Aavegotchi is inspired by Tamagotchi and features similar gameplay but in an on-chain manner.
In its lore, Aavegotchis are pixelated ghosts living onchain and are backed by the ERC-721 standard. Their value is determined by a combination of its intrinsic value i.e. the staked collateral associated with it and its rarity level, which is calculated via multiple factors, such as the rarity of traits, equipped wearables, and your interaction with it.
Because every Aavegotchi is essentially an NFT backed by staked collateral or interest-bearing tokens, it is a unique combination of Defi and NFTs and is one of the earlier Defi NFT games to have debuted.