How has the gaming industry caught fire because of Crypto?

Cryptocurrency is a viable payment method at several online gaming venues. However, crypto is impacting the gaming industry beyond processing transactions. In fact, cryptocurrency is one of the primary contributors to developing and expanding the current gaming market. Blockchain has the potential to completely restructure the industry, upend the monopolistic console market, and make games more immersive than ever before. 

In 2018, Fortnite earned $2.4 billion, making it the highest-earning game in history. In 2018, free-to-play games accounted for 80% of all global gaming revenue; on consoles, free-to-play titles grossed 458% more than in 2017. Let’s dive into how the gaming industry can continue its upward trajectory thanks to crypto. 

The Modern Gaming Industry: Status Check

The global gaming industry generated $178.2 billion in revenue in 2021 and is expected to cross $196 billion by the end of 2022. Fuelling this rise are microtransactions – inevitable in today’s modern video games. From buying costumes to characters and weapons – every in-game purchase depends on the success of microtransactions. There are distinct characteristics of gaming platforms. Further, the stakeholders of these games have distinct responsibilities. 

Some of the clear market needs of the modern gaming industry are as follows:

• Developers require a safe and secure environment to develop, launch and monetize their games.

• Players need a secure platform to transact with in-game currency.

• Players need money to perform transactions in the online gaming world. While some games allow a player to accumulate digital gold, most players find it inconvenient as it is a time taking procedure. The majority of players spend their real-world money on in-game items.

• Players store their virtual assets on the gaming company’s centralized server when they are not playing games. This makes them an easy target for hackers, and the players face fraudulent transactions in the gaming world.

• There is a fear of shutting down gaming platforms without the permission or knowledge of their players. Further, this disruptive nature of the gaming industry is also due to the fact that players don’t really own their virtual assets and, rather, the gaming company owns them.

How is Crypto Changing the Gaming Industry?

Blockchain-enabled games operate with the idea of creating value for players. Crypto has introduced a paradigm shift in the gaming world, enabling players to truly utilize assets they obtained via in-game purchases, regular gameplay, or promotional events. 

For instance, if you buy armor in FreeFire, the only benefit is improved gameplay (in this case, improved protection) within the context of that particular game. However, in a crypto gaming ecosystem, the same armor can be tokenized as NFTs. This will transform in-game purchases into transferable assets that can confer benefits across interconnected games or be exchanged for money or other digital assets.

Crypto is being deployed in online games to solve challenges with transactions and fraud that players encounter while playing most online games. Further, the use of cryptocurrencies in the gaming world helps allows the players to enjoy the following benefits:

• Cryptocurrencies offer appealing features in terms of confidentiality that far outweigh traditional channels. A player’s identity is not disclosed with their activities in blockchain transactions. Instead, an e-wallet and a unique identity code are used by the system for in-game purchases using cryptocurrency. Users remain anonymous. In this way, players can enjoy financial freedom and privacy.

• Cryptocurrency transactions are quick and hassle-free. A blockchain-based game will use smart contracts to govern transactions inside the game.

• The use of digital currency also facilitates easier transfer of assets. Many crypto gaming platforms accept digital currency to participate in esports. They also use the same cryptocurrency to provide incentives and bonuses to the players.

• The use of cryptocurrencies in the gaming world offers a decentralized or hybridized gaming experience. It means that the developers of blockchain-based games cannot change the game in any way without the community’s approval. Some games run from a central server in a hybridized model, but its assets are traded through a decentralized marketplace. In either case, blockchain makes in-game assets as ownable as possible in mostly a decentralized manner, thereby enhancing their legitimacy and long-term value.

• To secure crypto token transactions, blockchain platforms employ highly powerful data encryption technologies such as the private key-public key pair. These data encryption techniques are impossible to hack using today’s computing technology. Hackers will be unable to destroy a decentralized blockchain network. Therefore, crypto gaming is safer and more reliable than traditional gaming.

• Another benefit of using cryptocurrencies in gaming is that players can have a right to vote on the gaming platform’s future and collaborate with the developers to improve the game.

• Further, players can also own their virtual assets in the form of NFTs and earn from them.

According to new research, more than 70% of game developers would consider incorporating blockchain technology, cryptos, and non-fungible token (NFT) into future games. And nearly half of the developers surveyed claim they’re already doing it. 

Crypto and the gaming industry are a powerful combination that offers a safe, secure, fast, and transparent gaming experience for all. Online gaming companies offer quick, interactive, and useful gaming services to everyone worldwide. And with the help of cryptocurrencies, the gaming industry will get the much-needed boost to expand even in the metaverse.