Forget Speculation and Play-to-Earn; This Is What NFTs Really Mean For Web3 Gaming

Undeniably, the ongoing shift from Web2 to Web3 and the rise of the ‘metaverse’ will be a significant turning point in our online lives. However, there are a lot of empty, over-hyped projects and promotions that leverage “Web3” and “metaverse” as little more than buzzwords, offering little beyond the promise of making money.

This has become a pervasive issue as blockchain functionality continues to extend into the world of gaming. Multiple projects have been launched that seem to simply graft blockchain elements into copy-pasted game formulas and promote them as though they were meaningful innovations. However, the truth is that not every game needs to be focused on earning mechanics, and in many cases, it can detract from the core gameplay. To be most effective, non-fungible tokens (NFTs) and other assets must have meaningful utility within the context of the gameplay — with profit incentives remaining in the background, and not promoted as the number one selling point.

It’s Not About The Money

This problem is compounded by the fact that many of these products are sold with the implication that users will make money simply because the game ecosystem is based on cryptocurrency. In practice, this is a gamble at best. The idea is popularized by one-off stories of people getting rich quickly; however, in reality, for every person who got rich there are twenty who lost everything, because economies where everybody always profits simply do not exist, and today’s Web3 gaming paradigm is not sustainable.

Tokenized assets and trading can still be a part of a great gaming experience, though. Look at the Steam marketplace, which allows gamers to swap items from titles like Team Fortress 2 and Counterstrike. This market element is an augmentation to the games involved but doesn’t interfere with the actual mechanics. The issue with Steam is that all assets are locked into the game they’re designed for, as well as onto the platform itself, and this is where blockchain can take the experience further.

It’s About Making Better Games

Instead of obsessing over this technology making anyone rich, developers and gamers need to begin thinking about how blockchain can make a gaming experience more fulfilling and ultimately put more power into players' hands. Take in-game items, for example. By turning these into NFTs, gamers now have the ability to truly own them, move them off-platform, or legally trade them at their discretion. 

Again, the point isn’t that any specific items will appreciate — although they might — but that real ownership of earned in-game items has value in itself. Compare that to most current models where sales are one-time events, and the goods are locked to a player’s account, meaning that when players move on, all that value is simply gone. 

Accessories, avatars, land, currency, and almost anything can convey the same benefits of autonomy and flexibility. Pricing and quantity of these items need to be carefully balanced, but the idea is that when done right, these elements should be in place to bring depth to a game experience that would have still been enjoyable without blockchain. 

It is looking pretty likely that blockchain features will continue to be integrated into future gaming titles; the genie is out of the bottle, and there’s no going back. More games are emerging which make use of Web3 technology, and major developers from the mainstream gaming industry have begun to support it. Mass adoption is only a matter of time.

It’s time to start utilizing the best elements of what this technology can do for gamers and game worlds and help gamers and critics of Web3 alike understand that blockchain integration needn’t be about money. Developers will get there, but they need to start engaging with decentralized assets in a thoughtful and innovative way, not as a cheap means to draw attention to their projects.

About the Author:
David Kim - Head of Publishing at WAX Studios

A veteran in the video game and entertainment industry, David Kim possesses over two decades of experience working for and with big brands like Warner Bros, 20th Century Fox and Sony Pictures Entertainment, THQ, and Vivendi Universal Games. David is now spending the majority of his time at WAX tackling the main issues of mass adoption in the blockchain gaming space.