The Gaming Industry is Shifting Into Web 3.0; What Does the Future Hold?
Disclaimer: The Industry Talk section features insights by crypto industry players and is not a part of the editorial content of Cryptonews.com.
Gaming is one of the most popular and rapidly growing industries in the world today. With advancements in technology, games have become more accessible and immersive than ever before, attracting people from all walks of life. According to data analysis by Mordor Intelligence, the gaming industry had a valuation of USD 198.4 billion in 2021; this figure is expected to hit USD 339 billion by 2027 at a CAGR of 8.94% over the next five years.
Despite its popularity, this booming industry still faces many challenges such as guaranteeing fair play models and creating effective payment systems. Luckily, upcoming technologies like blockchain are gradually solving these pain points. At its core, blockchain tech introduces decentralized and secure solutions that can be used to power a wide range of functions within the gaming industry.
Most notably, Non-Fungible tokens (NFTs); these are unique digital assets that can be traded and sold on secondary markets without third party interference. Unlike the centralized traditional gaming ecosystems, NFTs allow gamers to truly own their virtual items and to participate in decentralized tournaments with minimal risk of fraud or tampering. Will the next era of games be hosted on blockchain? Let’s delve deeper into the developments to get a glimpse of the future.
A Step Into the Metaverse
The Internet has undergone several iterations since it was first launched in the early 80s; today, we are in the Web 3.0 (decentralized web) era. This latest version of the internet has become a fundamental pillar in the development of the metaverse. First coined by Neal Stephenson in his 1992 science fiction novel ‘Snow Crash’, the metaverse represents a virtual ecosystem where humans can live and interact as programmable avatars.
What does this mean for the gaming industry? For a long time, centralized publishers such as Ubisoft and Activision Blizzard have been the main beneficiaries of proceeds generated from the gaming industry. However, this dominance is gradually being challenged by upcoming Web 3.0 games, whose fundamental infrastructure is NFT tech and the metaverse. A recent report by DApp Radar revealed that the number of active blockchain-oriented games doubled in 2021.
That brings us to the role of NFTs and the metaverse in modern-day gaming. By design, these two facets of the crypto ecosystem are built on decentralized blockchain networks such as Ethereum, Solana, Avalanche and Polygon. This means that gamers do not have to go through a centralized intermediary to play a particular game. Instead, one can directly connect to the blockchain ecosystem and engage in a game of their choice.
Gaming in the Web 3.0 Era
Bitcoin is among the pioneer Web 3.0 innovations to ever debut; this leading digital asset has not only paved the way for decentralized payment ecosystems but gaming platforms as well. With NFTs and the metaverse in the picture, gaming enthusiasts can free themselves from centralized gaming environments that only feature immersive experiences with minimal opportunities to make an extra income from in-game items.
Well, the play-to-earn (p2e) model solves this shortcoming; gamers in the Web 3.0 economy are incentivized for participation. For instance, the Ignite Tournaments p2e game allows players to organize decentralized esports competition by staking the $TENKA token as entry fees. In addition, players can generate passive revenues by farming more $TENKA while they compete in a particular tournament.
There are also some upcoming p2e games that mimic the likes of Fortnite and Call of Duty (feature more actionable gaming environments). One such innovation is Blast Royale; in this game, 30 players are pitted against each other in a ‘last one standing’ survival match. Those who win are rewarded with the $BLST ERC-20 token, enabling them to acquire more in-game items that can improve one’s performance.
For players who might find it a bit expensive to start p2e gaming, it is possible to rent in-game items through platforms such as Balthazar. This Decentralized Autonomous Organization (DAO) features a scholarship program where interested gamers can access the required resources to engage in p2e games like Axie Infinity.
In the future, it is likely that most games will pivot into the metaverse. This explains why tech giants such as Microsoft and Facebook (now Meta) have been making strategic moves in recent months. According to Microsoft’s CEO Satya Nadella, we are still in the infancy stages of the metaverse,
“When we talk about the metaverse, we’re describing both a new platform and a new application type, similar to how we talked about the web and websites in the early ’90s,”
While it may take a few years before retail notices the paradigm shift, VCs are already investing heavily in NFTs and the metaverse. In Q1 alone, a total of USD 2.5 billion was injected into various projects. Going by these trends, it is quite evident that tomorrow’s gaming industry will be built on Web 3.0 infrastructures.