Market Trends
Mobile gaming has increased in the past couple of years. The mobile gaming market was valued at $79 billion in 2020 with a global average of 1.5 million mobile game players in 2020. This increasing demand for mobile games directly results from various technological advancements such as AR, VR, cloud gaming, and 5G. This trend is not surprising, considering the mobile game industry primarily relies on new technology. Blockchain gaming is one of the new technologies that is emerging in the mobile gaming market. Most blockchain games are mobile games played on smartphones or tablets.
Blockchain Gaming Market The blockchain gaming market is currently relatively small, yet the idea of earning a token in games is as old as video games itself. The goal of Mario Bros on Nintendo in the 90s was to go through the game and collect as many gold coins as possible. Similar concepts were developed for Sonic on Sega, where coins were replaced with rings. While some larger gaming companies – such as Ubisoft and Square Enix – have begun dipping their toes into blockchain-based games, most development has been led by crypto native companies. Blockchain games have multiple benefits for the gaming community. For players, blockchain gaming has the following key benefits:
Digital property rights: in traditional games, players purchase digital items (e.g. skins in Fortnite) and then can really only use these items in-game. Through the creation of NFTs facilitated by blockchain technology, these purchases transform an expense into an asset, creating actual secondary value from these purchases.
Originality: virtual goods now have rich histories and individuality. Imagine being able to own the exact, signed gun skin your favorite esports players used to win the world championship.
Security: The decentralized nature of most blockchains (e.g., Ethereum) means players don’t need to trust any single developer. Their virtual goods can be demonstrably scarce, highly secure goods operated on a cryptographic, decentralized backbone.
Increased financialization: players can use their virtual items like traditional assets as collateral for usage in DeFi. For example, a player could secure financing for their next battle pass by lending out their high-end weapon.
Financial alignment: gamers can now participate in the economics of the games they love and play. Developers can share a portion of their revenue with the game’s supporters by issuing tokens.
Benefits are not only applicable to the gamers but also to creators and developers of blockchain games. Blockchain games provide a healthier game economy with the opportunity to monetize more players versus the free-to-play gaming model. Traditionally less than two percent of players are converted to paying customers of in-game items. The opportunity to monetize a larger proportion of players arises from the willingness of players to spend money driven by the benefits of digital property rights or provenance. Moreover, sharing a portion of the economics with gamers means less acquisition cost to get gamers onto your platform, as well as better economic alignment between gamers and developers.
We believe these are early days for blockchain gaming and more and more blockchain games will be developed capitalizing on the above-mentioned benefits and developing more complex games tapping into the world of blockchain-enabled virtual economies. Amongst the previously mentioned 1247 blockchain games, arcade-type games are not represented. Games of skill, such as Fighting Scene Games are - due to their complexity in developing - uncharted territory in the blockchain games sphere. This represents ample opportunity to develop a game where two players match up against each other and determine a winner based on skill, with the benefits of earning tokens for each match-up. Players are able to monetize their skills and benefit from the blockchain-enabled virtual economy.
Last updated