Blockchain technology is opening doors in the tech and gaming industries that would remain permanently shut without it. If you’re still unfamiliar with the term blockchain and the technology that underpins it, don’t worry – you’re not alone. After all, the word blockchain seems to be thrown around a lot these days and often in the wrong context.
It is commonly used interchangeably with the term cryptocurrency, but these are two entirely different entities. And, while the technology underpinning blockchain is rather sophisticated, the concept itself is relatively simple to grasp. Simply put, a blockchain is a method of storing data. It’s a distributed, decentralized database that anyone can access—a fully transparent, immutable public ledger.
Blockchain gaming takes advantage of this decentralized, shared data network to develop games that include items, currency, and in-game collectibles on the same blockchain, which brings a wide range of benefits to players. If that doesn’t make much sense right now, by the end of this post, you’ll have all the information you need to grasp what blockchain gaming is and why it’s an exciting new platform for both gamers, and developers. Let’s dive into it.
The Blockchain Gaming Industry
In 2021, blockchain-based play-to-earn game Axie Infinity took the world by storm. In August of that year, the game raked in a staggering $342 million; the following month, it reported earnings of $220 million. So, to say there is a market for blockchain games is an understatement.
What differentiates a blockchain game from World of Warcraft, Fortnite, or Call of Duty is how it uses different aspects of blockchain technology, such as cryptocurrency and NFTs, to enrich the gaming experience. Let’s use Axie Infinity as an example to drive this point home.
The game revolves around token-based creatures known as “Axies.” To play, one must collect, raise, breed, battle, and ultimately trade or sell them to other players. There are also two utility tokens in the game known as Smooth Love Potions and Axie Infinity Shards, both of which can speed up the game and are easily bought and sold.
Players can earn money by successfully raising, breeding, and battling their Axis, then selling them as they become more mature to players who want to skip the process you went through in making it that far.
The time a player devotes to a blockchain game is exchangeable for real money, as it takes time to develop the in-game items into things that people want to buy. That’s what play-to-earn games are.
A Different Approach to Gaming
It’s not all about money, though. What blockchain games offer that traditional games don’t is the player’s ability to truly own the items they obtain from the game. Suppose you are playing Fortnite, and you buy a new skin. That skin is only yours while playing Fortnite. You don’t own it, and there’s no way to use it anywhere else.
Token-based items obtained from blockchain games are the opposite. Once you have one, you can store it in your wallet to do with as you please – sell it, trade it, or gaze at it fondly.
Perhaps the wheels are starting to turn in your head as you see all of the possible ways this technology can enrich the gaming experience. If not, let’s dive a little deeper.
What New Features Does The Blockchain Bring to The Gaming Industry?
Blockchain is responsible for a lot of buzz in the media – and the buzz is well earned. It will be the foundation from which tech giants will create the metaverse. And it’s also what created cryptocurrency, which is responsible for turning people into overnight millionaires.
On that note, there is also a laundry list of benefits that it brings to the gaming industry. Let’s have a look at a few of them.
If you need a quick brush-up on what an NFT is, think about it like this:
Suppose you have a dollar bill, and your friend also has a dollar bill. If you trade your dollar for theirs, the dollar you now have in your hand is indistinguishable from the one you just traded away. Both are worth the same, and nothing makes either one unique.
Every NFT, on the other hand, is unique, and ownership is easily verified, which makes them a fundamental aspect of the digital economy and a core element to the appeal of blockchain gaming.
They make it possible for in-game items to have any value at all. And since they are stored on the blockchain, which is inherently decentralized, NFTs can be moved around and used anywhere, no matter the game or place they were acquired from.
As it is being marketed, the metaverse has the potential to be the next iteration of the internet. It can be thought of as a persistent virtual environment that exists even when users are not participating.
Blockchain gaming will heavily occupy the metaverse ecosystem. The idea is that with the foundation of the fully decentralized blockchain technology, the metaverse will be an interoperable virtual world in which games and other platforms operate within the same borders.
Players will be able to create an avatar and outfit it with items and gear obtained from other games or virtual shopping centers dealing in token-based goods and use them in different games and environments. It is like one big world filled with different games, commerce, and lifestyle possibilities that mimic the real world.
We touched on this earlier, but one of the biggest reasons people flock to blockchain gaming is its clear monetary incentive. Players in countries like Vietnam and Brazil use this game-type as a steady form of income.
Games like Axie Infinity and Splinterlands have already proven there’s a market for play-to-earn games. But as time goes on, we will see how well this game mode ages. Will major game studios jump on board and add AAA titles to the play-to-earn genre? Or will it remain as it is: an edgy use of modern technology to make money? Only time will tell.
By now, you should have a pretty clear idea of what blockchain gaming is and how it is setting the tone for the future of gaming and the tech industry as a whole. With companies like Facebook (Meta) and Microsoft leading the charge for the metaverse revolution, it seems like only a matter of time before blockchain gaming becomes the norm.