Economic Planning

When it comes to the framework for any economy, managing expectations is the most important task. Expectations are inseparable from trust, and people naturally price their beliefs about the future into their decisions. The same is true for EVE Frontier. Suppose players believe that CCP Games can arbitrarily change the rules. In that case, they will adapt their behavior to hedge against risk, undermining the game’s economic stability and the long-term value of its token.

In the process of developing the economic framework for EVE Frontier, it was crucial to examine both how the framework would affect relevant objects and actions within the game and how that would influence the behavior of both player and non-player stakeholders. The importance of this framework becomes more significant when considering that EVE Frontier will be one of the largest and most complex virtual world economies.

The proposed EVE Frontier model aims to:

● Ensure token demand scales naturally as the number of active players grows over time

● Facilitate resource pricing mechanisms that keep market dynamics smooth and predictable, avoiding sudden spikes or crashes

● Account for different kinds of participants, including those motivated primarily by financial gain, and design safeguards to prevent these behaviors from causing destabilization

● Reduce the impact of market volatility by building self-corrective mechanisms

● Encourage balancing strategies that mitigate price swings unrelated to in-game activity

● Protect gameplay from the negative effects of unexpected external changes.

The token’s primary source of demand is the potential that it unlocks within the virtual world. Regardless of market activity, the token will be required by those who look to build, explore, or battle to survive on the Frontier. The demand for the token increases as more players join the game and as existing players increase their activity. This utility within the game makes the entire system more resilient to external shocks. Market volatility is inevitable, but downturns can lead to increased activity in the game, which can, in turn, lead to more demand for the token.