After the hype for GameDev related to blockchain technology increased, we can see a surge and revitalization of the play-to-earn games industry. During the global COVID-19 pandemic, millions of new users have entered the gaming market seeking to monetize their gaming time, which speaks directly about the increased demand for the GameFi sector.
The introduction of cryptocurrencies and blockchain technology has turned games into a means of generating real income.
According to a DappRadar report at the beginning of the third quarter of 2021, more than 800,000 unique active players were connected to blockchain games, and even higher audience growth is expected by mid-2022.
The weighty argument in favor of crypto games is that traditional games tend to exist on a centralized platform, and if a game is discontinued or closed, in-game items will also cease to exist. The item itself can only be used in the specific game for which it was developed.
It is the developers and publishers who ultimately own the intellectual property of the game and its content. In terms of cash flow, this becomes a zero-sum game, skewed significantly in favor of the developers and against the community of game users who pay for the game and purchase the items.
In contrast, games using NFT and blockchain technologies offer a paradigm shift: from a zero-sum game to a positive-sum game where all parties benefit. This is because the in-game item can now be tokenized to have:
- Compatibility between different game ecosystems — the utility is no longer tied to one game/one use case; it’s cross-platform.
- Immutability, which ensures that the item will exist regardless of the state of the game in which it was created and prevents it from being tampered with or copied.
- True ownership, as the item becomes the digital property of the owner, with a permanent record in the blockchain, as well as the ability to freely trade or move the item at will.
Not only that, the current generation of NFT games has adopted a unique business model that accrues income to players on a play-to-earn model. This model rewards players who participate in the in-game economy and allows them to monetize in-game items and time for real, liquid cryptocurrency.