Blockchain and Rabbids: The Gamification of Charity on Ethereum

Charity has been one of the growing use cases of blockchains explained by the ability to transfer funds worldwide at a low cost with fast transaction finality (often less than a few minutes). The recent collectible campaign organized by UNICEF and Ubisoft illustrates a new trend toward the gamification of charity through the use of blockchain technology.

Gamification is the application of elements of games (e.g., point scoring, competition with others, rules of play) to other areas of activity.

Gamification can encapsulate multiple industries but traditionally has been primarily used as an online marketing technique to foster a higher engagement rate with services and products.

This case study discusses how blockchains and gamification were used in a charity operation co-jointly run by UNICEF and Ubisoft, an in-depth technical explanation of the blockchain & its underlying standard used, the direct outcomes from this charity campaign, and the indirect benefits from the perspective of multiple stakeholders.

Finally, this case study closes on a discussion regarding whether gamification through the use of distributed ledger technology could become a new standard for global charity and our recommendations for future charity campaigns on blockchain networks.

1. Description of the campaign

UNICEF ("United Nations Children's Fund") is one of the world's largest supranational organizations globally. Its mission is to “advocate for the protection of children's rights, to help meet their basic needs and to expand their opportunities to reach their full potential”.

Since 2019, UNICEF has been pioneering blockchain use cases by accepting donations in a wide range of cryptocurrencies, such as bitcoin, ether, and a variety of ERC-20s (stablecoins or not).
Ubisoft, one of the highest revenue European video game companies, has recently set up a blockchain division within its dedicated innovation labs ("Ubisoft Strategic Innovation Lab").

In June 2020, UNICEF and Ubisoft made the news when they co-launched a charity campaign centered around the theme of Rabbids, which are known to be popular characters appearing in video game series like Rayman (Ubisoft) and some Mario games (Nintendo).

For this charity operation, (some) Rabbids have been tokenized as collectible items that can be received to raise money for UNICEF's set of charity initiatives. To do so, they deployed two contracts on the Ethereum public blockchain.

2. Technical implementation

Regarding the technical implementation, multiple functional elements must be considered: the blockchain used, the underlying set of contracts, the restrictions and limitations, and the properties of the items.

2.1 A set of ERC-721 contracts on Ethereum

As a start, Ubisoft deployed the first contract on the Ethereum public blockchain on April 10th, 2020. This created a token named "ERR" with 5 units being minted. Following this, a second contract was deployed an hour after. However, this charity campaign was officially kickstarted as of June 17th, 2020, following a set of tests, as illustrated by on-chain transactions taking place between the two dates.

There are two ERC-721 tokens used for this charity campaign:

• Rabbids tokens — With only 5 units, each of them represents one of the unique collectibles. These come from five distinct collections named (1) Diamonds, (2) Sunrays, (3) Stars, (4) Dots, and (5) Waves. A distinct property, tokenId, references them in the ERC-721 contract.
• Rabbids Proof-of-Plausible-Ownership tokens — Each of these tokens ("POPO tokens") is minted whenever a new Rabbids is transferred to an externally owned address ("EOA"). They can only be minted once per address and unique Rabbids for each of its evolution stage. There are 11 forms per token, resulting in a combination of 55 POPO tokens that can be collected per EOA. Each new "POPO" token is minted and added to on-chain data storage mapped with an address owner.

Figure 1 - Examples of illustrations of the campaign from the website and matching on-chain elements

Source: Etherscan.

Figure 2 - Required functions for the ECR-721 interface

- balanceOf(address owner) → uint256 balance
- ownerOf(uint256 tokenId) → address owner
- safeTransferFrom(address from, address to, uint256 tokenId)
- transferFrom(address from, address to, uint256 tokenId)
- approve(address to, uint256 tokenId)
- getApproved(uint256 tokenId) → address operator
- setApprovalForAll(address operator, bool _approved)
- isApprovedForAll(address owner, address operator) → bool

Source: ERC-721.org

Yet, despite the widely reported coverage by media that the collectibles were using the traditional set of ERC-721 token standards, the contract does operate quite differently than conventional ERC-721 tokens.

2.2 Unique additional on-chain properties

As of writing, the set of contracts had not been verified by the developers, who had not provided the collection of ABIs and the source code in a high-level language like Solidity, making it less straightforward to analyze from an external standpoint.

According to Ubisoft's official documentation, the following set of characteristics was integrated into the set of smart contracts:

• A peer-to-peer steal-able system — Each of the 5 Rabbids tokens can be "stolen" from its current owner whenever a user pays the required fee to obtain the desired Rabbids. In contrast, most NFTs cannot be retrieved from other user wallets directly. Still, they can either be sent from one address to another or sold on a dedicated marketplace (e.g., OpenSea, SpiderDEX). The history of token transfers can be seen here.
• Transfer restrictions — For (1) Proof-of-Plausible-Ownership and (2) Rabbids tokens. The enforcement of transfer restrictions is intended to prevent secondary markets' creation for these collectibles. In contrast to other popular Ethereum-based collectibles (e.g., CryptoKitties), the previously discussed nabbing mechanism is the only way to transfer Rabbids tokens from one address to another. Conversely, the POPO tokens are also immutably marked to a wallet and cannot be transferred.
• NFT minting process  — Whenever one of the 5 Rabbids is sent to a new address, the contract mints a "POPO" token on this address. This minting process is done if the current combination of (1) token ID and (2) current level has not ever been in the wallet.
• Evolution of the Rabbids level tokens  — Rabbids tokens evolve as their attribute changes. The evolution of the token level is done on-chain based on a change in the on-chain storage.

Figure 3 - Relationships between storage on Ethereum and token characteristics on the front-end interface

• A distinct real-time price logic for each NFT token is based on their ongoing characteristics  — The price evolves as a function of the token generation, with a price set between 0.05 ETH and 0.15 ETH. The logic to determine what will be the price seems to be built on-chain on the Ethereum blockchain.
• Other parameters such as "special power attributes" and the "cuteness power" are incorporated for both POPOs and each of the 5 Rabbids tokens.

2.3 IPFS-based and Web3-compatible front-end interface

Visuals are imported from the InterPlanetary File System ("IPFS").

Each of the on-chain token links to the storage link on an IPFS address. For instance, the below figure represents the associated storage link on IPFS and how it reflects on the front-end source code.

Figure 4 - Screenshots of IPFS integration on Ethereum and in the front-end source code

This integration with IPFS is tied to both Rabbids and POPO tokens, with their respective designs referenced and hosted on IPFS. This effectively allows immutability for the visuals, making them not dependent on any central storage system (e.g., AWS, DigitalOcean).

Ubisoft used a dedicated subdomain called “ubipfs.ubisoft.com” to retrieve information about each of the visuals displayed on the website along with other relevant characteristics of the tokens (e.g., “level”).

However, since Ubisoft engineering teams did not publicly verify the contract, it turned out impossible to display NFTs on most blockchain explorers like Etherscan or other competing Ethereum explorers. Hence, the visualization of the collectibles (i.e., cartoon images) remains primarily available on Ubisoft’s self-hosted front-end.

Interactions between end-users and Ethereum are conducted on the Ubisoft’s dedicated subdomain for this event, through the use of the Web3 set of libraries. In this case, Ubisoft has set some connectivity by running a client(“gethclient”) with a WebSocket hosted under “wss://mainnet.geth.ubisoft.com”.

Figure 5 - Screenshots of the Web3 integration on the front-end through a geth client Users can interact with the page using a wallet like MetaMask or other similar crypto wallets directly in their browser.

3. Evaluation of the direct impact of the campaign

To evaluate the direct impact of this charity campaign, co-jointly run by UNICEF and Ubisoft, three core areas are assessed: the total funds being collected, the number of participants (and the number of “POPO” tokens), and other on-chain metrics resulting from this operations.

3.1 Funds collected

A mere 35.83 ETH had been raised as of August 1st, 2020. At the current rate of ETH/USD (~ $345), it represents roughly $12,360 collected.
Regarding the breakdown per token, there are some disparities, but overall, each of the Rabbids tokens raised at least 6 ETH.

Figure 6 - Amount raised for each of the Rabbids tokens as of August 1st, 2020 (in ETH) Source: Etherscan.

The median transaction fee to acquire a Rabbids token (excluding gas fee) was 0.1 ETH, while the average was 0.105 ETH.

Figure 7 - Distribution of the purchased Rabbids token prices (in ETH) Source: Etherscan.

Most of the tokens have been purchased for 0.06 ETH. Some were even bought for 0.2 ETH, outside of the initial price range provided on the website (i.e., between 0.05 and 0.15 ether per token).

3.2 On-chain metrics

As of August 1st, 2020, 343 POPO have been minted, and the total number of unique addresses of participants was 154 unique addresses.

There have been 421 transactions involved (as of August 1st, 2020), including the operation to deploy the contract.

On average, the median gas fee was 0.01 ETH and the maximum gas fee per operation was 0.03 ETH (or more than 10 USD at the ether price of that day).

A transaction would trigger a set of 5 distinct events on Ethereum within the same block, explaining relatively these high gas fees for the operation to acquire a Rabbids and send funds to charity. Yet, these costs also tie to the increasing gas costs (on Ethereum) in the second quarter of 2020.

Figure 8 - Total gas fee paid in ETH relative to donation amounts Source: Etherscan. It includes data before the event was publicly announced (June 17th).

Interestingly, a large number of transactions seems to have failed, either with an “out of gas error” or “reverted” (discussed in later sections).

Figure 9 - Breakdown of transactions per final state Source: Etherscan. Data as of August 1st, 2020.

Figure 10 - Breakdown of timezones for Ethereum transactions Source: Etherscan. Data as of August 1st, 2020.

Finally, most transactions have taken place in UTC afternoon timezones (UTC 12:00 to UTC 23:59:59), typically indicating a bias toward Western hours. Since this charity game was only available in English and created by a video game company based in France (and with significant operations in North America), these numbers seem coherent.

This campaign does not have a definite end date, all these numbers are still expected to evolve over time. For instance, the upcoming unique "Moon Campaign" (August 3rd) might entail new participants.

4. Evaluating indirect benefits from this charity operation

The combination of charity and blockchains incorporated with a gamification reward process is an example of incremental innovation powered by public distributed ledger usage. It combines some primary characteristics of blockchains, such as immutability and transaction finality, while being public for anyone across the globe.

This gamified charity example is centered around the following benefits from each of the parties involved. We can observe these from four different stakeholder perspectives: UNICEF, Ubisoft, donators, and other participants in the crypto & digital asset industry.

4.1 UNICEF

From UNICEF's perspective, the use of the underlying technology powering blockchains relies upon three critical benefits:

• Transparency — Public blockchains like Ethereum allow complete transparency when it comes to charity. Since funds are sent to a dedicated address, it enables easy monitoring of the campaign's impact, allowing a precise segmentation of the outcomes from different campaigns.
• Speed to raise — Compared to traditional fundraising, the process must be quicker to obtain the funds. As discussed in our article about some of the main innovations from Ethereum, the process of transferring funds between two parties is swift, with permanent settlement within a few minutes.
• Lower cost — Compared to traditional charity campaigns, the entire process was automated, and funds could be transferred independently without any required contact with a third party. Besides, Ethereum transactions are much cheaper than international bank transfers, which result in lower overall transaction costs (and subsequently a higher total amount being collected by charitable organizations). However, since proceeds were collected directly in ether, funds were potentially exposed to price fluctuations relative to a fiat asset (like USD). This risk could typically be prevented through the introduction of a set of Ethereum-based stablecoins like USDC, PAX, or BUSD.

Furthermore, this operation explicitly allowed the UNICEF:

• Targeting a specific community — In this regard, the crypto community was the prime target and represents a distinct target purposely from the broader objective for charity campaigns.
• Testing new channels to raise capital — Part of its commitment to integrating a broader range of options for donations, UNICEF had previously set up support for multiple cryptocurrencies such as bitcoin ("BTC"), moneroj ("XMR"), ether ("ETH"), ERC-20 tokens, and coins from multiple other distributed networks. This experiment builds on these early moves and will likely be part of a broader reflection on how charities operate in the "Internet era".

It is worth noting that the use of blockchains in charity might also conflict with existing benefits (of charity) such as tax-exemption for charity donators. Similarly, transparency could conflict with requirements for charitable organizations to analyze the source of funds since transactions are made pseudo-anonymously (the only identifier being the on-chain address used to trigger the contract and pay the associated fees).

4.2 Ubisoft

From the perspective of an international video game company like Ubisoft, such a campaign provides two core benefits:

• Positive branding — For Ubisoft, this operation allows them to obtain extensive media coverage while emphasizing their commitment to innovation through public blockchains. Ubisoft has been the first video game company to build a (simple) service on the public Ethereum network.
• Testing and developing blockchain capacities — Ubisoft teams can also monitor the impact of blockchain solutions for gaming items, with limited risks since this charity campaign does not match any paid offering. This experiment could pave the way for additional support of NFT elements into video games from Ubisoft.

Yet, the complex implementation led to high gas fees from the perspective of users owing to multiple changes in storage and other additional elements in the contract.
Ubisoft not only integrated with the Ethereum blockchain but also has stored the visuals for its set of Rabbids collectibles in IPFS. This could potentially signify the first step into a structural change in how video game items could become independent from a centralized infrastructure.

4.3 Donators

This unique operation has allowed donators to:

• Contributing to charity with cryptocurrencies — Crypto users (and other participants in the blockchain space) were, for the first time, incentivized to contribute to charitable causes using cryptocurrencies. It is likely that many individuals, part of the cryptocurrency community, would be more involved to donate to charitable causes, if this new means of action were to develop further.
• Obtaining a digital proof of participation ("Proof of Plausible Ownership") — Similar to receiving a sticker on a car for donating for a charitable cause, these collectibles can be seen as "digital badges" to signal their participation to a definite purpose.

Yet, these NFTs are not sellable on secondary markets, nor are the proof of past ownerships. Hence, it is quite unlikely that participants' interest would have been emanating from any financial reward standpoint. Also, only ethers are usable for this campaign. A vast range of supported currencies could likely be used in further implementations of such a charity operation, hence fostering greater participation from the crypto community.

However, one might argue that the opportunity to sell these financial collectibles would draw a much larger crowd of participants. Despite the extensive media coverage for this promotional/charity campaign, the total funds collected remain relatively low with a mere 35 ether (i.e., worth around $10,000) collected in roughly two months (as of August 1st, 2020).

4.4 Participants in the crypto & digital asset industry

The perspective of other crypto stakeholders must also be incorporated into this analysis.

This experiment, conducted by UNICEF and Ubisoft, has likely paved the way for the following:

• Greater interest in the potential of blockchain technology for fundraising — Distributed ledger technology re-invents how money is transferred across the globe, from an efficiency perspective both through cost reduction and speed. An operation like this brings mainstream visibility into some of the benefits of blockchain for the greater good.
• New gamification areas — Despite charity being a growing use case of blockchain technology, its gamification could further appeal to millennials, bringing new opportunities for charitable organizations to reach a broader target audience.
• However, realistically, benefits from this campaign remain small for the entire crypto industry. In contrast, Reddit launching two ERC-20 tokens could have a much more significant impact on blockchain adoption.

5. Conclusion: is gamification on blockchains the future for charity?

Despite this operation not being a financial success, it highlighted exciting features regarding how blockchains can be used for charity through a gamification process. Gamification is a growing trend in the numeric age, where the span of attention dedicated to a single topic is reportedly lower than ever before.

Blockchains offer transparency, speed, and cost benefits for charitable organizations. This case study illustrates that gamification could lead to new growth areas for charity through public distributed ledgers. To some extent, it represents the virtual version of collecting stickers for donating to a charitable action in the real world.
Yet, gamification of charity through the use of blockchain-based collectibles could raise a broader debate whether the incentives would be assigned adequately if these collectibles had being tradable on the secondary markets.

Whether the use of collectibles as a reward for participating could disturb the incentives related to why individuals decide to contribute financially to charitable organizations, collectibles for blockchain charity are more likely to become the immutable versions of a proof of participation. Hence, these initiatives are expected to foster greater blockchain adoption while leveraging public blockchain benefits to transfer units of value in the globe with a fast finality.

6. Final recommendations

The team from Flying Block has compiled a few suggestions that could be incorporated for future charity campaigns. They are summarized below.

This section briefly discusses each of these suggestions at the concept level and the technical implementation.

6.1 Recommendations at the concept level

From a conceptual perspective, we recommend:

• Provide an ending date to the charity campaign — Similar to regular crowd sales, setting an end date often leads to some "Fear Of Missing Out" ("FOMO") reactions.
• Allow a fixed range of prices to allow more users to participate. In this specific campaign, 5 collectibles can be purchased, but their prices are determined based on each of their real-time attributes (e.g., level). Since the range of donation fees vary from 0.05 ETH to 0.2 ETH (20 USD to 80 USD), the current system discourages smaller donations. A fixed system of purchasable items allowing a broader range of price tags should encourage participation from different users, with varying levels of income and crypto holdings.
• Accept stablecoin payment options to reduce price volatility for funds collected and allow higher funding options. From the perspective of a charity organization, it exposes them to the price volatility of ether. Adding a range of stablecoins (Ethereum supports more than $10 billion worth) to participate would mitigate this risk and offer new payment options from the users.
• Support additional languages to reach more participants. Since parties from all over the world use the Ethereum network, anyone can participate in this kind of charity operations. Yet, not every user is capable of understanding sufficient English to engage financially. The support for additional channels would significantly foster a higher participation rate.

6.2 Recommendations at the technical level

From a more technical fundamental perspective, we also recommend:

• Verify the contract and publicly provide the high-level source code (e.g., Solidity) and the ABIs to offer greater transparency for third parties to integrate the collectible visuals.
• Work with on-chain blockchain explorers (e.g., Etherscan) to stimulate the outreach. Since the visuals are solely supported on the Ubisoft dedicated website, it severely limits the interest of crypto users since they cannot visualize these collectibles onto their usual blockchain explorers to track their Ethereum wallets.
• Change restrictions to transfer tokens and simplify the code to reduce gas fees. Optimizing the process would result in lower gas costs, hence reducing overall costs for users and potentially resulting in better support. While some are afraid that no restriction on collectible items would lead to speculation on secondary markets, it is possible to lock the tokens until the end of the charity campaign to prevent impacting the donation process.
• Deploy contracts on side chains to cut transacting fees with the set of smart contracts. Currently, the Ethereum network is congested, with near historical high costs. Migrating the contract logic onto a side chain could help to improve the effects. With a median gas fee of 0.01 ETH, it represents nearly 4 USD as transaction costs that go to neither the charity nor is saved by the participant.

To participate in this campaign and support UNICEF, please visit https://rabbidstoken.ubisoft.com/