Fake World Assets Fuel Crypto's Latest Obsession

A new phenomenon has emerged in the crypto space, capturing the attention of users and sparking debate about its sustainability. Fake World Assets (FWAs), a type of onchain gacha, have become the latest craze, with users paying to spin an onchain 'gacha' machine for the chance to win a randomly selected NFT backed by Ether.

Within four days of launch, FWAs guzzled so much Ethereum gas that they briefly became the chain's largest gas consumer by fees over a 24-hour period. At its peak on July 25, FWAs generated approximately $1.53 million in daily fees, and even leapfrogged Tether and Circle to briefly rank among Ethereum's biggest consumers of blockspace.

Some critics, such as Simon Dedic, founder of venture capital firm Moonrock Capital, are skeptical about the long-term viability of FWA, arguing that much of the current activity is driven by generous token incentives rather than genuine demand. 'The whole thing is purely aimed at crypto degens so they can gamble and speculate,' he says.

However, others, like Meir Statman, a behavioral finance pioneer and professor at Santa Clara University, see parallels between onchain gacha and other forms of speculative behavior, such as bidding on the contents of abandoned storage units. 'These combine hope for riches with playfulness,' he notes.