Are blockchains and NFTs the future of gaming?
Non-fungible tokens in the play-to-earn space are fast becoming the most popular form of NFT to own. To see this, you only need to look at the charts on OpenSea or Binance NFT, two of the most popular marketplaces to buy these gaming NFTs. They show the trading volume exceeding millions of dollars per game.
The trendsetter in this space is Axie Infinity, a play-to-earn game on the Ethereum blockchain. It was the first-ever NFT project to hit US$1 billion in volume, doing so in early August 2021.
What is causing users to buy into these games? What is the future of blockchain gaming, and the NFTs that are often needed to play them?
Andrius Miron is the CEO of Gamestarter, a blockchain gaming launchpad and fundraising platform, and head of Dark Frontiers, a strategy and NFT-based game that allows players to earn income in crypto. We spoke to him about Gamestarter, the future of blockchain gaming, and non-fungible tokens for gaming.
The idea of Gamestarter came from the desire to carve out a new space for indie developers, Miron said.
“As indie game developers, we saw the massive potential of fundraising in the crypto industry, utilising NFTs as playable assets and in P2E games that empower the gamers,” he said.
“We see the massive potential of gaming, it’s growing every year. Games as a concept have been around since the dawn of humanity, so it’s not going anywhere.”
As Miron points out, the gaming industry global revenue estimate has grown every year since 1998. According to analysis from Mordor Intelligence, the global gaming industry in 2021 was valued at USD$173.70 billion, and is set to grow by 9.64 per cent a year to reach a valuation of $USD314.40 billion by 2027.
“Indie game creators come with great ideas, but often lack adequate financing,“ Miron stated, and noted that these creators are “truly creating for the community and bringing something original.
“On the other hand, huge gaming studios that spend hundreds of millions and take years to develop the games are becoming too commercialised and boring. Just look at the most awaited game of 2021, Cyberpunk 2077.”
Cyberpunk 2077 is a multi-platform video game developed and published in December 2020 by CD Projekt Red. First announced in 2013, the game went through seven years of “development hell”, with the release date rescheduled at least three times in 2020.
Whilst the game was a commercial success, earning a profit almost instantly, the game was soured by widespread reports of bugs, glitches, and poor graphics, forcing Sony to offer full refunds for the game and remove it from its PlayStation Store for a while.
Blockchain gaming differs from the typical game development and publishing model, as the play-to-earn feature means that players have a stake in the success of the game, we asked Miron what that meant for fundraising and initial game offerings.
“By involving the community in the fundraising process, we let them share a part of our success. IGOs essentially are like the fundraising campaigns on Kickstarter, except they sometimes bring enormous financial benefits to participants,” he said.
“Some games have a DAO structure, where the community has a say in the development process. It really is a great feeling to be a part of something you feel passionate about.”
One of the major components of blockchain-based games are NFTs. In the case of Dark Frontiers, as with most blockchain games, the player needs to purchase NFTs that provide functionality allowing them to play the game.
In Dark Frontiers, players must own a “suit”; a spacesuit NFT that allows access to the virtual world, which, depending on the price, allows for between two hours to an unlimited amount of “oxygen”, or in-game playtime.
We asked Miron why some Dark Frontiers NFTs limit the amount of game playtime. “That’s to prevent players from exploring the first edition of the game too quickly,” he said.
“Also, the longer playtime gives certain advantages, like collecting more resources via gameplay which can later be used in minting NFTs or updating your gear.”
For industries that will be strong on NFT adoption, Miron answered that “social proof and blockchain-based social networks“ will pick up the mantle.
“Twitter is already developing a new verification system for profile pictures,” he said, “users simply connect their wallets and provide proof of NFT ownership.”
“NFTs that will stand the test of time are those with utility, NFTs from games that players love, historic NFTs that represent the shift in technology, and NFTs made by notable artists.”
The cryptocurrency space has always moved quickly, and with the hype of Web3.0, the community is already discussing “NFT 2.0”, the next stage of tokens allowing for greater customisation and utility, something the gaming industry is keen to pick up on.
I asked Miron how Gamestarter will adapt the NFTs for Dark Frontiers, and the NFTs for games on their platform, and questioned if blockchain games could ever move to consoles like Xbox or PlayStation.
“I think we already need to talk about NFT 3.0,” he said.
“This technology improves fast and has amazing potential. Gaming is just the beginning. Of course, we will follow all developments and deliver what’s needed for our community.”
On console adoption of blockchain games, Miron said this was a definite.
“Even banks are adopting blockchain technology, and gaming will follow. It is clear that NFTs are the ultimate tool to unlock value transformation in the digital era.”
“As we see the increase in high-quality blockchain games, the expanse of the infrastructure built to support blockchain gaming and hence the growing following of gamers, the shift will happen naturally.”
On pushback from the community regarding NFTs, and how game developers could bridge the gap, Miron had this to say:
“The pushback is mostly related to the negativity surrounding cryptocurrencies. People don’t see the technology behind it, so instead they focus on the financial aspect – instability, volatility and so on. At the end of the day, it’s just a good tool, it’s all about how you use it.”
“The best way to bridge the gap is just to keep creating quality products that feature NFTs with proven utility.”