Why Unanchored Game Economies Are Structurally Bound to Fail

Abstract

This study investigates the structural inevitability of failure in unanchored game economies, which operate without intrinsic value or developer-enforced regulatory mechanisms. By drawing parallels with real-world fiat systems—where value relies on public trust rather than material backing—the research examines how such virtual economies, shaped primarily by player behavior and perception, exhibit inherent instability. Through case analyses of Diablo III’s Real Money Auction House and EVE Online’s player-driven market, the paper identifies key pathologies: inflation from unbalanced currency inflows, deflation triggered by sudden value reassessments, volatility driven by speculative behavior, and stagnation arising from decoupled gameplay and economic loops. These instabilities, it argues, stem not from mismanagement but from the core design of unanchored systems, where value is detached from labor inputs or systemic anchors. The findings conclude that unregulated virtual fiat structures face inevitable collapse without stabilizing mechanisms such as rule-based sinks, partial anchors, or gameplay-aligned economic loops, underscoring fundamental flaws in unanchored game economy design.