Games have been enjoyed for financial gain since the 2000s. But with the emergence of cryptocurrencies, NFTs, and blockchain technology, the idea of gaming has significantly changed. This blog explores how play-to-earn games, virtual goods, in-game economies, and the GameFi idea have affected the iGaming sector recently, now, and in the future.
The market for video game goods prior to the development of blockchain tech will also be covered, along with an analysis of how this technology has transformed the sector. So let’s get going!
Introducing GameFi Concept
The terms “gaming” and “finance” are combined to form the term “GameFi,” which describes P2E titles that have financial elements but are distinct from non-gambling activities. These games demand skill and effort because there is less chance involved.
The crypto casino, on the other hand, provides a selection of games with both skill-based and chance-based options. By completing various tasks and competing for positions on the daily chips-leaderboard, players can earn $ICE tokens in one such free-to-play live metaverse poker game. 273,000 monthly users and more than 25,000 daily active users of the game were recorded by the first quarter of 2023.
Because they provide the economic building blocks that enable game developers and players to have substantial property rights within game worlds, all blockchain titles are also known as “play-to-earn” games. As shown here.
For Game Developers
- New revenue streams
- Access to capital through ICOs
- Increased control over in-game mechanics
- Access to stronger communities
- More engaged players by DeFi elements
As seen from above, GameFi concept (GFC) in particular, game devs are able to create decentralized economies that are transparent, secure, and more open to market forces.
Furthermore, blockchain gives them the option to produce their own cryptocurrency, which can give game developers a new source of income and support the growth of a strong player base.
Additionally, GFC supports a new method of funding projects through initial coin offerings (ICOs) or other token sales. Bypassing conventional financing avenues is made possible as a result.
- New ways to earn money
- Ownership of digital assets
- Staking or trading NFTs
- Flexibility between different platforms
- Increased transparency
From the aforementioned list, it is clear that gamers now have more control over their virtual belongings and have access to decentralized markets and currency exchanges.
GFC Before Blockchain & Its Limitations
Virtual currencies and in-game economies were introduced in games like World of Warcraft and Second Life prior to the development of blockchain tech. Users had the option of buying, selling, and trading items with real monetary value, and in some cases, players could turn a tidy profit from their gaming pursuits.
These illustrations did, however, have some restrictions. They were frequently centralized and controlled by the game publishers as a result of the lack of user participation in an accessible and open market. More so, not all transactions were reliable, and there were risks involved when buying and selling assets outside of the game world.
These issues have been reframed by blockchain-based gaming by offering a decentralized and secure platform for payments and gathering in-game assets (i.e. collectibles). As such, it is crucial to keep up with the most recent developments in emerging innovations and AI companies because they have the potential to completely change our world.
Other Blockchain-Inspired Examples in iGaming
Apart from the GameFi concept and in-game economy, there exist several other advantages of blockchain that are contributing to the evolution of the gaming sector and facilitating the creation of P2E titles. These benefits comprise:
Transaction records are secure and transparent thanks to the decentralized and immutable nature of blockchain tech. This clarifies instances of fraudulent behavior like double spending. Devs can build self-sustaining economic systems inside their products thanks to this level of transparency.
Digital transactions also benefit from an additional layer of transparency thanks to the decentralized nature of chain tech. This openness is especially helpful in games where players exchange private information or virtual goods like NFTs.
The increased safety provided by blockchain in iGaming is another important advantage. Blockchain adds an extra layer of security by utilizing encryption technologies like secure messaging and two-factor authentication to prevent tampering with or hacking of sensitive data like player information, game data, and user transactions.
Unquestionably, blockchain tech provides a confirmation mechanism to ensure that all interactions between various parties are legitimate. In addition to using it to confirm transactions, developers can use it to stop repeated payments for the same goods or services. This is feasible because every transaction is recorded on the open-source chain.
Last but not least, contracts built on blockchain (i.e. smart contracts) can significantly reduce transaction costs and time by replacing centralized servers in gaming. More so, it provides users with the ability to trade their collectibles and resources for profits or other assets through its immutable record-keeping system as mentioned above. As a result, gamers can confidently engage in transactions, with the assurance that their items will remain secure and unduplicated.