Crypto market and the Gaming industry: A stable marriage or a brief affair?
A flirtatious attempt between Gaming and Decentralized Finances
The gaming industry is not new to the business of money. Developers have tried for years to earn as many benefits from players as possible. New franchises, new assets, new characters, etc. “Hey, do you want to have the best character and the best skills?” “Well, it’s pay time”. So, it’s quite ironic how many game purists are trying to step away from the new GameFi scene. Even classics like Second Life in 2006 already used transactions outside the real world, with a lucky real estate agent selling his in-game plots for the crazy amount of 1 million pounds.
In a world where technology has developed so much that we can almost live in the online world, soon to be achieved by the metaverse, the gaming industry also had to change. With 3 billion online gamers across the world, it’s not “Should we add something new?”, it’s more “We must reinvent the wheel”. The gaming industry cannot be stuck for eternity in the same formulas and needs to re-shape its paradigms based on the new virtual world.
The wheel of games is being re-invented in a context where the economics of the world are also being re-shaped through the alliance of crypto space and the Web 3.0. Even though games in the past had a certain level of transactions, there was still a lot of room for improvement, especially in favor of those passionate players who were years waiting to own their assets in-game. However, the crypto market and its use of decentralized finances have helped the gaming industry to introduce low-fee transactions through blockchain technology.
The combination of the decentralized finances and gaming industry creates a powerful and still infant industry, GameFi, that is on its way to following the steps of both of its big brothers. However, the premise of this new model is a brand new shift from its predecessors, as it offers players the opportunity to own their assets and maximize earnings inside their favorite games, as developers also benefit from the attention.
The advantages of the online sphere create the rise of a community of gamers that come back for another dose of the “play to earn” experience and eventually increase the value of the GameFi games. The more value, the more popularity and higher the chances of earning and blossoming in the industry. Gamers’ communities also work as a strong incentive for game innovation and a higher quality of the Play2Earn games.
When MixMarvel’s founders mentioned for the first time the term “GameFi”, they couldn’t imagine that the industry would bloom in 2020 and become a new model of gaming that gathers millions of users daily. GameFi generated $2.32 billion in revenue in the third quarter of 2022, with a market cap of over $11.6 billion. Even though there are still huge differences from the regular gaming industry, gamers are immersing in the GameFi industry and the Web 3.0 at an astonishing speed. In addition, the revolution of the Metaverse is adding a lot of attention to the happy marriage of Gaming and Defi, and some investors are already considering the blockchain game space as its micro world.
An engagement in the near future
During the space race back in the Cold War, it seemed like humans were a force of nature that could master flying cars by the 2000s. However, despite all the development of technology we do not have houses that clean themselves or an amusement park on the moon.
But one of the biggest fantasies of all the science fiction books might be coming to life very soon through the Metaverse. And it will be a matter of time to have our reality completely integrated into the online world.
However, even though Black Mirror insists on the dangers of those gigantic technological steps, the metaverse is a solution for many fields including education, healthcare, and of course, the entertainment industry.
The metaverse will be able to encapsulate augmented reality, digital economy, and of course, the Web 3.0. It will not only be a new way of interacting with technology but a revolution in the way we live.
This sounds very promising for the gaming industry, especially because the Metaverse will most likely integrate decentralized finances due to the handling of data and personal information from users. Therefore, the crypto market will eventually rise in the future and more and more gaming projects will take part in GameFi.
We can safely say that the marriage between gaming and decentralized finances will last in time, and probably thrive as new technologies come to life, allowing gamers to experience new ways of entertainment that ultimately will be crucial to earning and having fun in the process.
The revolution is here for better or worse and those who still binge-watch Black Mirror and claim the dangers of the evil technology forces will have to agree with it. Just like it happened to those old cinephiles snobs with Netflix and streaming services, the gaming industry will belong to the Play2Earn model sooner or later.
After the honeymoon
The bumpy ride of markets during May of 2022, made investors raise their eyebrows when it comes to the GameFi industry. But those who live on figures are not able to understand the true possibilities and nature of an industry that, even though it is technically tied to the market, does not need it to shine.
The blockchain market is still in its early years. NFT games alone generated $2.32 billion in revenue in the third quarter of 2021, according to the Blockchain Game Alliance. The overall gaming industry is set to reach $203 billion this year.
Blockchain-based games are becoming bigger and better. Many indie companies also found in them a niche to experiment and push new narratives without the big support of a network. And even though GameFi gaming is still trying to earn its place in the gaming community, the first greens are starting to soil.
The new initiatives of the industry are revolving around the concept of Play2Earn but expanding more on “Play” than to “Earn”, this means that the gap between the traditional gaming scene and GameFi is starting to close. The challenge is to make Play2Earn games as enjoyable as traditional ones, where graphics, storylines, and characters feel organic and immersive.
The future is to bring together Web 3.0 and the conservative gaming scene, so entertainment is also a formula for users and developers to earn, generating a beneficial and smart way of playing where all the parties are winning.
Regardless of the bear market, the GameFi industry shows symptoms of development and growth and a constant stream of innovation where the condition of the market might be considered when investing on a certain project, but not taken as a clear indicator for success or failure.
