Blockchain technology has given rise to a new dimension that will change video games forever. Born from digital origins and still in its infancy, this dimension embodies qualities of both our digital and physical worlds.
Just as the physical world is governed by the laws of physics, this new digitally-derived dimension is governed by the laws of distributed computing and cryptography. It contains intrinsic economics that are governed by blockchain ledgers. Like the digital world, it is made up entirely of information, which can be freely and instantly constructed, modified, transported and repurposed at a granular level.
The unique combination of physical and digital properties form the essence of this new dimension, and it is what we believe will manifest the future of video games.
We formed Horizon Blockchain Games to explore this new dimension, and harness its potential in our new gaming experiences. But to fully understand its significance, we must first examine the history of our relationships with digital worlds and the assets found therein.
A Brief History of Digital Ownership
Since the earliest days of computing, digital ownership has played a purposeful role in the creation of compelling interactive experiences. Mario collected coins to gain extra lives. Link carried a sword to defeat his enemies. Years later, the advent of online gaming and shared virtual worlds added new levels of authenticity and emotional investment to digital ownership. Early MMOs like Meridian 59, Ultima Online, and Everquest pioneered peer-to-peer virtual economies in which players could buy, sell, trade and modify their assets. This new layer of computer-mediated interaction added a powerful new facet to online gaming. It tapped into our social compulsions to organize, compare, and understand ourselves through material ownership. As a result, rewards became even more thrilling. Losses, all the more devastating.
Almost simultaneously, digital assets were assigned real-world world value. In 2012, a virtual axe in Blizzard’s Diablo III sold for $16,000 USD. Chinese gold farmers began working 12 hours a day, harvesting virtual currency in World of Warcraft to be sold at online auction. In 2014, a battle between warring space armadas saw EVE Online players destroy a combined total of $330,000 worth of virtual starships.
We place irrefutable value on the digital assets we find emotionally and intellectually meaningful to our virtual lives. Lives that are, themselves, vehicles for exploring our most fundamental nature as a species. We invest time, money, and energy into amassing vast virtual estates, the gravity of which have attracted entire online communities, spawning digital playgrounds that command more of our time and attention than those in the physical world. Thanks to blockchain, however, our understanding of digital assets is poised to change.
The Treasured Illusion
Digital ownership, as we have come to know it, is largely illusory. The centralized computing environments that govern the value, ownership, and makeup of traditional digital assets contain proprietary biases that prevent players from ever enjoying the same full freedom of ownership that they would with a physical asset. Until now, digital assets like in-game currencies, equipment, vehicles, and land were merely licensed from their true owners: the game’s publishers. These borrowed goods could not be transported or utilized outside of their game of origin. They could not be modified beyond what the game’s designers allowed. Trading them on an external market was considered a violation of the publisher’s terms of service, and was punishable by bans and fines. Players were free to lead rich online lives and amass digital wealth, so long as it was never made relevant to the outside world.
At Horizon, we see a better way.
The New Blockchain Paradigm
Blockchain applications, or decentralized applications (DApps), are digital economies owned and operated by their participants. The open nature of DApps permits anyone in the world to modify, evolve or build with them. Viewed through a different lens, DApps can be seen as digital organisms with cryptography and economics woven into their DNA. It is through these decentralized systems that we can now have digital assets akin to those found in the physical world. A digital collectible card is now analogous to a physical one, in that it belongs to you and you alone. Its sale or modification is as real on the blockchain as it is in the physical world.
Blockchain video games are DApps that lead with the fundamentals that tokenized virtual items are owned by players and are treasured goods of value.
Tokenized items are not borrowed from a game publisher, nor are they ephemeral, nor do they exist in the silo of only one brand, game or account that players can’t even trade with friends. With DApps, it’s the opposite: blockchain games open up the ecosystem of a game’s virtual world and embrace asset ownership for players, trading items between players in secondary marketplaces, interoperability of those items between games, and a community’s ability to mod a game if it chooses. We’re talking about decentralizing video games down to their core — everything from their items, rewards and economy all the way to their source codes.
In decentralized video games, items are for play and reward.
When playing traditional video games, players collect items, purchase mods and coins, or participate in a game’s virtual world in some way. But, because traditional games are isolated and independent from one another, players’ items and achievements are left behind whenever they leave one world for another. Certainly, we wouldn’t expect to see Mario, or his raccoon form, appear in Fortnite. With Ethereum’s blockchain design, its massive grid network and deterministic virtual machine, however, all games can exist in the same world. This interconnected world opens up many new possibilities, such as collecting, purchasing and earning items from one game and then transferring them into another game. Blockchain enables one gaming network — or “dimension” as we like to say — that’s operated and shared by the community of players, where every game is born from the same origin, and all games live connected and federated together.
In the summer of 2017, we began our journey with one founding question: how will the advent of blockchain change the future of gaming?
These were our answers, which have since become our pillars for blockchain game design:
True Digital Ownership
Through the power of blockchain, we can now build a world where players retain every coin, card, and collectable beyond their games of origin. These digital assets can be held in crypto wallets, affording players permanent and absolute dominion over their digital estates, unlocking a universe of interoperable gaming and economic potential. As true owners, players are free to sell, trade, or augment their digital assets however they want.
By its very nature, decentralized infrastructure is protected from malicious actors and external influence. Many describe DApps as being “trustless”, in that users don’t need to exhibit trust in each other since the laws of the DApp itself govern every interaction. Players can maintain full privacy of their identity, and only identify through a pseudonym tied to their crypto wallet address where their game items reside. They engage with each other in competitive play where the rules are open to all, match history is deterministic, and every player move is cryptographically signed for authenticity. Moves are impossible to forge and breaking the rules is easily detectable. The provable fairness of the network supports the robustness and health of the DApp’s ecosystem and the value within.
Play To Earn
Through the power of smart contracts together with cryptoeconomic design, we can now give players the opportunity to participate in gaming experiences that generate and distribute digital assets based on their outcome. We can create worlds in which winning battles, completing quests, and defeating opponents award digital assets securely. Whether players keep the rewards, trade them, or sell them for cryptocurrency is entirely their choice.
Blockchain technology provides a standardized economic infrastructure for applications to build a network of players, goods and rewards. The interoperable nature of these systems affords players the ability to move between game economies with ease. In-game items, themselves a form of tokenized asset, can be traded and/or converted for other cryptocurrencies like ETH. Suddenly, all game economies can be connected, producing one massive, navigable ecosystem, offering greater network effects and value transfer between players and games. Gamers can play to earn currency in one economy and spend it in another.
The economic value and business model of a blockchain game reside at the protocol level. The game items are what have value, not the software licenses or subscriptions. This means that blockchain video games can be open source and that players can modify and extend the games they’re playing. Communities will evolve video games in ways never before seen, which means that the games’ original creators and the players will contribute to the ecosystem, participate in and benefit from the economies. It’s a mass collaboration in which everyone wins.
At Horizon, we make blockchain-powered gaming experiences for dreamers, futurists, and digital citizens. We’re on a mission to pioneer a new dimension of gaming that belongs to its players. We’re building a new platform for decentralized video games where players enjoy the freedom of privacy, true digital ownership, open economies, provable fairness, and the ability to earn through play.
We believe that blockchain technology has brought us to the start of a disruptive shift in modern gaming, and we’re only just beginning to understand its implications. Every facet of our understanding will need to be reevaluated, including user experiences, revenue models, cooperation, economics, social relations, standardization, content creation, ruleset management, and more. We couldn’t be more excited.
There’s a new dimension of gaming beyond the horizon. One where physical and digital playgrounds collide — a new gaming world that belongs to its players. We hope you’ll join us there.
- the Horizon team