The Next Evolution of the Gaming Industry
Why You Should Launch An Avalanche Subnet
Anyone who has followed the evolution of gaming since Pong in the 1970’s understands that few industries have had to develop and adapt as fast as the gaming industry. The pressure from technology and consumers to continue to push boundaries is ever present. Game studios have become multi-billion dollar organizations and have amassed gigantic playerbases who are eager to engage with their favorite gaming universe. There have been many setbacks and broken dreams in this fast paced world as studios continue to battle for the attention of gamers.
In recent years, gamers have begun questioning the ever-rising cost of their favorite form of entertainment, and it has become evident that they, the gamers, are as important in building game value as the games themselves.
User-generated content and skin customizations are now a standard that games need to succeed, and players are asking why downloadable content and loot box purchases need to be added on top of the original purchase price. In the face of an ever-worsening economy, a backlash like this has potential to become an existential crisis. As a result, studios are facing a reckoning and looking for the next innovation to fix a deteriorating business model and unhappy customer base.
Enter Web3.
The hype cycle around blockchain has come and gone multiple times, and as the space matures, interesting applications of the nascent technology continue to emerge. Crypto native gaming studios are embracing a new Play to Earn (P2E) business model, utilizing cryptocurrency tokens as a reward for in-game achievements.
2021 also saw the rise of Non-Fungible Tokens (NFTs), which essentially act as proof of ownership in digital economies.
Blockchain is the enabler of these new technologies, often referred to as GameFi, and it’s clear that this is the next frontier, the next innovation that traditional gaming developers and publishers will need to embrace.
Players will become stakeholders in their favorite gaming worlds, creating a new sense of ownership that will bring with it a new level of engagement. And for gaming studios, it’s not a matter of ‘if’, but ‘when’.
Multiple blockchain protocols exist today, each touting reasons why they are superior, usually to end up running into the same issues around cost, speed and scalability when any network momentum is achieved. Ethereum is the best known blockchain to build upon, but as the network grows, many users have been priced out as simple transactions can sometimes cost hundreds of dollars.
The Avalanche blockchain has developed a novel solution to the common issues by offering businesses the option to operate their own blockchain-as-a-service called a subnet. Subnets won’t be at the mercy of wider network congestion, common on all other protocols, and can even utilize their own bespoke native token, making the solution truly unique in this space.
For traditional gaming studios looking to make the leap into GameFi, Avalanche subnets are one of the best options available today and our current recommendation. Our partner, Wildlife Studios, is adapting their hit mobile game Castle Crush to become GameFi compatible, and will do so by launching their own subnet.
So… What is a subnet?
A subnet is a bespoke blockchain that runs concurrently to the main Avalanche blockchain network. While subnets maintain the security and scalability advantages of Avalanche, they are no longer subject to congestion or any other downsides associated with high network usage.
As subnets still operate on a proof of stake consensus mechanism, they require their own set of validator nodes. These can be run by the project themselves, or through the community-favored route of partnering with third party validators to embrace the important principle of decentralization.
Eden Network is one of many third parties available to provide the all-important network validation services, and we aim to be a simple yet robust solution to any new subnet launch.
Subnet performance — what to expect
In the age of competitive gaming, low latency is of the utmost importance. While it’s unlikely most of a game’s mechanics will operate on-chain, the elements that do need to function in as seamless a way as possible. Subnets operate with near-instant transaction finality and are never subject to any wider network latency. The more validating nodes on the subnet, the less chance of any downtime, putting the power truly in the hands of the operator.
When it comes to energy efficiency, Avalanche’s proof of stake consensus is several orders of magnitude more efficient than Ethereum and Layer 2 solutions like Polygon, due to their operational reliance on Ethereum’s network architecture.
Financial Benefits
Game studios will greatly benefit from the autonomy of GameFi economics; both from cost reduction and revenue generation standpoints.
For in-game purchases, merchant fees and platform commission are a thing of the past. Operators have full independence over pricing decisions; from items and services to transaction fees (generally used to incentivize validators). The immutable nature of blockchain also means that chargebacks are impossible — a further saving for operators.
New revenue opportunities, such as commission/royalties on secondary sales of in-game items, are common and easy to implement, making an expansion to blockchain gaming an easy financial decision for studios.
Superior UX
Core, the native Avalanche wallet, of which a public release is imminent, will greatly simplify UX/UI for onboarding and general usage — heavily criticized aspects of crypto that have yet to be solved.
Using Core, the Avalanche onboarding process becomes:
- Download Core wallet
- Connect to game RPC
- Get AVAX or subnet-native token (if required)
- Commence game play
Compare this to the typical user journey to play a game on a competing layer 2 blockchain:
- Download MetaMask wallet
- Configure layer 2 RPC
- Get ETH
- Bridge ETH from Ethereum mainnet to layer 2
- Swap ETH for game-specific token
- Commence game play
User onboarding has been a pressing issue for crypto for as long as the technology has been around. Multiple apps and projects have attempted to solve it, but so far without much luck. The Core wallet may finally be the solution to balancing UI, security and decentralization.
Who can access my subnet?
Operators have full autonomy over their subnet configuration. Whether they wish to make it completely private, transactions and all; permissioned so only approved users can access it; or permissionless like all public blockchains.
Scaling is never an issue, as even if one hundred million users are onboarded across multiple products on one subnet, simply creating a new subnets for each product is a few clicks away. And using Core wallet, cross-subnet transfers will be as simple as sending an email. This makes scaling theoretically infinite, fast and cost effective.
Operators also have the luxury of dictating who validates their network. To reduce the likelihood of downtime, Avalanche recommends a minimum of five validator nodes, however the decision is ultimately up to the operator. Some may choose to validate their own subnet exclusively, others may embrace decentralization and allow any validator that wishes to join their network.
Final thoughts
It’s clear that the gaming industry needs to adapt to the changing technology landscape, and with the use of blockchain, GameFi is the next evolution.
There are many ways game studios can enter the space, but authenticity and community are the keys to success.
Eden Network can help studios navigate this new frontier, from culture and marketing, to token economies and technical infrastructure.
Contact us today.
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