Web 3 Gaming; bringing mass adoption to blockchain tech
could gaming possibly bring mass adoption to blockchain tech and web 3
This is essay 1 of 4 for the BanklessDAO Writers Cohort
In the first half of 2022 alone, gaming NFTs were able to raise 4× as much capital as other NFT sectors.
Gamefi funding has seen a 175% increase.
Yet gamers detest it. Crypto and decentralization maxis believe it has a really good shot at bringing mass adoption to Blockchain technology, while opportunistic gamers keep milking the juicy gains it currently offers.
Web 3 gaming is pretty much an umbrella name encompassing terms like P2E, Play and Earn, NFT gaming, and even blockchain games.
To most, it is all a scam. Those who see the big picture keep striving to hit gold in this relatively new niche.
One which aims to bring the decentralized creator rewarding essence of web 3 into video games — which itself is a force silently looking to dominate the entertainment industry.
Video games had generated a quite impressive revenue of $146 billion in the first year of the pandemic, compared to the joint $62.7 billion by both the music and movie industries. Both had been hit bad by the pandemic.
Web 3 gaming could well be the missing link harnessing the endless possibilities of web 3 and Blockchain technology into video games.
This article aims to make a case for what web 3 and Blockchain technology has to offer to the crucial trio of games, studios, and content creators in the video gaming industry.
We would also be taking a look at the current trends in web 3 gaming, and how we got here while predicting possible things we could see become trends.
We would also highlight some key issues that would need to be addressed if we’re ever going to see mass adoption.
So fasten your seat belts, it’s about to be one hell of a ride.
What does Web 3 even offer the Video Gaming Industry?
This question has been repeatedly asked by gaming studios and gamers alike. While most studios have been wary of the environmental impacts of Blockchains and NFTs, the few who had given it a try were met with resistance from their communities.
Most of it could be attributed to the play-to-loot model as seen in most popular NFT games.
Players don’t want the feeling of being pawns in just another Ponzi game, making it all seem like a joke or just another technology for developers to siphon money from gamers.
For Gamers; true ownership stands to exist.
You stand to be able to trade your in-game assets. Say I as a person played Clash of Clans for the past 5 years, maxing out my base in the process.
The day I decide to call it quits, I leave behind all of my achievements. The time, money, and effort expended. All gone.
What if we adopt the concept already being used in NFTs by creating marketplaces where you can trade your in-game assets, unlike the traditional one-way marketplaces where you are stuck with items bought and not able to resell.
Watch me get way more invested in this same game both in cash and efforts knowing there’s even the slightest probability that I could get something in return.
My years of time, effort, and cash could still be salvaged. Not like I didn’t enjoy the game but that feeling makes it all worth it.
For Studios; they have all to gain with better revenue generation models. Again think of royalties as we already see in today’s NFTs. No more going down the old playbook of pushing irrelevant updates just to generate revenue. Any update we would be seeing would be pure innovation and nothing else. A win-win situation for all.
Velocity not Extraction — Arad
For creators who help spread the word about these games at early stages, they’ll get incentives in return.
This time, think about making YouTube videos or writing blog posts explaining Fortnite’s gameplay as early as 2017 and accumulating $fort tokens down the line.
You progressively become a stakeholder at the company you love and would do all you can to watch this game grow even more. Web 3 again in all of its glory.
At this point, some would go on to argue that while all these are innovative and pro web 3, some studios have tried to execute them without necessarily using blockchain technology.
I’ll say we still do need Blockchain technology.
Imagine game designers programming smart contracts that automatically update your in-game characters let’s say after a specific amount of logins.
Plus with Blockchain transactions being public. I mean you could see all the places the Fortnite skin you’re about to purchase has been. No tech does it better.
We aren’t here by chance
Now we know what web 3 and Blockchain tech could be for video games, let’s take a look at what’s happened in the past.
The most popular model of web 3 games were investment schemes.
With the play-to-earn model, players invest by purchasing an NFT and are then forced to log in daily. Games they most often aren’t interested in. The goal then becomes to get back their capital and take in some profits. Take out profits and watch the opportunists leave in their numbers. It happened with Axie’s gameplay and I daresay it would happen to 99% of games with unsustainable models as such.
Where are we Now?
We’re at this stage where everyone’s gotten out of the hype with the unsustainable play to earn models.
The current trend is VC-backed games making them free-to-play in a bid to attract actual gamers.
The funds are flowing in, we’re seeing more experiments and consequently innovation. We’re now having talks of Play- and -earn. Here, playing becomes the primary objective and earning is only an add-on. An optional one at that. The funds are here, the builders are at work and momentum is building. Even Axie is reinventing herself.
While it does seem like the revolutionary game is almost here, I bet it would take a few more cycles.
Worthy of mention is the free- to- own model being spearhead by DigiDaigaku, a 2022 supply project which ran from a free-to-own to $24,000 in a month.
They’re acting as factory NFTs held by a tribe of true fans who build along with the team. With those buying into it placing their bet on the team.
Afterall they released the NFTs for free. Unlike many others we’ve seen raise funds from land sales without an iota of game building experience.
Main game would most likely be free to play. This model might just be the sweet spot. Let’s see how it all unfolds.
I feel it’s an important step in the right direction for the ecosystem. This model succeeds and we could see more big web 2 studio explore blockchain tech and Web 3.
Forms of friction we currently have in the space are
User Experience
Scalability
Security
Sustainable Game Economy and Tokenomics design.
My 10-year-old kid bro would not go down the rigorous route of opening a crypto wallet just to play a game he doesn’t even find fun — Anonymous
A Peep into the Future
Building on Blockchain technology is new and relatively difficult, let alone a revolutionary game.
We’ll see more and more independent creatives get funded the web 3 way while building a community in the process.
Those who prove themselves would most likely go on to get extra funding from VCs to scale and perhaps bring on web 2 gaming experts in due time.
We would also continue to see more employees of big web 2 studios leave to come build and experiment in web 3. With their proven past, they’ll most likely get funded from scratch.
The Go-to Blockchain for Gaming
Current Blockchains at the forefront in terms of active user base even in a downtrend bear market are Wax Blockchain and Hive Blockchain.
Both have one thing in common. A game people do enjoy and play.
Wax with Alien worlds and Hive with Splinterlands.
Solana pretty much has a very good chance with its very low transaction fees and ever-active community. The question however is could the network adapt to × 10000 of its current TPS without downtime. Surely with time, it’ll get even better.
Upcoming Blockchain Sui by mysten labs poses herself as a better optimized Solana. Even more interesting is its optimization for gaming as seen on testnet. Bring it on mainnet and they just might have a good shot.
Worthy of mention are the guys are Enijin and ethereum scaling platform Polygon. A lot of others building silently too.
It would be cool to look back in a few years and see these chains still at the forefront innovating and bringing in the wider populace.
Game On
The race is on people, we’re early in the grand scheme of things and a billion users remains the goal.
Bet early and support your favourite projects and blockchains.
However, don’t get caught up in the game.
Think of them as the startups that they truly are.
It’s all an experiment and while experiment breeds innovation.
Many would fail and a few succeed.
Till we get that 1st revolutionary game.
It’s game on Anon. The future awaits.
References
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