Blockchain technology has dramatically changed our understanding of financial transactions, data storage, and secure, decentralised communication in a very short amount of time. Blockchain technology has opened up a world of fascinating opportunities for the gaming industry, one of the most lucrative and popular industries in the world, with ground-breaking inventions like NFTs and the Metaverse.
According to a new Dappradar analysis, engagement in blockchain-based games has increased by an astounding 2,000% during the first quarter of 2021, drawing in an amazing 1.5 million players globally. With blockchain gaming, technologies like Web3, the Metaverse, and NFTs have taken on crucial roles and given gamers real ownership of in-game goods.
Play-to-earn models are becoming increasingly popular as a way to take advantage of blockchain technology. But even with blockchain gaming’s profitability, there are still certain issues facing the industry. In order to determine whether blockchain games are truly decentralised, this Cryptopolitan guide explores the universe of these games in more detail.
What are games on the blockchain?
In order to fully comprehend blockchain gaming, it is essential to study the underlying principles. Blockchain technology is the fundamental foundation around which blockchain gaming is constructed. An autonomous distributed public ledger that functions without a centralised authority is the defining feature of this technology. Blockchain games differ significantly from traditional gaming, which mostly depends on centralised server infrastructure, thanks to its defining characteristic: blockchain’s intrinsic decentralisation.
The advent of non-fungible tokens (NFTs) marked the realisation of blockchain’s revolutionary potential in the gaming sector. Cryptographic tokens, or unique digital assets, are stored safely on a blockchain and are referred to as NFTs.
These tokens give players the ability to create unchallenged ownership rights over particular in-game objects, such character skins and exclusive stuff. Because blockchain technology is decentralised, NFTs are especially revolutionary because they give players total sovereignty and control over their assets. Additionally, trading and making money off of in-game assets is another area where blockchain’s versatility comes into play. Within the gaming environment, a dynamic marketplace is fostered by players’ freedom to swap assets with one another. Virtual holdings get additional economic value when these assets are sold for cryptocurrencies.
Perhaps the most distinctive feature of blockchain gaming is its ability to create a heightened level of connectivity between different games and virtual universes. Unlike traditional games, where in-game assets are confined to their respective environments, blockchain enables players to seamlessly utilize their assets across a diverse array of gaming experiences. This interoperability enhances the player’s gaming experience and opens up exciting possibilities for cross-game collaboration and asset utilization.
Blockchain game decentralisation
Curiously, despite the belief that blockchain technology will bring about complete decentralisation, there is a contradiction between the ideals of “trustless ownership” and “decentralisation” and the realities of developing games for the blockchain gaming industry.
The bulk of cryptocurrency games, in actuality, are better characterised as “partially decentralised” at most. Even though they may use the “Web3” moniker, many of them are actually still influenced by “Web2+” components. As a result, although game assets might be stored on a blockchain network, important elements like game logic, state, and storage are still kept off-chain on centralised servers. There are various reasons for the apparent difference between the ideal and the actual. First off, the primary constraint on blockchain technology in 2023 remains to be its processing speed.
Video games require a huge amount of transactions, more than blockchains, even Layer 2 systems, can handle at this time. CEO of Lattice Ludens notes that trying to create a fully on-chain game today is like trying to create a video game on a machine from the eighties. Complex on-chain game production is impeded by the inherent limitations of blockchain technology.
Moreover, in integrating blockchain into games to guarantee accessibility to audiences who are not cryptocurrency users, developers face a number of difficult trade-offs. This is an important factor to take into account because not all players are at ease sifting through the complexities of a bitcoin wallet. Some developers have created hybrid solutions in response to this conundrum.
The “Syncspace” concept, for example, was developed by Aurory’s development team to allow users to store their assets in Aurory’s custody, but yet have the option to move them into their Solana wallets if they want more control. Considering that not every participant is equipped to handle the intricacies of a cryptocurrency wallet, Julien Pellet, the technical director of infrastructure at Aurory, clarifies that “Syncspace” functions as the platform’s UX (user experience) strategy. By embracing this compromise, Aurory aimed to increase its market penetration and attract more non-crypto-native Web2 players.
Key developments in blockchain gaming
The general acceptance of blockchain-based games has resulted in significant revenue growth and the opening up of numerous potential for the blockchain gaming sector. These developments essentially mark the cutting edge of blockchain gaming, offering gamers new avenues for ownership, financial gain, and engagement while completely altering the conventional gaming environment.
1.Non-Fungible Tokens (NFTs): Originally introduced in the early stages of blockchain gaming, NFTs continue to be a fundamental component of the sector. Because of how important they are, even established gaming businesses are entering the NFT space. NFTs are essentially tokenized copies of digital or real-world commodities, ranging from music to art. In the gaming industry, NFTs are primarily seen as in-game accessories such as skins or gameplay objects that players may buy and actually possess, even when they are not in the game world. These assets are fully controlled by the NFT owner and have a monetary worth in the real world. They can be sold or traded for cash.
2.Play-to-Earn Models: Play-to-earn models have completely changed player incentives in blockchain gaming. Under this model, players participate in games with the possibility of winning prizes in the form of bitcoin. In addition to buying NFTs, players can produce in-game items by engaging in gameplay. For example, an individual’s asset accumulation increases when they obtain valuable in-game things like skins, cards, or virtual land. As a result, gamers have the chance to sell these assets for cryptocurrencies or actual money when their value rises. Play-to-earn games that have been successful include Thetan Arena, Gods Unchained, and Axie Infinity.
3.Gaming Economy Tokens: Games powered by blockchain technology have their own fungible tokens, which is a revolutionary aspect of the gaming economy model that has been made possible by blockchain technology. These tokens are available through external channels like as cryptocurrency exchanges and function as the in-game currency. They can be traded within the game environment. This method democratises access to in-game currency for all players by doing away with the need for in-game purchases. In-game assets become the property of the players instead of gaming publishers when blockchain technology is used in games. Players can now profit from their gaming time by exchanging their assets for fiat money or cryptocurrencies on public markets thanks to this revolutionary update.
Advantages of virtual reality gaming
1.Safe transactions within the game: The widespread availability of digital wallets such as MetaMask has allowed users to safely purchase and trade cryptocurrency tokens and in-game assets with virtual currencies. The safety of the important investments and assets of the participants is guaranteed by this improved security.
2.Gaming profiles that work together: Players are able to execute transactions with their cryptocurrencies in a variety of games with ease by using their distinct public addresses. Because of this interoperability, assets can move between multiple game worlds, giving players more flexibility and a plethora of new chances to use assets.
3.Complete possession of in-game items: With authentic ownership over their in-game belongings, players are no longer dependent on developers, who have the power to end a game at any time. Players are empowered to maintain control of the resources they have worked so hard to acquire.
4.Decentralization:Players have some control over decisions in blockchain games, which is a dramatic contrast to traditional games where producers make all the decisions. Even though it is only partially decentralised, players can actively engage in decision-making processes and affect how the game is played.
Downsides associated with blockchain gaming
Blockchain-based gaming systems provide some revolutionary advances, but they also present several difficulties that could make players hesitate.
1.Volatility of cryptocurrencyCryptocurrencies are often used in blockchain gaming as essential in-game money or assets. However, the unpredictability of cryptocurrency markets can cause a great deal of volatility, which can cause abrupt and unforeseen changes in the value of virtual assets. Due to market volatility, players who devote time and resources to these assets may experience unanticipated losses.
2.Security issues: To handle transactions and asset ownership, blockchain gaming mostly relies on decentralised networks and smart contracts. These technologies are not impervious to security flaws and hacker efforts, though. A breached smart contract puts players at danger of losing their priceless in-game currency or tokens, which can lead to monetary losses and privacy issues.
3.Absence of guidelines:There are currently no extensive regulatory structures in place for the relatively new field of blockchain gaming. An atmosphere where dishonest initiatives, con games, and dishonest behaviour can thrive can be produced by this lack of control. Gamers could run into dishonest initial coin offers (ICOs) or producers that make extravagant promises but fall short of delivering on them, which could be financially disappointing.
4.Speed and scalability: Blockchain gaming frequently uses networks like Ethereum, which are susceptible to speed and scalability problems. These networks’ restrictions can lead to slow transaction processing, higher fees, and less enjoyable play, especially during times when demand is highest.
5.Intricacy and learning curve: The complexities of blockchain gaming platforms, wallets, and transactions might be daunting for players who are unfamiliar with the technology. It can be difficult for beginners to properly understand topics like private keys, wallets, and gas costs, which could deter them from entering the realm of blockchain gaming.
In conclusion,Today’s cryptocurrency games are mostly best characterised as being at most “partially decentralised,” with crucial elements like state and game logic being kept off-chain on central servers. Blockchain games, however, have a lot of benefits. Through digital wallets like MetaMask, it guarantees safe in-game transactions; it fosters profile interoperability; it verifies actual ownership of in-game assets; and it introduces decentralisation, allowing players to participate in decision-making. Additionally, the development of uncommon and priceless in-game assets is made possible by the use of smart blockchain trac games, which enhances the richness and thrill of the gaming experience.