Enter the Dream Machine

If I mentioned DMT, gambling, avant-garde aesthetics, and retro nostalgia, you’d probably think about Fear and Loathing in Las Vegas or the script of some random Joe Rogan podcast episode. However, this is about Sanko GameCorp. For those who haven’t heard about Sanko, they’ve been shipping many different products over the last couple of years. Some onchain games include Milady Tekken and SANKO (a UNO that allows betting with crypto), NFTs—Sakura Park and Streets of Milady, a native token – DMT (Dream Machine Token), and even a streaming/SocialFi app called Sanko TV on Arbitrum. At the same time, it created a cult-like following on Twitter and Telegram, rooted in the Milady community – but we’ll go deeper into the lore later on.

After months of teasing, they finally launched their L3 to expand their ecosystem further. It enables third parties to deploy onchain games with fees ten times cheaper than Arbitrum.

The Thesis is Simple

The thesis is simple, really

Arbitrum L3 Appchain Staking Powered Gaming Console Play To Win Play To Burn 1,000,000 Tokens Hard Cap 为生存而战 Miladys in Control

If you’ve been following them on Twitter for a while, you’ll notice there’s this recurring copypasta that starts with “The thesis is simple, really,” then followed by something somewhat related to the actual thesis, as in the quote above. And to be fair, it really is simple – a chain with their native token as the gas token, with a deflationary mechanism, multiple gaming apps, few competitors, and a cult-like milady-backed community that could result in the perfect flywheel.

Arbitrum Orbit L3

From a user’s perspective, nearly negligible gas fees plus a fast block time (< 250ms) make onchain interactions seamless and smoother than what one would get on L2s, which is relevant for gaming since you want speed and you also don’t want the end user to worry about spending significant amounts of money on every onchain interaction they make, making L3s ideal for gaming: low friction results in better UX.

For their tech stack, they opted for AnyTrust to handle their Data Availability (just like Arbitrum Nova, with their own Data Availability Committee) that settles on Arbitrum One. This was achieved using Arbitrum Orbit, which comes with all the benefits mentioned before (low gas, fast block time, and custom gas token), with the additional benefit that it also enables them to leverage Arbitrum’s ecosystem. For example, they managed to score a partnership with Camelot to provide their DEX on Sanko from day one, but beyond this, they can also tap into the DAO’s incentive programs. In the past, Sanko participated in the STIP, using 500k ARB incentives to support content creators on Sanko TV. Now, the DAO is pushing for a $200M gaming catalyst program to invest in games built on Arbitrum, including those using Orbit, so this should drive even more attention and capital towards Sanko.

Another thing to add here is that deploying an L3 using Arbitrum Orbit means that, once Stylus goes live, developers can write and compile smart contracts in Rust, C++, and other languages. This will make it easier to onboard Solana or even Web2 devs to Sanko with very little friction.

Simply put, the benefit of using an Arbitrum Orbit L3 is that these are faster and cheaper than using Arbitrum One, while at the same time leveraging Arbitrum’s community and tech stack, which is leaning heavily towards gaming.

Tokenomics

From a tokenomics perspective, having your token as a gas token (in this case, DM