How Crypto Is Transforming the Gaming Ecosystem

Felix Lutsch
Mar 28 · 5 min read

The following is a guest post by Felix Lutsch from Chorus One.

Coinciding with the launch of our Loom validator, we (Chorus One) recently published a comprehensive analysis of Loom Network. It covers the opportunity of crypto and gaming, with a specific focus on how Loom is positioned to enable a transformation of the gaming industry from a technological and strategic perspective.

In this post, I will focus on how crypto could disrupt the gaming ecosystem, an idea that is discussed in-depth in our analysis. In the coming weeks, I will further break down other central points of our research on the Loom Network on the Chorus One blog, namely expanding on Loom’s competition and the ecosystem, and their technologies and execution to date.

The State of Crypto and Gaming

We are strong believers in the transformational capabilities of crypto-powered incentives and do expect crypto technologies to transform all industries in the coming 25 years, similar to how the internet changed businesses starting in the 90s.

But this transformation is a slow process, which will be met with resistance from incumbents, especially in slow-moving and established industries like finance, healthcare, supply chain, etc. We believe that it is much more likely that faster-moving industries like media, music, social and gaming will be the first to adopt crypto at scale. The Loom team has also made this realization and is focusing their efforts on scaling decentralized social, and specifically, gaming applications.

When looking at what has happened in the gaming industry during the past decade, the first thing to witness is enormous growth that has catapulted video gaming out of its niche into the world of mainstream entertainment. Tournament viewership of esports competes with that of traditional sports broadcasting, livestreaming further increases the popularity of games and has created a new form of superstar, mobile games have made gaming accessible to billions of people who weren’t part of the market before, and so on.

Yet, we believe that the gaming industry still has room to grow, and crypto might be the missing puzzle piece to kickstart this expansion.

The Gaming Industry — Ripe for Disruption?

If we look at the big players in the gaming industry during the recent period of explosive growth, there are a lot of big names that managed to establish themselves: Blizzard, Ubisoft, Activision, EA, and Valve, just to name a few.

But did an actual disruption take place? Most of these companies have produced games since the early days of the gaming era. A few companies like Zynga and Rovio managed to break out and capture parts of the newfound mobile gaming space, but other than that not much has changed in the transition of the gaming world from the offline retail market to an internet distribution model.

Platforms like Microsoft (Xbox), Sony (PS4), as well as Android and Apple — in the mobile segment — have especially managed to wield outsized control over the gaming industry.

What is Crypto Changing in Gaming?

Crypto will bring some unique capabilities to the gaming market — expand it, change the gaming experience, and potentially shift the power away from corporations to gamers themselves.

Expanding the Market: without crypto, gaming business models require some type of bank account. In the first world, this means that children rely on their parents’ credit cards. Elsewhere, billions of people are unable to access large parts of the gaming economy because they are unbanked. With crypto, this barrier could be removed and, as we will see, different monetization models for game developers may emerge that weren’t feasible before.

True Digital Asset Ownership: instead of owning a representation of an asset on some game company’s centralized database, crypto brings real digital ownership with assets residing on a decentralized blockchain. In Loom’s case, game assets (NFTs) are issued on Ethereum before they move to the network’s PlasmaChain, where they can be traded and interact with games on the Loom Network at scale, all while assuring owners stay in control of their digital assets via Plasma Cash.

Native In-Game Economies: crypto allows already existing in-game economies to unleash their true potential. Instead of buying assets, skins, etc. from a centralized game operator who controls them, real cryptographically secured digital assets can now easily be issued by game developers and traded directly between players, an early example of this is Loom’s Zombie Battleground Marketplace.

Power to the Gamers

Exchangeable digital assets that exist independently of a game are key regarding the disruptive potential of crypto in gaming. They blur the border between games. It is now possible to carry over assets from one game to another. Ultimately, this enables a shift in business models for game developers by fully transferring monetization to in-game assets. This is essentially a natural extension of the huge trend of free-to-play games with in-game purchases (e.g. Fortnite) towards a fully integrated decentralized game economy.

The core realization in this context is that gamers decide which assets they value and in which world they want to use them. With digital assets residing outside of a centralized game studios database, you can imagine having different versions of a game (multiverse) with gamers deciding in which of these game versions (universe) they want to use their assets. This is akin to forking in the blockchain context, and ultimately it shifts the decision power to gamers themselves. Now, game developers are competing on whose assets gamers value.

Gamers extending and modifying (“modding”) their favorite games has always been a huge part of the gaming industry. An example is the “World Editor” in Warcraft III that brought “Defense of the Ancients” to life, adopted by two of the currently most popular games, Dota 2 and League of Legends. In this new paradigm, the original creators of the “Defense of the Ancients” map could have monetized their in-game assets, a powerful business model that crypto uniquely enables.

In the full thesis, we expand on these points and also cover the tools and technologies the Loom team is building, as well as which role VR could play in this context. We additionally recorded a short discussion on our analysis, which you can find on our YouTube channel. As mentioned in the intro, upcoming posts on the Chorus One blog will break down other central points of our research. Follow our social channels and subscribe to our mailing list to stay informed about these and other updates around Loom and staking on Loom’s PlasmaChain.


Loom Network is a platform for building highly scalable DPoS sidechains to Ethereum, with a focus on large-scale games and social apps.

Want more info? Start here.

Want to stake your LOOM tokens and help secure PlasmaChain? Find out how.

Fan of blockchain gaming? Check out Zombie Battleground, the world’s first desktop and mobile card game that runs fully on its own blockchain.

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Loom Network

🛸 The blockchain platform of choice for serious dapp developers — http://loomx.io

Thanks to Michael Cullinan.

Felix Lutsch

Written by

Research Analyst @ChorusOne. Editor @StakingEconomy. @FelixLts.

Loom Network

🛸 The blockchain platform of choice for serious dapp developers — http://loomx.io