How to Combat In-Game Fraud with Blockchain Technology

These days games are designed to fuse into people’s real life so that the players can connect more to it, which ultimately enhances user experience. The trend of in-game economy is gaining popularity at a very rapid pace. In an in-game economy, real money is used instead of virtual tokens earned in a game.

As appealing as the idea of in-game economy is, it also invites scammers, item dupers, and fraud. This is when the virtual world has to fight off real monsters.

Following are the challenges that plague the gaming industry:

1. Duping: In this case, cheaters tend to duplicate items of rarity to dilute the value of the item, thereby increasing inflation. This is essentially done by injecting a bug in the game. As a result of duping, the in-game economy is sabotaged.
2. Fraud and cyberattacks: Identity theft is the most common form of fraud in gaming. Hackers may get access to credit card details of other players to purchase in-game items. There’s a need to defend the data since data is the new oil.
3. Unfair and complex revenue sharing models: Let’s face it: gaming is no more simply about recreation. People’s livelihood depends on it now. The stakeholders at stake in the gaming biz expect fair and direct distribution of dividends. The problem arises when platforms like GOG, Steam take a large percentage of the generated revenue. Oftentimes revenue doesn’t get clearance for many days before finally reaching the end user. The smaller studios and indie developers take a hit because of this.

The continuing centralised gaming architecture is based on fallacious management system. For instance, when a user enters his/her critical information it is stored in a centralised modus operandi which is under direct control of the gaming company. This means that this data can be easily manipulated. The user needs to put blind faith in the gaming company to store their data.

Blockchain, Distributed Ledger Technology (DLT), sounds like a promising solution to address the challenges of the gaming industry. Blockchain guarantees transparency, immutability, resiliency, security, eliminates third party needs, and establishes direct P2P connection. Doesn’t this sound ideal?

If blockchain technology is put into service in the gaming industry, it’d certainly improve the gaming experience by delivering transparency, accountability, swiftness. Blockchain aims to establish a decentralised gaming environment.

Let’s go over how blockchain has the potential to help eliminate the current issues associated with the gaming industry.

1. Managing ownership of in-game assets: Blockchain is a distributed database which holds official (true) record of in-game economy. It will store which asset is created when, by whom, all other meta data which lead to success of asset creation. It even accounts for updation/deletion of an asset. Duping would be out of question here!
2. Manage distribution of dividends: Blockchain empowers gamers to directly communicate with other users without any involvement of third party. Since the use of crypto is one of the primary use-case of blockchain: crypto tokens can be used to automate the in-game economy. Distribution of dividends can be automated through smart contracts.
3. Transparent gaming: Blockchain is tamperproof and auditable. These properties of blockchain make the system resilient to cyberattacks. Every player would have a clear picture of what is going on under the hood.
4. Payment processing: The advent of DLT has made instant, cross-border payments a reality without even involving any third party financial institution. This is done by establishing a P2P connection. The payment is processed in terms of crypto which is unique to every application.
5. Fast verification: The identity of every user is secured and immutable in the distributed database (blockchain). So each time a user has to contribute to the in-game economy, the identity is verified from the blockchain database.
6. Player brokerage: Users investing in players on the platform can share their winnings in a transparent fashion without any hassles.

The paradigm shift from centralised solution to a decentralised one has promised many desirable changes. Blockchain might be the new tech that changes the landscape of the gaming industry. The coming months and years will prove that to us. The gaming industry is a very dynamic one, and generally the most agile industry in terms of accepting new technology: be it virtual reality, augmented reality, or machine learning. Hopefully blockchain won’t be any exception.