In my previous post, I mentioned that I believe stablecoins are going to be the most valuable use case of cryptocurrencies moving forward, especially for developing countries with fiscal and monetary policy issues. However, in order for crypto to truly becoming mainstream, I also believe that it will need real world adoption through a less risky or high importance industry. For me, the gaming industry could be the gateway for crypto to go truly mainstream this cycle. The global video game industry is worth ~$250bn, bigger than both the sports and movie industry combined. Mobile gaming holds the largest share — over 40% of the revenue, followed closely by console, and then PC. Crypto has the capacity to disrupt the entire industry.
“Composability is to crypto is what compounding is to finance — Chris Dixon.
Not only will gaming be the reason crypto goes mainstream but it will also be at the intersection of AI and crypto. AI and crypto are perfect complements for each other. User generated content with NFTs to purchase in game along with tokens of the blockchain to earn income. These tokens could be transferred to other games on the blockchain, making it truly interactable.
Gamers are generally more tech-savvy and open to adopting new technologies compared to the general population. The gaming community’s familiarity with digital assets, virtual economies, and online transactions provides a fertile ground for integrating blockchain and cryptocurrencies. Furthermore, blockchain enables gamers to have true ownership of their in-game assets. Through NFTs (Non-Fungible Tokens), items, characters, or even parcels of land within games can be owned, bought, sold, and traded across platforms and games in a secure and verifiable way. This not only enhances the gaming experience by adding a layer of investment and strategy but also allows for an economy to develop around these assets.
Blockchain’s decentralized nature can provide a more secure and transparent gaming environment. This technology can help reduce fraud, secure transactions, and ensure fairness, which are common concerns in online gaming and transactions involving digital assets. The composability aspect of blockchain allows for the creation of universal assets or currencies that can be used across different games and platforms. This interoperability can lead to a more unified gaming experience and promote an ecosystem where developers can build upon each other’s work.
Additionally, cryptocurrencies and blockchain open up new avenues for revenue generation within the gaming industry. This includes play and earn models, where players can actually earn cryptocurrency through gameplay or contributions to the game ecosystem, turning gaming from a cost center into a potential income source. Blockchain also enables more community-driven governance models. Players can have a say in game development decisions, updates, and rule changes through decentralized autonomous organizations (DAOs), fostering a more engaged and invested community. Using cryptocurrencies for in-game purchases can reduce transaction costs and eliminate the need for intermediaries. This makes microtransactions more feasible and economically viable, which is a significant aspect of modern gaming economies.
As a student of the crypto industry, I also try to think of possible roadblocks that may cause crypto to fail to go mainstream through gaming or also to fail in its adoption as a decentralized stablecoin. For me, the industry needs to first consider where crypto will lie in the battle between an omnichain and a multichain future. For me, it is multichain all the way! The entirety of human endeavour and growth is posited on exchange / trade / commerce across domains. That’s the one thing what’s worked for us to not only surface ideas (driven by competition) but to also accelerate growth and productivity. Thus, multichain is not only the optimum way but also the inevitable way. People will always innovate away from the norm, and there will be value generated away from the norm. This will be followed by a normalising of the new value add into the fold of the norm; therefore, it is only inevitable: multichain is the way. It’s dictated by our evolutionary history that we’re aligned to growth via choice. No matter how much people debate around this there’s no future for an omnichain world. An omnichain world would take away the choice from the users as everyone would be forced into a foundational layer, which is against the ethos of crypto itself. Hence, even if Ethereum offers a ton of choice to begin with, there will always be value that’s being generated at or beyond the edges of its frontiers and there is never going to be an “omnichain” world.
This makes me think that thrilling games will be produced on different blockchains; however, they will be composable and gamers will be able to shift their tokens and games to different blockchains, thus, highlighting the composability notion that I mentioned at the beginning. Thus, while stablecoins are going to be the most valuable use case of cryptocurrencies moving forward, in order for crypto to truly becoming mainstream, gaming is the way to go!
