEC.
Dollar equivalent: (7,000 * $0.798)/1000 = $5.586.
SPS Tokens:
- Renting 100,000 SPS for a week costs 1,400 DEC.
- Over a 14-day season:
Total DEC cost: 2,800 DEC for 100,000 SPS or 5,600 DEC for 200,000 SPS.
Dollar equivalent for 200,000 SPS: (5,600 * $0.798)/1000 = $4.4688.
Total Cost:
- Cards: $5.586
- SPS: $4.4688
Combined: $10.0548 per season
Earnings Potential in Modern League
Battle Rewards:
- With a competitive maxed-out deck, players can engage in approximately 455 battles per season.
- Assuming a 50% win rate, this results in:
227 victories.
Earnings per win in Modern: 10 SPS.
Total SPS earned: 227 * 10 = 2,270 SPS.
At the current SPS price of $0.007889, the dollar value of these earnings is:
- 32,270 SPS * $0.007889 = $17.90.
Additional Earnings:
Brawls: In the last season, brawl earnings totaled 233 SPS, equivalent to:
233 * $0.007889 = $1.838137.Tournaments: Potential earnings from tournaments can significantly increase profitability but vary widely depending on skill and participation. I don't participate in tournaments, but if you want to maximize your earnings you should.
Net Profit:
- Total earnings: $17.90 (battles) + $1.838137 (brawls) = $19.738137.
- Rental costs: $10.0548.
- Profit per season: $19.738137 - $10.0548 = $9.683337.
Return on investment (ROI): Almost 96%.
This means that at current rental prices for SPS and Cards it is profitable to play Splinterlands in Modern.
Wild League Analysis
Rental Costs:
The costs for renting cards and SPS in Wild League are similar to Modern, but an additional 2,000 DEC Wild Pass is required:
- Wild Pass cost in dollars: (2,000 * $0.798)/1000 = $1.596.
Total rental cost: $10.0548 + $1.596 = $11.6508.
Earnings Potential:
With a similar win rate and number of battles, Wild rewards are approximately 5 SPS per victory:
- Total SPS earned: 227 * 5 = 1,135 SPS.
Dollar value of SPS: 1,135 * $0.007889 = $8.95.
Net Profit:
- Total earnings: $8.95 (battles).
Rental costs: $11.6508.
Profit per season: $8.95 - $11.6508 = -$2.7008 (loss).
Additional Considerations:
Players in Wild can offset costs with brawls and tournaments, but the lower SPS rewards make profitability challenging for those renting assets.
Botting in Wild is unlikely to be profitable under current conditions if you are renting both SPS and Cards.
Buy vs Rent: Long-Term Perspective
Advantages of Buying Assets:
No Recurring Rental Costs: Eliminates the need to rent cards and SPS each season.
Capital Appreciation: NFT cards and SPS tokens have the potential to increase in value over time.
Passive Earnings: Staking SPS provides an additional 15% annual yield, creating a consistent income stream.
Challenges of Buying Assets:
High Upfront Investment: Purchasing a max-level deck and 200,000 SPS requires significant capital.
Market Volatility: The value of SPS and cards can fluctuate, potentially reducing their resale value.
So to buy a Chaos Legion Core and Reward sets it would cost $733 and 200,000 SPS would cost $1,577.8 for the total cost of $2,310
If you are just trying to return your investment at $20 per month savings on rentals it would take you 115 months or around 9.6 years to return your investment via rental savings only. Obviously there are other considerations like if the cards or SPS would appreciate then the rental costs would also rise and it would really make sense to buy assets instead of renting them.
Key Takeaways
Modern League: Renting assets in Modern is highly profitable, offering a solid ROI of nearly 96% per season with additional upside from brawls and tournaments.
Wild League: Renting is not profitable under current conditions unless players excel in brawls and tournaments.
Buying vs Renting: For long-term players with available capital, purchasing assets may provide a higher total return and offer additional benefits like staking rewards and asset appreciation.
Recommendation: If you’re starting with limited resources or prefer flexibility, renting is a viable strategy for Modern League. However, investing in assets for the long term may yield greater financial rewards, particularly if the Splinterlands ecosystem is successful in the long term.
If you wonder what is the best way to get involved you can use my link to begin your Splinterlands and HIVE journey.
