The unprecedented impact of the COVID-19 outbreak has been inescapable. Several industries are now scrambling to adapt, with the global sports industry experiencing huge hits — events as big as the 2020 Tokyo Olympics have been postponed. Even when quarantine restrictions begin to ease, large scale sporting events are not likely to return any time soon, in order to avoid mass gatherings and crowds. As an industry that depends heavily on viewership, advertising, and live games, digital alternatives need to be invested in so that we can overcome these enormous obstacles to key forms of monetization.
While the popularity of esports surged in the early ’90s due to increased internet connectivity, the online gaming market is expected to grow in value to over $1 billion USD in 2020 — no doubt supported by those in quarantine. In recent months, we have seen the American Hockey League’s teams move to video gaming, MotoGP athletes continue racing virtually, and NASCAR video-game contests on ESPN. This is part of a growing esports scene, which saw a global audience of around 443 million people in 2019 and a growth of 12% from 2018 figures.
There has been a gradual shift away from traditional sports viewing models, which has been highlighted and intensified by the restrictions imposed by the current pandemic. Leveraging digital capabilities to maintain two-way conversations with fans, as eSports have, is the new priority. As with any innovation being heralded forward to solve a global challenge, blockchain technology can provide tangible benefits to the sporting world as it steps into a digital space. Facilitating a decentralized ecosystem for asset transfers and increased trust between participants will serve the gaming community well, elevating the industry to new heights.
The Rise of E-sports at an Enterprise-Level
Two tech giants, in particular, Facebook and Tencent, have their own approaches to cater to the booming demand for esports. Facebook Gaming was designed as a tool to support live gaming events and tournaments, while Tencent has expanded its interest in e-gaming by committing $262.6 million to Nasdaq-listed company JOYY to take control of Huya, one of China’s largest game live-streaming platform operators.
As indicated by a recent Digimind study, these companies join a rush of specialist gaming entities and broader technology companies looking to tap into the esports market, particularly in Asia. The report also detailed that global viewership on Twitch was up 10%, YouTube Gaming by 15%, and on the weekend of 22 March 2020, Steam recorded an all-time high of 22.6 million users. Once a niche online culture, esports has evolved into a global phenomenon that represents $71.4 billion in annual revenue in Asia-Pacific alone.
E-gaming in India
Ever since the Indian smartphone revolution, the popularity of the online gaming industry has soared. This surge can most definitely be attributed to the increased availability of smart devices and the accessibility of Wifi or mobile data. However, mobile games are becoming more skill-oriented than ever before, with today’s gamers finding themselves involved in high-investment genres, such as card-based or fantasy games. In the midst of lockdown due to the coronavirus, Ludo King, a multiplayer e-game, has become one of the top five most downloaded apps in India, matching other impressive apps such as Zoom and TikTok. Investments from companies like Nazara and Youzu have contributed to the country’s e-gaming revolution, with Alibaba backed-PayTM leading the way.
As it stands now, India is shaping up to become one of the biggest markets for digital gaming. Forbes reported an increase from 25 game development start-ups to over 250 from 2010 to 2018, and according to the India Post, revenue in the online gaming industry has doubled in less than 4 years. Demand has continued on an upward curve amidst the COVID-19 lockdown, with the Indian esports industry set to be valued at approximately INR 118.8 billion by 2023.
The role of Blockchain Technology
Professional esports has evolved as a viable career option for gamers. The introduction of blockchain gaming will undoubtedly revolutionize the ways in which gamers can acquire wealth, namely through allowing esports content producers to create in-game assets. The next chapter of the economic revolution could see gamers utilizing blockchain technology to leverage in-game rewards to acquire real ownership of digital assets, creating residual value for certain items and supporting opportunities for gamers to earn a living, just like a professional athlete. Blockchain projects, such as Decentraland, already recognize this potential, and now the onus is on the traditional gaming sector to adopt.
On the note of earning while you play, the utility of digital wallets will become crucial. For example, Refereum has partnered with Tron to share rewards with video game streaming users through the TRX token. This presents an alternative cash-out method for gamers that cryptocurrency-backed wallets, like that of Enjin, are built to facilitate. One can anticipate similar wallets to become increasingly popular as gaming cements its place as a lucrative industry.
In comparison to traditional online gaming systems, blockchain can provide a decentralized asset exchange, with the guarantee of security inherent in distributed ledgers. The Vinetree Corporation has rolled out such a blockchain platform that will provide access to social media dApps, a matchmaking peer-to-peer gaming platform, and a digital item exchange — essentially building a community for gamers to interact.
As the world of esports evolves during this pandemic, and indeed in a post-pandemic world, long lists of stakeholders will include players, game developers, sponsors, mass media, advertisers, sports managers, investors, and beyond. Blockchain technology has the potential to seamlessly bring all of these groups together on a decentralized platform, with the clear benefits of instant asset transfers, secure distribution of assets, and real-time micropayments to pay for sports viewership in a cost-effective way. Further to this, decentralized platforms will provide a transparent network for increased trust in gaming industries — something which the traditional model severely lacked and which is already being put into action by certain companies, including EX Sports in Thailand.
Decentralization has the potential to take esports to the next level by creating a sense of shared ownership amongst the sporting community, adding transparency and openness to a game that was once reserved for the elite. The instant trading of in-game assets unlocks the ability for even amateur players to build wealth, while the provision of a distributed ledger allows for the seamless communication necessary for sports to thrive during the lockdown. If blockchain technology is applied correctly, the booming field of online gaming and the renewed necessity for virtual sports can be truly brought to the masses quickly, fairly, and securely. It’s time for the sports business to level up and stake its claim in a socially distant, virtual world.
About CRUXPay
CRUXPay enables users to interact with blockchain-based systems with ease by allowing users to create human-readable IDs (CRUX ID) linked to their wallets. These IDs act as users’ identities in the crypto ecosystem, allowing them to send and receive funds, request payments, authorize payments, and link dApps with their wallets securely and seamlessly. CRUX uses the decentralized Blockstack Naming Service (BNS), which enables a unique identity management system. CRUX aims to bridge the gap between the wallets and the applications by establishing the ownership of a private key to a human-readable name.
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