NFTs in the gaming category have seen exponential growth in the past year, leading many to believe that it would potentially take the NFT market by storm. To illustrate this, Axie Infinity, one of the biggest players in the NFT gaming scene, has seen its all-time sales surpass US$ 4billion, hosting concurrently 2.7 million players throughout the globe.
Such an example, including many others, has spurred other gaming developers to pursue the NFT monetisation model not only to introduce Play-to-Earn plans (whereby players can earn cryptocurrency through playing said games), but also to allow them the opportunity to introduce blockchain technology into video games in general.
What can NFTs offer in gaming?
A fun and interactive way for patrons to earn money whilst playing
Axie Infinity, one of the earliest to implement NFTs in the form of gaming, would serve as the perfect example of what an NFT game could offer, especially to beginners. NFTs have seen their popularity mainly centred around the collectibles market, dominated by the ever-famous Bored Ape Yacht Club, where NFTs represented by a variety of caricatures of stylised apes could be purchased and traded in a marketplace.
NFT games such as Axie Infinity take that to the next level, not only allowing its players to collect and purchase “Axie Creatures” and trade them on a marketplace, but also to engage in player-versus-player engagements where Axie Creatures are pit together in a turn-based combat scenario. The emergent victor earns in-game currency in the form of “Smooth Love Potion”(SLP) which can be used for both purchasing more valuable Axie Creatures or traded in cryptocurrency exchanges.
NFT games not only allow players to enjoy their time playing a fun game but also to experience their hard-earned NFTs in a more interactive and practical manner, unlike other forms of NFTs.
A user-friendly introduction to NFTs and blockchain
Axie Infinity is also, in a sense, an enjoyable and engaging way of learning about blockchain technology with how user friendly it is. Inspired by “Pokemon”, Axie Infinity was one of the earliest to implement blockchain technology in a game with this format.
It introduces seamlessly common concepts of NFTs, such as a marketplace and how you can trade NFTs and earn on the side, as well as enlightening players on the larger ecosystem of blockchain technology. Axie Infinity requires its players to integrate their digital wallets into the game with some pre-loaded cryptocurrency. This provides a singular platform where individuals new to the concept of NFTs and anything blockchain-related could learn about it in a holistic way that covers its multiple aspects.
Challenges in penetrating the mainstream gaming market
Banning of NFT and blockchain-based games on Steam
Despite the growing success of NFT games financially, its adoption into the mainstream gaming industry remains to be seen, as heavy backlash from gamers and certain game developers has hindered its adoption into the market.
A recent development in this whole debacle of whether NFTs have a place in mainstream gaming has set the tone possibly for years to come, in that NFT games have been indiscriminately banned from Steam, the largest gaming marketplace for PC gamers, owned and run by Valve. This ban follows a statement by the Co-Founder and President of Valve, Gabe Newell, who mentioned his displeasure with not only NFTs but also the metaverse.
Per his interview with Eurogamer, he states that sketchy and illicit activity happening behind the scenes was found in some of the NFT or blockchain-based games previously hosted on the platform. This raised concerns over the nature of such games in general, citing security risks that plague the current NFT market as well as the volatility of the value of NFTs on marketplaces which may deter future players from participating, hence affecting sales on Steam directly.
Valve’s banning of NFT and blockchain-based games echo the sentiments of many mainstream gamers, primary consumers of the media who have voiced a nearly unanimous distaste for NFTs. They are either sceptical of what value it could bring to beloved established video game franchises or intrigued by the thought of implementing blockchain technology. They are, however, put off by the ideas of implementing potentially egregious money-making schemes into said video games, which is not a first for the industry. This can be seen in the microtransaction fiasco around 2018-2019, causing games that employed microtransactions in their mechanics to be review-bombed, effectively impacting their sales and earnings negatively.
Bridging the great divide
It is an understatement that the presence of NFTs in gaming has disrupted the gaming industry as a whole in a polarising manner. Game companies the likes of EA games and GSC Game World, the developer of the sequel to the cult classic Stalker series, have considered implementing NFTs into their games in an attempt to replicate the success of Axie Infinity and its ilk, much to the dismay of their fans, and to that they have retracted the idea in its entirety.
It is not the end, however, for any company wishing to introduce NFTs and blockchain technology into their works. Although NFTs in games may already see success in their niche and bubble in the gaming industry, much can be done to sway the thoughts and sentiments of prospective customers and patrons.
A new hope
The key to winning over the mainstream gaming market lies in dispelling the doubts and queries potential customers have towards NFTs, which would include proper authentication of in-game NFTs and the legitimacy of its sale as to prevent any fraudulent activity from happening, as well as to shape the economy of the NFTs within the game to be more stable as to avoid any spikes or plummeting in its value.
The NFT technology is arguably still in its infancy and has yet to explore its full potential in how it can be implemented. Innovation in how NFTs can be implemented in games could potentially drive up more interest in these games, such as connecting some real-world value to earned in-game items, as has already been done with Nike’s NFTs. Companies could invent new ways for NFTs to be interactable in VR/AR games, an aspect of gaming with high potential for growth as VR/AR games improve in quality, as seen with the success of games like Half Life: Alyx and Pokemon GO.
Should companies centre the policies around making a game that gives immense value to its players by rewarding them more, proving that “Play to Earn” could be considered as a legitimate way of earning a side income, whilst ensuring that players could earn in a safe environment far from predatory scalpers and scammers, it is entirely possible that sentiments surrounding NFT and blockchain-based games could change in the coming future. Whether NFTs and blockchain technology will continue to disrupt the gaming industry moving forward, ushering in a new age of gaming, or otherwise, only time will tell.