Gaming is not a new phenomenon. Yet, it has seen tremendous growth in the past few years and shocked investors & gamers alike. This monumental growth is fueled by the rise of mobile gaming which has outpaced pc gaming & console gaming and was valued at USD 97.81 billion in 2021, according to a report by SkyQuest. The video game industry as a whole is expected to see double-digit growth in the coming years, with the market size doubling in 8 years.
In the past two years, Blockchain gaming, a new sub-industry has seen skyrocketing growth that has outperformed the industry standards and has gained eyeballs both from gamers & investors alike. The blockchain industry in 2022 was worth a whopping USD 4.6 billion and it is poised to grow at a Compound Annual Growth Rate of 70%, reaching USD 65.7 billion by 2027.
These meteoric growth projections can be attributed to GameFi & NFTs, which have captured the minds & hearts of gamers. Non-Fungible Tokens (NFTs) have come a long way since their inception in 2014. The first NFT Quantum was minted by Kevin McCoy on Namecoin in 2014. And it was not long before the first NFT-based game was launched. One of the earliest blockchain & NFT-based games was Spells of Genesis, which was launched in 2015.
But the game that truly revolutionized blockchain & NFT gaming was released in 2018, called the Axie Infinity. It was the first P2E (Play to earn) game that offered the user a monetary incentive to play & compete in games. Players could then earn cryptocurrencies by completing in-game tasks such as battling other players, leveling up, etc. Some other popular blockchain-based games that were released soon after included Decentraland and Sandbox.
Blockchain gaming is part of a bigger web3 ecosystem that propagates the idea of an open internet where users own & shape the platforms they use. In that sense, blockchain-based games are community owned through the use of tokens. Players get a chance to make changes & updates to the game, through voting proposals. They help create & shape the platform they use.
NFTs (Non-Fungible Tokens) boost this ownership sense, by allowing players to truly own their in-game assets. Up until now, in-game assets or achievements were all inside the games, meaning you couldn’t take them out of the game to showcase or trade. But NFTs have completely changed this, by allowing players to mint their in-game assets & achievements as NFTs. These NFTs can be taken out of the game, and further traded in third-party marketplaces. Integration of NFTs inside games also allows them to safe from any hacks or server disruptions. And as these assets exist on the blockchain, no one can tamper with them. Only the player has full control & authority over it.
In this regard, Craig Russo, Head of Innovation at Polyient Games stated, “some of these in-game assets might cost thousands of dollars individually due to scarcity.” “It tethers your sword or gun to the blockchain, allowing you to own it, remove it from the game, and resell it for a profit on the open market.”
The inception of blockchain-based games has allowed players to become investors in a true sense. Many big-name brands have also jumped on the bandwagon by releasing their own blockchain-based games such as Sony with the launch of The Six Dragons. The phenomenon has also brought back brands of yesteryears such as Atari which has launched its own chain called AtariChain. The future for blockchain-based games appears bright and exciting.