The gaming industry has been on the rise for the past several decades, and it seems that there is no end to its continuous growth as the number of gamers increases every year. Online gaming is a particularly thriving niche which is projected to reach astounding heights in terms of revenue in the future thanks to technological advancements such as virtual reality and 5G.
Cryptocurrencies may also play a significant role in the transformation of the online gaming landscape and become the primary means of exchange for billions of players worldwide. Moreover, as the evidence demonstrates, there are already instances when gaming platforms and services switch to fiat alternatives and now their examples may encourage others to follow suit.
Advantages of Cryptocurrencies for Online Gaming
Security of Transactions
The value of blockchain technology lies in the high level of security it brings to the users’ transactions. Every exchange that takes place on the network is recorded and cannot be reversed. The latter aspect is particularly beneficial for gamers since people that trade in-game items often encounter fraudsters who try to take advantage of them. One of the common schemes involves a scammer requesting a refund after they receive the expensive item sent to them by the victim.
Platforms such as PayPal often approve refunds for transactions which do not imply shipping of a physical object since there is no viable way for the company to ensure that the person asking for the refund does not lie. As a result, the seller may both lose their item and money. Blockchain solves this problem by registering every single transaction and making them impossible to overturn.
This eradicates virtually any possibility of fraud. Additionally, when transferring cryptocurrencies, people participating in a transaction do not have to present their id and share personal information with any third party. Thus, blockchain helps players maintain their anonymity and security while online.
Large gaming platforms such as Steam restrict users’ ownership which means that when buying a game or an in-game item, they are considered simply their temporary holders. Therefore, these companies retain the right to shut down any user’s account at any moment and deprive them of all of their valuable possessions accumulated over the years.
Blockchain-based gaming can give players back their ownership of the items for which they paid with their own money. By treating these items as crypto assets, game providers can recognize players as owners who have full capacity to do whatever they please with their digital belongings, whether to sell, store, or destroy them.
There are a plethora of cryptocurrencies which offer different transaction times. For instance, Bitcoin is known for its relatively long periods of transaction confirmation which on average take ten minutes. While XRP requires no more than 10 seconds to process a transfer of funds. The faster blockchains can be a great solution for online games which seek to ensure quick exchanges on their platforms and improve their customer experience.
Fiat transactions are prone to various problems. For instance, some users may not be able deposit their money during bank holidays. Buying a game or an in-game object becomes impossible for them. Banks also can freeze accounts of their clients due to suspicious activity. It can prevent gamers from purchasing a rare-event item. Blockchain removes the presence of the auditor which controls the link between the gamer and the game provider. This allowsthem to carry out exchanges at any time and from anywhere in the world.
Lack of Regulations and Lower Fees
The crypto industry has been rapidly advancing. However, governments around the world have not yet made any major steps to take it under control. That might be because blockchain grants complete decentralization which authorities cannot contain.
Fes of cryptocurrency transactions are extremely low compared to fiat ones. It once again benefits both game developers and gamers. Namely, companies that utilize crypto are able to provide items for lower prices. That means that gamers have the capacity to buy more of them.
Online Gaming Projects that Use Crypto
Spells of Genesis
Spells of Genesis is a mobile game that is based on blockchain technology. It ultimately allows its players to collect cards and “blockchainize” them. In other words, users can transform their in-game card into a digital asset. Players receive full ownership of the asset and can trade it with others outside the game’s ecosystem. The primary blockchain used at Spells of Genesis is Ethereum. It means that players can store assets in their wallets and receive actual crypto for their items. Moreover, the Book of Orbs wallet even lets users track the current value of their card.
Axie Infinity is another blockchain-based online game where players can raise, buy, and sell characters called Axies. These characters constitute crypto assets, tokens existing on the Ethereum blockchain. In addition to Ethereum, active players also receive the game’s native token, AXS. They can stake it to gain even more rewards.
Provably Fair Casinos
Provably fair casinos utilize special algorithms. Users can determine their fairness by looking at their open-source code. Traditional casinos have to prove their legitimacy by acquiring and renewing licenses from different jurisdictions. They function as parties that guarantee gambling operators’ fairness. Such a system is imperfect and vulnerable to potential fraud on the part of the casino. Blockchain casinos, on the other hand, offer games whose outcomes are predetermined by algorithms. There are many provably fair casinos in existence, and BitStarz is one of the most reliable ones. The platform features slots, table games, and live casinos and accepts numerous cryptocurrencies.
Cryptocurrencies also can replace fiat in the gaming industry as the main payment option. G2A.com is a large marketplace that specializes in gaming products and one of few retailers that accept Bitcoin.
Cryptocurrencies and blockchain are the talk of the town, and the number of companies using these technologies is growing exponentially. Businesses in the gaming industry are among the largest adopters of crypto since they understand the potential of this innovative solution. Security, speed of transactions, and low fees are the primary reasons why developers of games are starting to switch to fiat alternatives. The success of projects such as Axie Infinity and BitStarz demonstrates that there is certainly a place for cryptocurrencies and blockchain in the future of the gaming industry.