Being a gamer I played a vast number of games from classics like Pokémon on handheld consoles, Runescape to modern titles like the latest Call of Duty and FIFA. With all the games I have played trading, buying, and selling items is nothing new and seems to be a growing feature, with players exchanging items for in-game currency or equivalent exchange.
As the video game industry is around a 300 billion industry that is predicted to rise to 314.4 billion by 2026, so it was only a matter of time before blockchain technology entered the video game world. In recent years there has been a new breed of video games that have sought to optimise blockchain into one of the core foundations of the gaming experience from as early as 2017 and there is a growing number of blockchain and NFT games being created today.
For those that don’t know, Blockchain is often associated with virtual currency or bitcoin and is basically a technology that is used to record information whilst making it infeasible for the information to be changed, hacked, or altered. The system can be best described as a digital ledger of transactions and duplicated across peer-to-peer networks or computer systems within the chain.
In the gaming industry blockchain is already being implemented to some degree with various studios and developers to keep track of game assets and items. Now it has progressed to the stage where a gamer can earn their own unique non-fungible token (NFTs) or cryptocurrency through merit-based advancements in the game, which they may then convert to actual money.
In games that utilise blockchain, players have complete control and ownership of the digital assets they obtain and possess through gaming, rather than limited ownership they possess in traditional games where everything game related is still owned by the company under copyright law.
This means players have the sole rights to the content they own and purchase with no fears of it being taken away or accidently deleted by the developers. Players are free to trade and sell their assets with other players and across the game for real money and obtain more assets essentially allowing gamers to play to earn. With this control gamers can potentially establish a business within a game through the sales of game items or their own user generated content and legitimately make a living off playing the game, selling their digital content online through the game.
With the use of blockchain technology developers can establish a sort of decentralised gaming system model which sees the game economy runs on the blockchain system allowing for trading to operate on its own and not impacting the other game elements which are stored in a centralised server.
The benefit of this model is to ensure an increase in safety for transfers that occur within the game economy between players as the items in game are represented as digital tokens, help creating scarcity and prevent the occurrence of fraudulent acts. Currently games such as Decentraland and Axie Infinity use a decentralised gaming economy which sees the game built around the creative freedom of the players to buy, sell and play as they like within the based capabilities created by the developers.
While traditional games where developers have control of the rules of the game that players must follow and determine the future of the game, blockchain games let players have a more significant say regarding both of these matters. This allows for players to govern the game experience through a more democratic system through voting and suggesting the majority of the rules, mechanics or content changes in the game should 51% or more of the players vote for it.
Additionally thanks to the decentralised model as long as the game servers remain popular enough then blockchain games have the chance to never truly die especially when developers abandon it where it can be solely run by the player base. Decentraland is a good example of a player governed game where the player often vote on how the revenue of the game is distributed to develop the game, with the player experience revolving around the economy and the majority of gameplay revolving around the activities and quests set up by the player based in their personal game regions.
Given that new technology is often a source of scepticism for leading and dominating groups in an industry until there is a proven benefit as they don’t want to risk their position and success on a yet to be proven technology. This is even more so for the gaming industry which has been seen in its history with the transitions of technology with significant examples being those used in game platforms which saw the transitions from arcades to PCs, Consoles, Handhelds, smartphones and now VR.
This opens opportunities to indie developers, as they can gain traction in the industry through utilising technology like blockchain, allowing them to gain a foothold and its initial advantages before big competitors
Though blockchain technology is still a long way off from being a mainstream inclusion in game due to its relatively new existence and its unproven nature there is still an untapped potential which can be seen from the success and its implementation in the current blockchain games. Although the overall user experience may not be the smoothest and raises some security concerns when interacting with wallets.
However it does provide more security with regards to tracking transactions, providing security of asset data, whilst also offering the benefits to players in the form of increased governance and control with developers capable of achieving greater growth from players seeking to start business that they can tax and help them improve the game.
We at Oeconomy are embracing this challenge to help make blockchain gaming more user friendly and more convenient.
Author of the article: Christian Smith, Game Designer