The gaming industry is a multi-billionaire dollar market traditionally dominated by giant corporations like Atari, Sony, Microsoft and Nintendo, am
The gaming industry is a multi-billionaire dollar market traditionally dominated by giant corporations like Atari, Sony, Microsoft and Nintendo, among others.
Throughout their history, these major firms have aimed to provide entertaining gaming experiences to attract new players and expand their market share.
However, nonfungible tokens (NFTs) are attempting to give gamers a financial incentive for playing games in the form of NFTs, in addition to providing an engaging gaming ecosystem.
These games, known as play-to-earn (P2E) games are played in a Metaverse that is essentially a fictional universe. The P2E gaming model dictates that the users of the platform are financially rewarded for their time and effort within the game. Due to this, the model has a chance to gain a portion of the $175.8 billion global gaming market that is touted to grow to more than $200 billion in 2024, as per a report by Newzoo.
Minh Doan, the co-founder of Warena, a personalized NFT game, told Cointelegraph more on the relevance of this model. He said:
“Today, we call the play-to-earn model on the blockchain GameFi — the combination of decentralized finance and game mechanics — has become a real sensation in the market due to the fact that during gameplay, users receive tokens that can grow by tens and even hundreds of times in value.”
The protocols in the NFT gaming sub-sector have been gaining a lot of traction in terms of users and volumes. Their associated native tokens have been performed extremely well too. The native token of the Ethereum-based NFT game Axie Infinity (AXS) has been leading the charge for the sub-sector. The token has posted 83.35% gains in the last 90 days, 706% gains in the last 180 days and over 73,000% yearly gains.
AXS currently changes hands in the $120 range and has risen to become one of the top 25 cryptocurrencies in terms of market capitalization as per data from CoinMarketCap, making it the only NFT gaming-related token to make the cut. The platform itself has witnessed impressive growth in terms of users and volumes since its launch. According to data from Dappradar, there has been trading activity worth $2.6 billion on the platform with 836,149 traders participating. The platform has also announced a staking program for its native token.
Related: The Metaverse, play-to-earn, and the new economic model of gaming.
Cointelegraph spoke to Alex Salnikov, the co-founder and head of product of Rarible, an NFT marketplace, who explained more on the drivers of this growth noticed in the NFT gaming platforms, both in terms of volume and users. He said:
“This growth aligns with the broader acceleration of the NFT market and seems to highlight the versatility of use cases for NFTs. Also, gamification has generally been trending in crypto and it matches particularly well with the concept of NFTs that are so closely tied to interactive and fun community engagement experiences.”
He also added that the value proposition of blockchain technology is understandable and native for the gaming industry, including P2E experiences and in-game assets with clear provenance.
NFT gaming platforms grow
Even though the most utilized blockchain network for the deployment of decentralized applications (DApps) is Ethereum, in the NFT gaming ecosystem, there are several other blockchain networks like Binance Smart Chain (BSC), Polygon, Hive, Harmony, Solana and Flow that are also gaining large user bases along with growing volumes.
Salnikov further mentioned, “Polygon is generally considered to be one of the leading blockchains for gaming due to its EVM-compatibility, high throughput and low gas fees. It’s also the leading sidechain of Ethereum, meaning that it’s connected to the main NFT ecosystem on layer one.”
Cointelegraph spoke with Jesse Reich, the co-founder and CEO of Splinterlands, one of the leading NFT gaming platforms in terms of users, about the protocol’s choice of the Hive network to build their game. He said:
“People have thought our choice of Hive has been bizarre since the early days, but it has a freemium structure. Players can sign up with a username and password and get started. It’s hard to replicate that on POW blockchains with gas fees.”
On Oct. 12, Binance announced a $1 billion accelerator fund for the overall development of the BSC ecosystem. Popular games on BSC like MOBOX: NFT Farmer, Faraland, ZOO Crypto World, and CryptoBlades are bound to grow as a result of this fund leading to massive adoption of the network.
Despite the growth seen across various platforms and networks in the NFT gaming sub-sector, the long-term proposition of these games could be in question, since gamers from the traditional gaming community are used to playing games that are extremely well designed. These titles also boast impressive gaming ecosystems, as a majority of them are backed by large corporations that have ample resources and development infrastructure.
At this stage, this cannot be said of…
cointelegraph.com