Did you miss a GamesBeat Summit 2022 session? All sessions are available to stream now. Learn more.
Working at Web3, I hear a lot of animosity from traditional gaming fans towards NFTs and blockchain-based games. just mentioning that a game studio is experimenting with NFTs can cause social media feeds to be flooded with a 140-character backlash.
Gaming fans are known for their passion and occasional emotional reactions to change, but the source of this angst is worth exploring further.
(For the purposes of this article, let’s define an NFT as a digital asset that uses its association with a cryptocurrency to track provenance and is also listed on a marketplace or in conjunction with a playable virtual ecosystem.)
In 2012, Electronic Arts (EA) was the most voted hated company in the world. They went on to win that award. and again over the past 10 years, recently losing out to the likes of Comcast and The Trump Organization. The main reason behind the low public opinion of EA was also the key to the meteoric rise of EA CEO Andrew Wilson: loot boxes. Loot boxes are essentially virtual slot machines that randomly provide game benefits and virtual items. In order to receive bonuses in the game, a player must redeem tokens in the game. (These are known as Gacha mechanics in Japan.)
At the start, players are given gifts and a large number of loot boxes. However, once players get deeper into the game, the rewards become incredibly difficult to acquire without serious commitment. That is, unless a player speeds up the process by using real money to buy credits (and with them, a digitally induced hit of dopamine). Similar companies like King and Zynga structured all of their product lines around this psychological skinner box.
The community consensus is that gaming used to be a system where a player owned the entire experience of a particular game at the time of purchase. Now, with downloadable content, loot boxes, and microtransactions, the gaming landscape has changed irrevocably. A game can be given away for free, but the developers will have locked the vast majority of the game’s content behind paywalls. There have been a number of iterations of loot boxes and microtransactions over the last 10 years and some players have grudgingly accepted the practice, but only when it is skillfully executed and does not affect the player experience.
Some unspoken rules have emerged from the gaming community:
- The content available with the initial purchase should contain the majority of the experience.
- Essential items should not be locked behind microtransactions.
- A Herculean grind, or any kind of boring and repetitive gameplay, shouldn’t be necessary to bypass microtransactions.
Doing it about the money
Even before the gaming market started creating virtual slot machines, players have always flexed their wallets in virtual worlds as a form of status and identity. In World of Warcraft, buying gold from outside vendors was so rampant that Blizzard introduced a wow token which allowed players to convert real money into in-game currency. Similarly, Eve Online has had plexus as in-game currency since 2008. Plex can be redeemed for game subscriptions. This has led Eve Online to employ not only one full-time employee economist for its virtual world, but also news headlines like those surrounding the $150K in-game heist.
This is not the first time that companies have tried to incorporate hard currency into massively multiplayer online role-playing games (MMORPGs). Games like Entropia Universe and Habbo Hotel incorporated money into their models and became famous for degenerating into neo-capitalist. cheated hellish landscapes. Roblox, the most successful inspiration for the current NFT gaming landscape, has had multiple scandals related to the rampant abuse of third-party game development of its platform.
Hope is not a strategy
How does this backstory relate to NFTs? The message is that NFTs in games are unavoidable. NFTs are the culmination of the gamification of commerce and digital goods built on an economic foundation built over the last decade.
The real question is not why there are NFTs in gamesbut How can NFTs add value to games? (as opposed to an additional cash draw)? Most NFT gaming companies lack any real gaming mechanics and instead serve speculators who take advantage of the cryptocurrency price and tokenized market cap waves connected to the platforms. The key rule for adding value to NFT games: The base game must be a truly engaging and collaborative experience where people are freely included, challenged and able to create a community.
With the exception of early open source indie games, gaming has never been a “pure” economy-free experience. World of Warcraft, for example, used numerous psychological tactics to attract players to get hooked on playing their game. When the players finally gave up, the World of Warcraft players would try sell your accounts for actual currency. When the fruit of a player’s labor can be correlated to real money, it adds an element to the gaming experience rather than detracts from it.
How NFTs can be used to improve gameplay and player status
NFTs are a tool for verifiable ownership, often fulfilling a primary need (and joy) for collection and status, but like all tools, NFTs can be used for both good and bad purposes. The market needs to develop games that provide authentic experiences to players while also offering compelling opportunities for players to earn NFTs that reinforce and enhance the gaming experience. Emerging technologies like AR + VR open up windows of possibilities for gamers to use their NFT items in the physical or digital world. The interoperability of NFTs and metaverse avatars is developing rapidly, allowing users the freedom to experience the game on all platforms.
The art of storytelling in games is transforming into a more interactive and comprehensive experience.
Currently, the metaverse platform the sandbox is creating an NFT ecosystem that will make it easier for people to create immersive games and worlds by turning the components of a game (the art, game mechanics, and animations) into NFTs. blockchain-based Sandbox game provides a decentralized gaming ecosystem that enriches extraordinary creators who develop assets and worlds through a tokenized economy. (Games that are not NFT like hytale they have a similar mission, but have no way to monetize their creator marketplace).
The effort to bring gaming and NFT together is entirely possible. I remember playing the first version of DOTA on Battlenet, which has now expanded into a multi-billion dollar industry. How long will it be before the first mass-adopted AAA blockbuster NFT game is produced? When such a title and community arrives, will the company remain within the ecosystem that helped it exist or, similarly to Rampagewill it branch?
The next chapter of NFT-based gaming, like the entire NFT industry, is currently being written, and the possibilities for creative disruption and responsible value creation are limitless.
Beaugart Gerber is the vice president of sales for geeneean augmented reality company that has worked with Disney, Redbull and Warner Bros. and recently implemented a project with The Sandbox.
Data decision makers
Welcome to the VentureBeat community!
DataDecisionMakers is where experts, including data techies, can share data-related ideas and innovations.
If you want to read about cutting-edge ideas and up-to-date information, best practices, and the future of data and data technology, join us at DataDecisionMakers.
you might even consider contributing an article yours!