Blockchain Gaming Booms as Cryptocurrency Realm Expands
With the cryptocurrency realm expanding, blockchain gaming is experiencing substantial growth, offering gamers worldwide an increasingly diverse array of choices for leisurely gaming.
According to CoinTelegraph, a recent Newzoo report indicated that the video games market is projected to reach $200 billion in 2022, marking a 5.4% year-over-year increase. Furthermore, the report highlights that the gaming sector attracts 3 billion players, a significantly higher number compared to the estimated 320 million crypto users globally.
So, you might be wondering – what exactly is a blockchain game? It’s a video game, similar to traditional ones, integrating elements that leverage blockchain technologies, including cryptocurrencies and non-fungible tokens (NFTs).
The majority of blockchain games utilize browsers and are developed using HTML5 and WebGL technologies, significantly expanding opportunities for browser game development. These games have revitalized browsers and simultaneously enabled integration with cryptocurrency wallets, allowing the withdrawal of NFTs to external marketplaces without regulatory limitations.
While early signs of gaming adoption within the blockchain industry emerged, such as CryptoKitties in 2017, the sector has notably gained significant traction in the last 12 months. Major gaming studios are now exploring the technology, particularly with the explosive rise of NFTs and the potential for lucrative earnings during gameplay.
NFTs, non-fungible tokens, are unique cryptographic assets stored on a blockchain. Unlike fungible tokens such as cryptocurrencies, NFTs cannot be traded or exchanged equivalently; they are non-interchangeable.
NFTs are also employed as in-game items within online games, providing proof of ownership for such items and delivering numerous user benefits, thereby enhancing the gaming experience.
CryptoKitties pioneered NFTs in blockchain gaming, leading to the emergence of more popular games where players can acquire in-game items, like cats, and have the option to develop and exchange them for cryptocurrencies. This trend has fostered “play-to-earn” (P2E) modelled games, allowing players to engage in specific games and earn rewards in the form of cryptocurrencies or NFTs.
P2E blockchain-based gaming attracted significant investor attention in late 2021, exemplified by Axie Infinity boasting over 2 million active users. At its peak, the token price surged above $150, propelling Axie Infinity’s market capitalization to over $9 billion.
Regarding the potential expansion of the P2E user base, Anton Link, CEO of Unitbox Protocol, remarked, “I believe that NFT blockchain games and the GameFi sector will be the principal drivers of the industry in the coming years – serving as a gateway for the mass adoption of new users into the crypto sphere through novel NFT-based DeFi products.”
Given its promising outlook, the blockchain gaming industry currently faces minimal competition. Due to its early stage, traditional PC industry competitors often perceive blockchain gaming as either incomprehensible or likely to fail. Consequently, smaller studios not yet competing with major gaming franchises gain significant early-stage development advantages. This extends to launching in-game economies that generate funds to sustain ongoing development of blockchain-based games without incurring debt.
Similar to gamers’ diverse preferences in traditional PC games, blockchain games aim to accommodate various tastes. They commonly feature mobile apps or operate via PC browsers, ensuring simple controls and user-friendly interfaces accessible to most beginners.
Regardless of genre, all blockchain games are developed and executed using smart contracts. In the realm of cryptocurrency and blockchain technology, smart contracts are applications or programs running on a blockchain. They facilitate numerous functions like minting NFTs, data storage, communication, graphic creation, computations, and even currency creation, making them perfectly suited for blockchain games and forming the core of P2E (play-to-earn) games.
Several ongoing projects within the ecosystem are making significant strides in the blockchain gaming industry.
One such project is Vulcan Forged PYR.
Vulcan Forged stands as an established non-fungible token (NFT) game studio, marketplace, and dApp incubator, boasting 10+ games, its own Dex, a community exceeding 100,000, and a top 5 NFT marketplace volume.
This marketplace operates on Polygon, Binance Smart Chain (BSC), and VeChain, designed for accessibility and ease of use. Vulcan Forged functions as a community-centric initiative, fostering world-class blockchain game development by supporting developers through incubation and crowdfunding programs.
Vulcan Forged serves as a comprehensive hub for blockchain game enthusiasts, offering access to popular games and an expansive NFT marketplace for buying and selling digital in-game assets. The entire ecosystem revolves around its PYR settlement, staking, and utility token. PYR, compatible with ERC20 and Matic/Polygon, serves as a cross-platform currency usable within the Vulcan Forged ecosystem.
From its origins as a small digital art NFT platform, Vulcan Forged has expanded into a multi-dApp platform, game studio, launchpad, and top 5 volume NFT marketplace. The company introduced its decentralized exchange, VulcanDex, with NFTs spanning multiple blockchains, mainly utilizing VeChain as the primary chain. Observing a substantial surge in users, the platform has facilitated nearly $3 million in NFT trading volume. Their AAA fantasy decentralized universe, VulcanVerse, backed by acclaimed authors and studios, achieved rapid sellouts and entered alpha gameplay stages.
PYR Token – $PYR, an ERC-20/Matic compatible token, enables access for the Ethereum community while employing a Layer 2 solution, resulting in minimal gas fees. It serves across all dApps and games within the Vulcan Forged ecosystem.
Within the Vulcan Forged dApp ecosystem, several utilities exist: users can buy/sell in the marketplace, stake in land plots or Titans, stake and farm on Vulcandex, hold to become a dApp in the marketplace, earn it by playing, or stake it to join the philosopher’s counsel. These are the initial primary functions, and $PYR drives the entire Vulcan Forged ecosystem.
Another notable project is Gala Games. It allows users to earn GALA tokens by completing in-game missions and milestone achievements. Players can create and trade NFTs in the game or on non-game-based exchanges to earn crypto that can be converted to other digital assets, including cash.
In January, Gala Games announced the final stages of launching its blockchain, GalaChain, aiming to overcome issues seen with Ethereum like high transaction fees and network congestion. The migration to GalaChain is anticipated to improve user experiences by reducing fees and enhancing gameplay speed.
The project’s unique selling point lies in the team’s extensive gaming experience and the plan to create multiple games. This diversification means the ecosystem isn’t reliant on a single game’s popularity.
Games within Gala Games include:
- Townstar: a cryptocurrency version of Farmville, where players manage farms and resources.
- The Walking Dead: Empire: based on the famous zombie comic series.
- Mirandus: an epic adventure fighting evil.
- Legacy: focused on growing a business through creativity.
- Echoes of Empire: a sci-fi mystery game.
And more games are in development!
Additionally, Gala Games operates its NFT marketplace, “Gala Store,” where users can purchase in-game items using GALA, ETH, BAT, or the native game token.
GALA, the native token of the Gala Games Ecosystem, serves various purposes: governance, rewards, in-game currency, and payments for Gala Store items.
Both these projects, Vulcan Forged and Gala Games, typify smaller studios obtaining substantial headstarts in development, securing investments and partnerships to pave the way for long-term success in the gaming and blockchain gaming sphere.
Regarding other blockchain games, a snapshot of the most played games in August 2022 includes Axie Infinity, a pioneer in blockchain gaming.
Blockchain gaming intersects with the metaverse.
The Metaverse is a digital reality network connecting users through social media, VR, AR, online gaming, and cryptocurrencies, essentially a virtual real-world. Transferable value through online digital currencies, including in-game currencies, plays a significant role here.
Decentraland is an open-world game within the Metaverse, allowing users to buy/sell territory, create unique items, and monetize content.
Land in Decentraland, a scarce digital asset, is acquired using an ERC20 token called MANA, providing ownership and control over virtual creations.
Virtual worlds attract more users, enhancing both leisure and work experiences. A traversable 3D world offers an immersive environment and community interaction.
Another significant project in the metaverse gaming sphere is The Sandbox.
The Sandbox aims to create a unique virtual world where players build, own, and monetize their gaming experiences using SAND, the platform’s primary utility token.
Players can participate in governance via a Decentralised Autonomous Organisation (DAO) using SAND, creating digital assets (NFTs) and creating game experiences using The Sandbox Game Maker.
The Sandbox aims to merge blockchain with mainstream gaming, offering benefits like true ownership, digital scarcity, monetization, and interoperability.
The goal is to create an immersive metaverse where players collaboratively craft virtual worlds and games without central authority. The aim is to disrupt existing game makers like Minecraft and Roblox by granting creators true ownership of their creations as NFTs and rewarding their participation with the utility token – SAND.
In the current game market, centralized ownership and control limit creator rights and ownership of user-generated content. This control also restricts players from fairly monetizing their creations. Furthermore, proving creative ownership amidst content copying and modifications is challenging.
The Sandbox seeks to overcome these limitations and promote blockchain adoption by constructing a voxel gaming platform. This platform empowers creators to craft, play, share, collect, and trade without central control, offering secure copyright ownership through cryptocurrency earnings (SAND).
Interest in both blockchain gaming and the metaverse will likely surge among gamers, investors, and companies in the coming years.
These projects represent just a few examples of studios making strides in an industry with boundless potential.
As of the beginning of this year, the market capitalization of blockchain games exceeded $25 billion and is expected to sustain or even grow further, especially in the context of blockchain games and NFTs, which have recently converged to create a new economic phenomenon, according to DappRadar.
However, despite its limitless potential, there are downsides associated with blockchain gaming, NFTs, and the metaverse.
Blockchain gaming projects are susceptible to hacks, as evident from the Ronin Bridge hack targeting Axie Infinity, resulting in substantial losses.
NFTs have also been targets of hacks, often due to weak security protocols on exchanges, resulting in potential asset loss and lack of recovery options.
Similarly, the metaverse, while poised to revolutionize various aspects of human life, presents its own challenges. The decentralized nature of the metaverse makes policing cybercrimes difficult, ranging from hate speech to other unlawful activities.
Addressing these challenges, especially related to security and cybercrime, will be vital for the growth of the industry, particularly the metaverse. Effective security measures and regulatory requirements are necessary.
Despite these challenges, it’s an exciting period ahead for these industries, and staying updated and involved can be immensely rewarding for gamers!
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