[Interview] The Future Where Reality and Digital Intersect: ArcX's Creation of a Web3 Arcade World

On August 29, 2024, an exclusive interview with ArcX CEO Owen Tan and advisor Allen Chow took place at WebX2024. They discussed their unique project, ArcX , which combines arcade games and blockchain technology, its appeal and future prospects. (Pictured from left to right: Allen, Owen, and YY)

-: Please tell me about ArcX.

Owen Tan (Owen): ArcX is a company with over 10 years of experience developing arcade games. We have many years of experience and currently have about 1.2 million users for our web2games. 200,000 of those users are Japanese and we realize the importance of the Japanese market.

Our new project is innovative, combining our experience with blockchain technology. By decentralizing arcade games on the blockchain, we aim to provide users with new experiences and economic opportunities.

-: What kind of project is it specifically? Please tell me its features.

Mr. Owen: The biggest feature of our project is that it allows you to remotely operate actual arcade game machines online. For example, users can play popular games in Japan, such as UFO Catcher and Coin Pusher, from their smartphones or PCs.

These game machines are actually set up in factories and can be operated in real-time through high-performance cameras. Users can enjoy a sense of being on-site, as if they were actually in a game center, while remaining at home.

Our research shows that users are more satisfied with operating actual physical game machines than games recreated digitally. This 'real feel' is the strength of our project.

ー: How is blockchain technology being used?

Owen-shi: We position this system as DePin*, which means decentralized physical infrastructure. Users can not only enjoy the game, but also purchase game machines and become owners.

For example, suppose a user purchases a UFO catcher machine. The machine, while installed in a factory, is made available to players around the world. The owner of the machine can earn profits whenever other users play on their machine. This is similar to the concept of land ownership in blockchain games.

Furthermore, depending on the machine's operating conditions, the owner can contribute to block generation and earn additional rewards. This helps us construct a new economic system beyond mere gameplay.

*DePin: DePin is an abbreviation for 'Decentralized Physical Infrastructure Network.' It is an initiative to decentralize and optimize physical infrastructure in the real world using blockchain technology.

-: Please tell me how to use NFTs.

Mr. Owen: NFTs play an important role in our project. The ownership of each game machine is represented by NFTs, and specifically, 30 NFTs are linked to one game machine.

For example, suppose there are 30 NFTs tied to a particular UFO catcher machine. The holders of these NFTs can receive a portion of the revenue whenever the machine operates and generates profits. The profits are distributed according to the number of NFTs held, so the more NFTs a holder possesses, the more profits they can receive.

Additionally, these NFTs can also be traded on secondary markets. Popular machine NFTs may be traded at high values, creating new investment opportunities.

-: Please tell me about the blockchains and tokens you use.

Mr. Owen: Currently, we plan to launch the project on the Binance Chain. The reason for choosing Binance Chain is its scalability and broad ecosystem. Many users are already familiar with Binance Chain, which is another reason for our choice.

Regarding the token, as of now, we do not issue independent tokens. However, we are considering issuing a governance token in the future. This governance token will allow holders to participate in the decision-making process of the project. For example, there might be possibilities for token holders to vote on the introduction of new gaming mechanisms or changes to the profit distribution model.

However, we believe designing the tokenomics must be done very carefully. Our goal is to build a sustainable economic model without compromising the user experience.

ー: What is your view on the Japanese market?

Mr. Allen Chow (hereinafter referred to as Mr. Allen): The Japanese market is an extremely important target for us. There are several reasons for this.
One major reason is that arcade game culture is deeply rooted in Japan. Many of the games we offer, such as UFO Catchers and medal games, originate in Japan and are familiar to Japanese users.

Moreover, Japanese users account for about 17% of the total in our existing Web2 games, making it a crucial market. I feel that the understanding and enthusiasm of Japanese users for games are very high, and they also have the flexibility to accept new concepts.

Additionally, the level of engagement and spending power of Japanese users are attractive as well. According to our research, the annual average spending of Japanese users on Web3 games is about 2,000 dollars, which is about ten times the world average. Such passionate user bases are very important in enhancing the sustainability of projects.

On the other hand, I believe a cautious approach is necessary when entering the Japanese market. Japanese users have high demands for quality, and regulations are strict, so we plan to pursue gradual penetration.

Mr. Allen: Additionally, our marketing strategy for the Japanese market is planned to be developed both online and offline.
On the online front, we have already established a Discord community with approximately 4,000 members. Through this community, we plan to engage in direct communication with users and gather feedback to improve the project.

Also, we are planning collaborations with popular Japanese influencers and YouTubers. By having them actually play the game and broadcast it, we aim to reach a wide range of potential users. On the offline side, we plan to hold events and meetups centered in Tokyo.

–: Please tell me about the current project progress and upcoming developments.

Mr. Owen: Currently, ArcX is in the alpha testing stage. We are conducting tests in three markets—Japan, Taiwan, and America—with the collaboration of approximately 10 KOLs (Key Opinion Leaders) in each market.
We plan to release on four platforms: iOS, Android, PC, and Telegram's TON platform. The TON platform, in particular, is rapidly growing, and we sense great potential there.

Moving forward, we will make necessary adjustments based on the test results, aiming for an official release within the year. After the official release, we plan to focus on expanding the user base and enriching game content.
Additionally, we are considering allowing users to set up their own gaming environments in the future. This will aim to realize a truly distributed game center where arcade games can be enjoyed anywhere in the world.

ー: Finally, I would like to make a request to the readers.

Mr. Owen: Our project aims to build a new ecosystem that goes beyond a simple game. By utilizing blockchain technology, we want to provide not only enjoyment from the game for users but also the opportunity to become part of the ecosystem and gain profits.

Please do play the game and experience its allure. We would be delighted if you could engage with this project not only as a player but also as a game owner or an active community member, contributing to its growth.

We have a great vision of spreading the joy of arcade games worldwide, and sincerely hope to realize it together with everyone. We eagerly await your participation.

ArcX is a unique project that merges the allure of arcade games with the potential of blockchain technology. The experience of being able to operate real gaming machines from the app itself is interesting, providing users with new ways to have fun and economic opportunities. ArcX places importance on the Japanese market and is advancing its development with a careful yet strategic approach. Its growth and evolution are likely to continue attracting attention in the future.