Blockchain in the gaming industry 2020: Here is what you can accomplish
In this article, we are going to discuss Blockchain in the gaming industry that may lead to mass adoption.
Blockchain technology has the potential to create a new era of gaming and drive true adoption in the industry.
Blockchain technology has recently become a big tool in various areas of the economy, driving innovation, fostering growth, and bringing added value.
Among the most noteworthy of these sectors is the gaming industry.
Gaming is a use case that drives the true adoption of blockchain technology by taking the incentive for the user from pure speculation to transactions on a blockchain platform.
This drives innovation in development as well as consumer adoption.
But, blockchain is no longer just a tool for the gaming industry to utilize and incorporate, it has also become a market unto itself with several companies actively pursuing the creation of high-end gaming experiences based on a blockchain backbone.
Change in the gaming industry is not uncommon and blockchain technology is now the next or for some the latest, wave of disruption to the industry.
We will first discuss each industry separately and then explore the potential capacity of blockchain and gaming together.
Use of Blockchain in the gaming industry
Gaming Industry – The global gaming market was valued at USD 151.55 billion in 2019 and is expected to reach a value of USD 256.97 billion by 2025, registering a CAGR of 9.17% over the forecast period (2020 – 2025).
Game developers across emerging economies are continually striving to enhance gamer’s experience, launching, and rewriting codes for diverse console/platforms, such as PlayStation, Xbox, and Windows PC, which are incorporated into one product provided to the gamers through the cloud platform.
Market Overview of the gaming industry :
- The emergence of cloud gaming is driving the market.
- Recent advances in advanced cloud technology have turned the idea of cloud gaming into reality. Several companies such as Onlive, G-Cluster, StreamMyGame, Gaikai, and T5-Labs are already offering commercial cloud gaming services.
- This new sector is also seen as a serious competitor for the traditional game market.
- This has prompted video game majors such as Sega, Ubisoft, Epic Games, Atari, Warner Bros, Disney Interactive studio to establish partnerships with Onlive to distribute their games.
- Adoption of Gaming Platforms, such as E-sports, drives the market. eSports are witnessing substantial market demand in the current market scenario, and are thus driving the overall gaming industry across the globe.
- With the outbreak of COVID-19, home entertainment seems to be the only option for gamers in lockdown while cinemas and theaters continue their’ door-closed’ policy to prevent the disease.
- The March 2020 survey shows that video gamers in the United States reported that they spent 45% more time playing video games amid the quarantine than in the previous week.
- Esports is another emerging industry that manages to make more than a billion dollars a year.
- Now, after the pandemic, it has gained further traction. The increase in the first-time download of Twitch after the epidemic in March has risen to 14% in the U.S.A and a staggering 41% in Italy.
Blockchain Industry – The global blockchain market size is expected to grow from USD 3.0 billion in 2020 to USD 39.7 billion by 2025, at an impressive Compound Annual Growth Rate (CAGR) of 67.3% during 2020–2025.
The increasing need for simplifying the business processes and the need for supply chain management applications integrated with blockchain technology will drive the overall blockchain market.
The market growth can be attributed to the increasing number of venture funding and investments in blockchain technology and the increasing popularity of blockchain technology in retail and supply chain management.
Geographic expansion in emerging markets and large scale implementation of the blockchain technology offer significant opportunities in the market.
Emerging regions, such as APAC and MEA, offer several untapped and unexplored opportunities in the blockchain market
In this article, we will not discuss the coins (bitcoin, ether) and tokens(ICO’s), we will discuss the use case of blockchain other than crowdfunding.
Firstly we will do a SWOT analysis of Blockchain technology and later we will sync blockchain with the gaming industry.
- Transaction cost
- Potential attacks
- Gives back control to the user e.g. instead of Google and Facebook using your data, you can control who gets access to your data. All these permissions will be stored on the blockchain.
- The world is becoming more digital.
- Jobs creation
- Scalability issues: too many transactions (overload), although several solutions are present.
- Unwanted centralization: mining pools and large mining farms.
- Quantum computers (in the future) have the ability to decrypt data.
- Hype and fast-changing environment.
- There is always the possibility of mining attacks and hacks.
From the above discussion, we have concluded that there is a very high capability of blockchain technology, as we can see people getting more attractive towards blockchain technology due to lack of unavailability of features like immutable data, decentralization, in traditional technologies.
Potential gaming and blockchain together
Blockchain gaming, like most blockchain solutions, needs to be examined on its merits and picked apart on its flaws before it can be decided if it is the future of the space.
The growth of the blockchain gaming market also needs to be weighed on its potential to integrate, as well as overcome traditional hurdles.
Gaming assets are almost as important and valuable as tangible assets, the blockchain offers discernible proof of provenance of specific virtual items.
Moreover, the digital tokens from blockchains add huge payment benefits, especially useful for esports, creating native in-game tokens and driving seamless transactions on decentralized exchanges.
A key benefit of using Blockchain technology is the transparency it gives, decentralized gaming is set to depend on the exchange and investment of cryptocurrency, for example, the Playkey Token, and blockchain allows for all users to be able to exchange and trade worry-free.
As a rule, crypto transactions are easy-to-monitor even if they are not yours.
For example, one user is perfectly able to view the contents of a crypto wallet by only possessing the wallet address if the transaction was done under the smart-contract of the decentralized crypto exchange like EtherDelta, for example.
Another smart contract that is required to manage the rules of interaction between a miner and a gamer in a future Playkey decentralized ecosystem is also a transparent mechanism to guarantee a miner will get its reward once certain conditions within renting out its PC are met.
Overview and Market Trends of Crypto Games in 2020
The first true blockchain gaming application was Cryptokitties.
While the platform itself is a technology demonstrator for collectible items, it quickly rose to prominence as the application representing the majority of transactions made on the Ethereum platform.
Blockchain use cases in gaming are mainly constrained by the transaction capacity of blockchain platforms in the case of Ethereum.
Current blockchain applications in gaming, therefore, are experimental tickets, with collectible platforms and mobile games leading the pack.
Spotting the Potential of NFTs in the Blockchain Gaming Industry
“NFTs are unique and distinguishable tokens, mostly implemented on the Ethereum blockchain as ERC-721 tokens, which have individual traits and identities.”
What is NFT and how they are different from ERC20 tokens?
Non-fungible tokens (NFTs) are a form of a digital asset (or item) created using blockchain technology that are unique to the owner.
When these items are purchased or earned, they become the property of the owner (not the game or another 3rd party) and are written to the blockchain.
Till now, NFTs have gained the most attraction in the gaming and collectibles space, most notably with CryptoKitties, ERC20 tokens are not unique and cannot be represented as an asset.
The success story of NFTS
In December 2017, the blockchain-based CryptoKitties video game became so popular that it congested the Ethereum network, causing it to reach an all-time high in transactions.
In some cases, people reportedly paid more than $100,000 for a CryptoKitty non-fungible token, or NFT.
By March 2018, CryptoKitties had been spun off as an independent company that received over $12 million in venture capital.
“CryptoKitties has shown that giving users a personal stake in the creation of an NFT makes them more attached to them and more likely to value them highly.”
Not only NFT (ERC721) tokens are helpful in the gaming industry but all other blockchain features can be used in the gaming industry to enhance the gaming industry, you can take an example of how Esports is using blockchain technology.
Some of the big names of the gaming industry also joined the blockchain revolution and started building dapps.
Highlights of Esports blockchain program
The eSports industry is projected to bring in revenue of over $1.5 billion by 2020, popular game ‘Fortnite’ brings in $1.5 million per day on iOS alone, and ‘Red Dead Redemption 2’ made $725 million in its opening weekend.
This model offers rewards based on participation or viewership. Participants can earn tokens by signing up for the relevant service, then either running a browser plug-in or watching an Esport through a particular website to earn loyalty tokens.
The difference between a traditional points scheme and a blockchain points scheme is that the tokens are part of a cryptocurrency and carry a potential for the value that can be used with anyone who accepts such tokens.
They can even be sold and converted to other cryptocurrencies (on exchange), or all the way back into a traditional currency.
So instead of earning points that can only be used inside one given company’s platform, these schemes aim to extend value far beyond the game space to create something more attractive for participants.
Should any given loyalty or incentive cryptocurrency build a presence across multiple games and streaming platforms the value to users grows much larger, which in turn may increase the impact on growing viewing times and therefore, ultimately, revenue?
The role of the pandemic in the NFTs’ popularity within the gaming industry
COVID-19 has altered how people interact, travel, communicate, work and conduct business, says Russo, but “it’s also reshaping the entire gaming industry.”
He quotes figures that reveal in April 2020 alone, U.S. consumers spent a record-breaking $10.5 billion on in-home gaming:
“This renewed passion for gaming has also caused a spike in gaming stocks. As people continue to social distance, this trend will continue. And – as players discover blockchain games, powered by NFTs and digital collectibles, which offer an entirely new, fully-immersive gaming experience – they will continue to embrace blockchain games.”
The collision of blockchain technology and gaming holds great promise for the growth of both industries.
Innovations in the budding field of blockchain gaming have pushed the limits of non-fungible assets and are poised to keep supplying novel developments in other areas like scalability.
So far we have discussed the gaming industry, blockchain industry and how these two industries can come together to boost the economy,
We all know the power of gaming industry and also fan base of this industry, blockchain technology have also shared the same stats in terms of popularity and potential capability, a developer who love crypto and gaming have already joined this league.
However, the emergence of the blockchain gaming trend is not without its hurdles.
Scalability issues are legitimately prohibiting the development of many games at this point and will need to be overcome before the industry can reach its potential.
The intersection of blockchain technology, cryptocurrencies, and gaming is promising.
Coupled with the meteoric rise of eSports and an opportunity for developers to properly monetize and participate in the gaming community, the intersection will assuredly facilitate a new gaming landscape.
We at Crypticocean will here to help you to know more about this.
What is the future of Blockchain in the gaming industry?
The Blockchain in the gaming industry will provide proof for asset scarcity. Hence, developing the interest of gaming for the users. The blockchain ledgers will allow the game developers to build rare digital assets and items in the 3D virtual reality games.
How could blockchain make online games better?
There are three main ways how blockchain technology can improve the value of virtual items in the 3D virtual reality video games.
The first one is the use of virtual items in a unique way in virtual reality videos which can increase the functional value of those digital assets. Increasing the social value of the digital assets in the virtual reality videos by setting up networks that could facilitate sharing, trading, buying, and gifting.
Which is the most popular blockchain game?
CryptoKitties is a blockchain game on Ethereum developed by Axiom Zen that allows players to purchase, collect, breed, and sell virtual cats. Age of Rust the game started out on the Bitcoin-based Counterparty network with its own Rustbits cryptocurrency but has since switched and is now part of the Enjin Coin Multiverse of games, which is based on the Ethereum blockchain.
What are the disadvantages of using Blockchain in the gaming industry?
Here are Various Disadvantages of Blockchain in the gaming industry :
When it comes to blockchain for gaming, perhaps one of the most significant problems so far has been speed. These days, everyone wants a quality, state of the art gaming experience that doesn’t lag or provide any issues with speed and pacing.
2. User experience (UX)
Onboarding mainstream gamers into a blockchain game and then actually playing the games is certainly not a smooth process.
3. Rising costs
Next, there is the issue of maintaining blockchain gaming systems. Transactions on blockchains (especially Bitcoin and Ethereum) are inherently expensive, and they could cost dollars per transaction at times.
4. Scaling in time
When a blockchain game becomes popular (such as CryptoKitties has), maintaining its operation could require hundreds of thousands (and in some cases, even millions) of transactions.
Must Read out our other blogs also.