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To make wargems you will require travelgames. You need to defeat battles in the wasteland to collect travelgems.
Then you have to charge the gem in the Gem Shrine using power balance. Once it is 100% you can activate it and see what the results are.
War Gems are used in wars to attack the Nethereggs of other Kingdoms or when activated with + % experience, they can be used for \'xp-wars\'. XP-wars are sort of a trainingsession to make your creatures level faster.