GameFi and Traditional Games: What are the differences?
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We come back with a monthly report and informative ON-SIGHT. Despite crypto winter, VCs in crypto are still batting their revenue into new GameFi and P2E with NFT projects. It is not surprising traditional game companies are diving into new GameFi for expanding their business recently. Why do they make such decisions? Let’s dive into the differences between GameFi and traditional games this month!
ONBUFF project shares informative research articles on the blockchain fields mostly related to P2E and NFT on our medium to let our community understand better. Any of this information is not Financial Advice.
As GameFi continues to gain popularity, it’s critical to comprehend how they differ from traditional games. Blockchain technology has recently taken off in a number of economic sectors, encouraging innovation, promoting growth, and adding value.
The gaming sector seems to capture the most attention out of all the other sectors. By encouraging users to engage more with the blockchain rather than just speculating, gaming is a use case that encourages the actual adoption of blockchain technology. It promotes user acceptance and encourages design and development innovation in games.
Let’s examine the key distinctions between traditional and blockchain games in this article, as well as the advantages of GameFi and the function of IPs in gaming. Examples like Fortnite, Pokemon Go, Ragnarok Labyrinth… will be used as cases.
A Brief Explanation of Traditional Games and GameFi
Games played in the past are centralized, all data are stored on servers and the game producers can change any game-related data anytime; these are the traditional games. In these games. Also, everything, including characters, skins, weapons, and even game-related coding and experience, cannot be used in other games, it’s a completely independent world. Contrarily, in GameFi, ownership of a piece of the game is possible to be withdrawn from the game and transferred on the blockchain, such as Ragnarok Labyrinth NFT. Players can access rewards and in-game items from various cryptocurrency gaming projects, which have value in the real world.
Different ways to make real money are available to players in crypto Gamefis. A play-to-earn (P2E) model refers to this idea, in which players can participate in a variety of ways: play games and get properties, stake token/ game property to get a higher reward, trade in-game NFT to earn… All of these things give the gaming industry a brand-new feature and imagination: the interesting idea that players can earn real assets while playing games. People in some developing countries would play these Gamefis full time to make money and support their families, which is an interesting phenomenon.
Crypto Games versus Traditional Games
Blockchain games provide a blueprint of economics. Contrary to those in conventional games, in-game items and NFTs not only have real-world value but It is also possible to be used in other blockchain projects as well. In Fortnite and Pokemon Go, for instance, the money you spend on it will remain there forever. Contrarily, users can trade and sell in-game goods, such as on Opensea, Looksrare, and Magic Eden.
Additionally, users can frequently stake the game’s native tokens to take part in the project’s governance in blockchain games. It guards against corruption and makes sure the community is pleased with the game’s updates. In a blockchain-based game, each interaction is also recorded on the blockchain. It guarantees that the project is fair and transparent.
Traditional games can still provide greater consistency and scalability, though. Unfortunately, it is still not possible to build a complex game for a large player base on the blockchain. For instance, blockchain technology, for instance, is incapable of handling a massive game with over 110 million monthly players like League of Legends. It still needs to store most data on centralized servers but can put some properties on the blockchain.
Additionally, given that players of blockchain-based games still view them more as investments than entertainment, at least at the moment, traditional games can provide more excellent entertainment value.
Lastly, blockchain games are harder for most people to play because you need to have basic knowledge of a series of things: a crypto wallet ), knowledge of crypto transactions, gas fees, and initial investment to play.
Effects of blockchain on the current gaming industry
GameFis have drawn criticism, but blockchain innovations seem to be here to stay and have a bright future, as it makes it possible to actually own in-game items. It enables players to acquire genuine rewards. Blockchain gaming is the first in the entire sector to enable players to monetize their advancement without the assistance of outside parties. Most blockchain-based games are also decentralized and run by the community, which gives users more control over their favorite games.
The idea behind play-to-earn (P2E) games like Ragnarok Labyrinth is that players can engage in combat, rivalry, or task completion within the game. As they advance and succeed, they earn points or rewards that can be converted into cryptocurrency or even fiat money (on other platforms). Users can contribute to the game they are currently playing. On the other hand, the static model in traditional gaming makes games a “sunk cost,” meaning that players never get their money’s worth in terms of time and in-game purchases.
Nowadays, some people have expressed dissatisfaction with traditional game pricing as creators, publishers, and developers look for ways to profit by adding premium editions and upgrades. Blockchain gaming somehow offers a remedy for this. In-game tokens, or NFTs, are provided as a representation of value, which can benefit the creators and developers in a more efficient way.
In fact, not all currently played traditional games want to use blockchain technology, most still reject integrating blockchain elements, hesitating and doubting the effectiveness of putting assets on the chain. Or in other words, do players care that much whether their in-game assets belonged to them? Or they just want to have fun in games for the time being. This might be a controversial argument between GameFi and traditional games for the next few years.
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