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Why Hex should Formalize the Gold Exchange

The Issue

Hex has one of the most open and fair economies in all of gaming. It allows open direct trades on in game resources and currency with an Auction House to facilitate blind transactions. Though Hex is a captured command and control market from the broadest possible perspective, with in the context of the game, it is an ideal capitalistic model of economy. Assets obey the concepts of supply/demand and players feel value in their collections. Some inherent problems exist with equipment and consumables, but the player base is well communicated with about features when the information becomes available. The fungibility of currency between the in game assets is a key reason why Hex is a shining example of a player focused game economy. That reason alone is enough to ask why is the fungibility of gold to platinum left informal?

Since gold was introduced with the spinning of chests, Hex players have been using the tools at their disposal to trade gold for platinum. By the very nature of how each currency is created the trade between the two currencies of platinum and gold came to symbolize the exchange between PvE and PvP assets. This is by no means against terms of service but this process is highly informal at the currency level. Players must expend time locating buyers/sellers for their transaction and the perceived value of gold remains consistently in flux. Those same players also take on the risk of unknown actors when they perform new transactions. Risk adverse players are turned away by the process and that would be a minor issue except much of Hex’s target audience are risk adverse PvE players.

The issue this barter process creates is that hard to track negotiated transactions are opaque to the casual observer. Such a process does not breed confidence in exchange. Thus a new PvE player is not rationally guided from the campaign in a way they feel driven to participate in the PvP part of the game. They must spend resources to interpret auction house transactions and then jump hurdles to expand their collection beyond the granted PvE assets. New players do not have a formal guide to value their gold, new cards or time just as they jump into the game. How much should a PvP legendary be worth versus a PvE legendary? Should I spend my gold on packs or single cards? Though the community is available for advise the client has no obvious way to teach a player the value of their efforts. Players must go to HexPrice or some similar service to get a semblance aggregate value. This breaks immersion and creates hurdles for new players when they already face a steep learning curve. There is a better way.

A Potential Solution

A new item can be introduced into the online store that can formalize the trade of plat to gold into measurable, traceable and simple transactions. Let us call it Kismet’s Favor. This item would be purchased for 100 platinum in the store and could only be listed in the auction house for gold, allowing normal auction fees. After the token is sold the receiving player activates the favor and gains 100 platinum. If a player accidentally buys a token with platinum by mistake they can easily dissolve a coin to refund their purchase.

Implementing this simple system has several significant benefits. Foremost it formalizes the platinum to gold economy in a player driven way. Kismet’s Favors only exist when players generate them and only sell for what gold holders are willing to pay. Neither side of the transaction need know the other and the transaction risks are made plain immediately.

Data generated from this transaction can be more readily studied internally at Hex as well as by the community to evaluate the health of the economy. The transaction efficiency and risk reduction will incentivize players to use the system as their primary trading method between currencies.

This system is also mostly implemented. Only the vehicle, the Kismet’s Favor, would need code to redeem in plat and some interface work would be needed to have the item listed in the store. Some coding maybe needed for optimal auction house searching but the tech team at Hex has made crazier effects in AZ2.

Most importantly it gives players an understandable value driven path from the PvE side of the game into the PvP side of the game while expanding their options. Both sides of the Hex house, PvE and PvP are wonderful experiences but PvP feels daunting for PvE players to jump into. There is high emotional pressure to perform and “live the dream” from the first earned tournament. The risks a player must take with their saved gold exposes them emotionally in the process of grinding out value. Every risk is a hurdle to adoption of the PvP play style. Formalizing the gold trade with something like Kismet’s Favor reduces risk while staying player driven. Long time PvE players would have a clear self-driven path into PvP where they can experience the other half of the game.

The Risks

A risk does exist when the gold trade is formalized. Any irregularities in gold production and balance will be made apparent exponentially faster. Tools must be in place in place to manage the gold supply so that card inventories do not escalate too quickly for PvE assets. A player driven method to destroy PvE assets and possibly PvP assets will likely be required in that tool set when a Kismet’s Favor like approach is implemented. If performed correctly the Hex economy will continue to be one of the best examples in the industry and may become the most shining example of mass social co-operation in gaming.

If the program is miscommunicated as Hex Ent selling gold, community members can make a pay for power argument. Only selling Kismet’s Favor for platinum and not vice versa prevents this argument while keeping economic integrity. Hex will only be selling a safe and reliable method for transferring platinum into gold. Card creation and initial platinum purchasing remains player driven and reflective of the community’s collective actions. That is important because it gives observations and conclusions drawn from data useful meaning.

Why not Gold into Plat?

Should kismet’s Favors be purchasable in gold? Wouldn’t that be simpler? No and no. Pricing in the online store already exists in platinum but more importantly, a new item in the store drives real money into Hex’s coffers. They need the income to keep the sets rolling out, servers up and devs happy. Pricing the token in gold flips the mental structure from “buy platinum” to “grind PvE”. Though enticing to have players play the game it does not also serve the business purpose of keeping Hex Ent going.

That said formalizing the exchange in either direction would have similar in game economic outcomes but product and store facing are critical concerns which must be aligned. Smaller numbers in the cost section of the store are better than XX,000 gold coins. Emphasizing the feeling that the store UI gives as well as how it informs the customer are critical business components. Values in the hundreds appeal more than values in the thousands. Additionally, the simple alignment of only one currency usable in the store keeps a significant degree of simplicity that cannot be underestimated.

Why Player Driven Tokens?

There are multiple ways Hex could formalize the trade between gold and plat, so why use a purchasable token? It gives Hex the best selection of options with the lowest risks. The team could choose to implement a hard conversion method. Turn in your plat or gold and immediately get the other currency! The immediacy is appealing but they must have a crucial piece of information, how much should the conversion rate be? Rates are important!

They could set a value and then hard code it into the interface but then they would be neglecting economic history. Governments have been unable to make decisions in the past because of the rigidity of a currency system. The impact of money creation/destruction in fixed exchange system amplifies the impacts across the whole population.  Too little money causes disruptive deflation, while too much piles up inflation to hyperinflation. Getting an exchange rate incorrect forces the type of imbalances that lead to perpetual teeter-totters that require active management. We want Hex expanding the game instead of directing resources to a full team of economic advisors.

Who would know the rate then, how should it be determined? The reason the rate is so hard to determine is that Hex would have to try and guess what every player prefers to pay for each currency. Guessing that amount fairly across thousands of players is impossible but letting each player work it out anonymously between ourselves solves that problem for everyone. Hex then reduces management of the system, the implementation costs as well as maintenance costs. Simple for Hex and flexible for us has a better feel than a rigid guess work systems that the devs must get perfect on top of every other choice they make.

Conclusion

By the end of the day we want our hobby to keep going and be enjoyable by a wide audience. Removing risk barriers for players to feel comfortable in the exchange of in game assets goes a long way to achieving Hex’s goals. Players will get their needs filled faster and more simply. PvE players will gain a tool to earn more PvP cards and PvP tournament attempts. Accomplishing this goal by reusing existing technology with a few tweaks gives Hex a quick win with long lasting results. The team at Hex may have their own plan in the works or have higher priorities but when we start looking at game economies the more efficient transactions become the better off the participants are.

Thanks for reading! Let us know what you think in the comment section below!

Mokog can often be found streaming limited and constructed play on Twitch. Known for his Hexonomics videos Mokog helps new and experienced players make the most of their Hex investments. Find him on twitter as @HexHunterMokog, on Twitch at www.twitch.tv/hexhuntermokog, or on YouTube www.youtube.com/user/HexHunterMokog

8 Comments on Why Hex should Formalize the Gold Exchange

  1. This is the most intriguing hex article for me in ages. As a player who started out as a staunch free to play player (before streaming ate all my hex money. Lol) the gold to plat ratio is something I care about deeply

  2. I’ve always been a supporter of an AH-based “direct” gold/plat exchange. This seems like an elegant solution to me.

  3. Sounds like a solid idea, hopefully CZE will give this serious thought. Very well written article also.

  4. A token system works, but needs to be created with careful thought on how it will ebb and flow with the economy.

    1 way they could implement this, is, say they set the tokens to be worth 100plat. This would make good sense for the sake of entering tournaments/buying packs from the store.. It’s clean cut. When they do this, they can set the gold amount to buy these tokens to, let’s say based on today’s market: 230gold:1plat – or 23000gold for 1 token. When the token enters the system it joins a queue of tokens based on supply and demand. A player can then buy the token at 100plat, for 23000gold. My thought is that if there are more than 100 tokens in the queue still for sale, a few different things happen.

    #1 The price in gold to purchase a token goes up

    #2 Every few days that pass continue to increase the price in gold to purchase a token

    #3 Tokens cap at 1,000

    Ideally – this token system, if ever implemented is 100% based on the demand for gold by players paying plat. If you simply allow players to trade in their gold for plat, when the gold is not desired, you quickly devalue collections. Having this be more of a delayed bid/ask system works a lot better for the economy that is attempting to be established in HEX.

    Others have talked about this, and suggested that players be able to lump their gold, or plat together in a bundle and post it in a free exchange within HEX. IMO, that is more elegant than HEX controlling the interaction through an internally controlled invisible hand.

  5. Basically – talking through all of that – I entirely agree with your proposed solution.

  6. This need is already filled by the highly liquid booster packs. In fact, booster packs have the additional feature of being redeemable for cards and chests, and therefore provide linkage between almost every asset in the game (platinum, gold, cards, equipment, and many mercenaries).

  7. I do not believe Hex should set a rigid exchange rate or even a hybrid ratching rate with how the AH currently operates. If you set the token rate to a fixed amount of plat then as players ask for gold on the AH we will figure out the right rate. You make the token sellable until consumed and the player bases natural inclination to seek arbitrage will settle the exchange rate pretty quick. Gold inflation will become very apparent in the system BUT that is a desirable data point so it can be prioritized.

  8. @elodil Packs are the best chosen substitute but they have an inherent lag time for conversion, two sided risks of currency valuation and a need for more advanced principle to participate. Something like a token specifically bought for fixed plat is more effcient to convert gold to plat. Since the conversion would be settled in 1 AH transaction it would also be cheaper to the market bottom line.

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