Does Bitcoin In Gaming Make Sense?
The history of value transfer in games
There is a strong historical precedent to argue that value transfer has always been an integral part of what makes games fun to play. But, whereas games have evolved into the digital age, the medium of value transfer between players has not. This leaves an enormous hole in the modern gaming experience.
Let us take you back to 1549 when the missionary Francis Xavier arrived in Japan. Xavier is cited as the first westerner to introduce playing cards to the Japanese population. Like today, cards were predominantly used in gambling activities, and this was no different in ancient Japan. Eventually, all card games became outlawed by the Japanese Shōgun in order to curb the rise of gambling addiction. To get around these restrictions a new type of playing card was created —HanaFuda cards. HanaFuda cards, also known as “Flower Cards”, initially appeared to have no obvious rules or value, and seemed to only be used for decorative purposes.
With time, these cards became a dominant medium for illegal gambling activities in ancient Japan and can occasionally still be seen in use today. One of the most successful gaming companies in the world started off as a producer of these cards — Nintendo.
With the introduction of personal consumer electronic devices and computers, games entered the digital sphere. Nintendo quickly moved into this space releasing the enormously successful Family Computer known as the NES in the US.
Another big change was that traditional games often involved a medium of value transfer between players as an integral part of what made them fun — whether it be HanaFuda, Chess, Poker or simple Dice, these games were often played using cash as wagers between players. But whilst we had peer to peer physical cash for games in the physical world we now had no way to transfer value digitally in the same manner.
In the transition to digital media, this legacy of playing games to transfer value was still fairly strong and in early games we still saw this concept persist. However, as it was no longer possible to transfer actual value between players this notion was represented by valueless in-game tokens such as Mario coins or Sonic rings.
Eventually, the merit of collecting these valueless tokens wore off and games for the biggest part obfuscated the mechanics of just collecting coins and focused on different gameplay scenarios such as “leveling” up your characters or completing complex quests.
Then as the internet evolved, particularly through mobile platforms and digital payments, it became possible to transfer value in games once again. Though, value transfer was still not possible peer-to-peer, between players, mainly due to the centralized nature of early digital payments. Value transfer was therefore limited to in-app purchases, loot boxes, in game ads etc which arguably had a detrimental effect on gameplay.
Even before Bitcoin, there were attempts at creating open digital markets that would enable players to transfer value between themselves; one example is Second Life’s Linden dollars. Another example would be players trading Counter Strike skins on illegal markets. However, these attempts were either shutdown, short lived and/or faced regulatory hurdles.
The other major limitation to these attempts at creating peer to peer currencies or tradeable assets in games is the fact they were all game-specific. They had no value or use outside of the game in which they were acquired, and so a player’s resources and effort spent within a game were generally always trapped in that game.
With Bitcoin and the Lightning Network we now have a global currency that is both peer-to-peer and interoperable between games — analogous to the usage of gold or silver in early gambling and games.
So should we be integrating Bitcoin into all games!? Well maybe not…
It is important to remember that whilst early games were often used as a way to transfer value between players and to facilitate gambling, this was always an optional feature. Pretty much all gambling and non-gambling games can be and are enjoyed without any monetary transfer at all. That said, if the players wish to, they can enhance the experience by placing some bets/making some wagers between themselves.
For example, players can battle each other freely in a Street Fighter-style fighting game or a Fortnite-style battle and just enjoy the gameplay for what it is. But now, for the first time, they are also able to enhance their experience by streaming Satoshis between themselves!
This is not to say Bitcoin cannot be integrated into games that enable entirely new forms of player interaction and gameplay mechanics — games empowered by Bitcoin.
We believe the future of value transfer in games powered by Bitcoin is very bright. Expect more updates on our experiments in this space in the future.