Chris used to spend hours a day playing video games, but stopped after deciding they were taking up too much of his time. But when he saw Axie Infinity last May, he was hooked. Inspired by Pokémon, Axie Infinity is a video game about training and fighting monsters. That sounds like a million other games, but one thing makes Axie Infinity atypical: it’s built on the blockchain.
Axies are the Pokémon from Axie Infinity, but they are owned by NFT. Players earn a cryptocurrency called Smooth Love Potion by fighting them. You can breed Axies, which you can then fight or sell. Chris, who refused to give his real name and goes only by the pseudonym Cryptobarbarian, felt he could justify playing video games again, as long as he paid.
“It was fun for the first few weeks, but it gets boring very quickly,” the 28-year-old said. “From there, he says, Axie Infinity became just about making money.”
Axie Infinity is a browser game. It’s free to access, but you need to purchase a team of three Axies in order to play. At their peak of popularity, the lower-tier Axies cost around $350 each, meaning playing the game once required a four-figure investment. However, the game allows Axie owners to lease their monsters to other players. Cryptobarbarian, a longtime cryptocurrency investor, told me that he bought $30,000 worth of Axies and loaned them out in exchange for 40% to 70% of the profits. (CNET was unable to verify your purchases.)
The strategy paid off at first. Axie Infinity was a hot ticket on CryptoTown, bringing in more than $10 million per day this past August. But thanks to a combination of poor in-game economics, inflation threatening the real-world economy, and a $600 million hack allegedly caused by a fake job posting, the price of Axies and the in-game cryptocurrency crashed.
“I have about 100 players playing high-end Axies for me,” Cryptobarbarian told me via Twitter, “which were typically around $100,000 at the height and now worth nothing.”
For gamers, stories like this provide ample reason to shun “Web3 gaming,” a term that refers to the integration of NFTs and cryptocurrencies into games. The significant carbon footprint of ethereum and bitcoin adds to the resentment. Whether it’s Ubisoft bringing NFTs to Ghost Recon or Square Enix investing in cryptocurrency technology, gamers have fiercely resisted blockchain coming to their industry.
The fear is that cryptocurrencies and NFTs will warp gaming into a side hustle, transforming its purpose from entertainment to making money. Play-to-win titles like Axie Infinity prove the point; they are not so much games as financial speculations in the guise of gambling.
“I’ve never met anyone who played just for fun,” Cryptobarbarian said of Axie Infinity, “just to make money.”
But Axie Infinity doesn’t represent the future many Web3 developers envision for gaming. Video game companies, both small and large, are developing titles that they hope will wipe the slate clean from Web3 games. They are all on carbon neutral blockchains like polygon or solana which are much more efficient than ethereum. (Whether they are so safe is an open question.) The goal is not to create titles that entertain crypto speculators, but to make the games fun enough that people can justify playing them regardless of whether they earn crypto or not.
“I have long believed that gaming is one of the internet consumption categories most likely to drive mainstream cryptocurrency adoption,” said Amy Wu, director of gaming at FTX Ventures, the investment arm of the cryptocurrency exchange. FTX cryptocurrencies. “But I also think that when you have a successful game with Web3 elements, it’s very likely that most players will never exchange those tokens. They’re just playing.”
Free to play, play to own
The next wave of Web3 games will range from free-to-play mobile titles to big-budget AAA games for PC and consoles. At the simpler end of the scale is Shatterpoint. With an art style inspired by Legend of Zelda: Breath of the Wild, it’s an action RPG for Android and iOS that, on paper, resembles many of the best games on the App Store. There is a single player campaign plus a PvP multiplayer mode. You gain new weapons and gear as you progress, and much like Fortnite and Call of Duty, multiplayer is divided into different “seasons.”
But these seasons, segmented by “the break” in the game, is where the blockchain comes into play. Players will receive a certain list of objectives each season. To see also : 10 Foods That Look Mainly In Video Games. If they complete one, for example being one of the first 100 players to reach level 50 or staying at the top of the PvP leaderboard for a certain amount of time, their character will become an NFT. Only a limited number of NFTs will be minted per season.
There are two reasons why players might want to bother scoring an NFT. Destruction acts as a reset to the game, so any gear you’ve collected will be gone. NFT characters, of which there will be a limited number each season, are permanent. Regardless of what your character looks like when minted into an NFT, with any combination of gear equipped, this is what they’ll look like in perpetuity. The second benefit is that these NFTs can be sold in a market, if there is a market for them.
A screenshot of Shatterpoint.
There are three crucial elements that make this model sustainable, says Shatterpoint developer Benas Baltramiejunas. First, the game is free to play, unlike P2E games like Axie Infinity, which require the initial cost of three Axie NFTs. Second, none of the items held as NFTs can resemble pay-to-win mechanics. There can only be cosmetic benefits to owning it, not a competitive advantage. Lastly, and most importantly, the game is designed with the assumption that most people playing the game won’t be interested in coining their character an NFT. It has to be fun for them too.
“We’re using the NFT approach to create a little bit of competition, to incentivize players to play,” he said. Shatterpoint is monetized through traditional microtransactions and by taking a small cut of NFT sales – 2.5% is the traditional cut taken by creators. Baltramiejunas hopes that focusing on NFTs will result in better game design and fairer pricing. If developers can create a compelling game, the revenue can theoretically be sorted organically through whatever the player base establishes as the value of NFTs.
“On free games you have whales that represent 10% of the player base but 90% of the revenue,” Baltramiejunas said. “If you only have those microtransactions for monetization, you’re only targeting those whales during content creation and you’re leaving everyone behind. However, with the NFT integration, you don’t need to monetize as aggressively. The market decides.”
NFT brands expand into gaming
While Shatterpoint is an NFT-producing mobile game, the next few years will see many examples of the opposite: NFT collections becoming games. NFT launches such as the famous Bored Ape Yacht Club are doubling down as crowdfunding platforms that produce games. Creators earn millions in royalties from sales and use that money to expand the brand, theoretically driving up NFT prices in the process. To see also : Neon White wouldn’t be “weird” without Machine Girl music. Some brands are expanding into television and film. Many are dabbling in gaming.
An example of this is My Pet Hooligan. It is a product of AMGI Studios, an animation studio where former Pixar animator Colin Brady serves as chief technology and creative officer. The studio sees Unreal Engine 5 and blockchain technology as the next technologies to power entertainment, Brady told me at the recent NFT.NYC conference.
AMGI Studios’ goal for 2021 was to use Unreal Engine 5 to create an animated movie for Netflix at half the traditional cost. As the film was being greenlit, Brady explained, AMGI technical lead Kevin Mack approached him about starting a collection of NFTs.
The result was My Pet Hooligan, a set of 8,888 3D rabbits. “We sold out in less than a minute, and all of a sudden people were like, ‘Hey, when movie? When TV show? When video game?'” Brady said. “So we said, actually we already have a studio full of Unreal Engine programmers, let’s try to make a game.”
The result is Rabbit Hole, a sandbox game that looks like a cross between Grand Theft Auto and Ratchet and Clank. Rabbit Hole is currently in closed alpha, available only to My Pet Hooligan NFT holders with only a working map. The build of the game I saw on NFT.NYC was intriguing. It was certainly incomplete, with noticeable frame rate issues, but it had the clear foundation of a fun sandbox game.
My Pet Hooligan’s NFT on the OpenSea marketplace.
Rabbit Hole will eventually be available on PC and console. Brady says the goal is to reach 1 million players by the end of the year. He describes it as a virtual Disneyland, less of a game and more of a place to socialize, the way people use Roblox and Fortnite. To that end, the studio developed a facial recognition companion app for phones. If you place your phone where a webcam would normally be on a computer, it will track your face and replicate all facial movements on your on-screen Hooligan.
Unlike Shatterpoint, which will integrate only NFT, Rabbit Hole will use both NFT and crypto. It will have a play-to-win mechanic, or play-to-win, as technical lead Kevin Mack prefers to say, in the form of carrots in the in-game currency. These will be used to buy clothes, dances, and more for the Hooligan avatars, but it also functions as a cryptocurrency that can be exchanged for ether or bitcoin. You can make money playing Rabbit Hole, but Brady said it’s not going to be life-changing money.
“We think you should be able to jump into the game and start playing as a generic Hooligan,” he said. “You start winning Carrots, and then maybe in a couple of months you realize, ‘wait a second, I made a hundred dollars on Carrots.'”
Then there is the NFT item. This is set for holders of the 8,888 NFTs of My Pet Hooligan. While players who download the game will start out with a generic Hooligan, My Pet Hooligan owners will be able to use their NFT as an in-game avatar.
If the game becomes popular enough, Mack said, there will be some prestige in owning one of these avatars. But he acknowledges that for that to happen, the team has to make a game that people actually want to play.
“Superman No. 1 is valuable because Superman was a great comic,” he said. “I think the NFT space for a while started to go back a little bit, where they thought things were valuable just because they were collectible.”
To infinity…
Of all the NFT brands expanding into gaming, Bored Ape Yacht Club is the largest. BAYC creators Yuga Labs are developing Otherside, a “metaverse” MMORPG. The term “metaverse” is confusing, but in this case it refers to an open world where items are owned as NFTs and the in-game currency is crypto that can be exchanged for dollars. This may interest you : 10 Best Anime -Based Video Games | Eye Watch. Details on Otherside are scarce, but Yuga has quite the war chest for it. The game map will be made up of 200,000 parcels of land, which players can buy and own. More than $350 million was raised from the land sale in May.
Another side may be the highest budget Web3 game, but perhaps the most ambitious is Star Atlas.
In development since 2020, Star Atlas, inspired by Eve Online, is designed like a traditional AAA game. Michael Wagner, CEO of Star Atlas development studio ATMTA, told me that there are around 200 developers working on the game. Its launch is scheduled for 2026.
Like Eve Online, Star Atlas is part game, part space simulator. Players travel in spaceships through the galaxy, socialize and fight with each other, explore exoplanets, mine land and meteorites for resources, etc.
Games like Eve Online are gigantic, big enough for players to miss out on for years. Star Atlas hopes to mimic that feat. To do so, it uses almost all the new tools that Web3 offers.
It starts with financing. Wagner said $185 million in revenue was raised in 2021, through the sale of an Atlas token and NFT ships, with a “substantial margin” from that funding development. In the game, ships, items and land will be owned by NFT. There will be a comprehensive crypto economy built on top of gaming, which Wagner says will enable not only a market, but also a labor economy. The economy is not only in the game; Part of Star Atlas will be built on the blockchain, meaning elements will be open source. People will be able to build applications on top of this data, for things like spacecraft maintenance or resource management.
Part of the Star Atlas economy will involve taxes. Just like in real life, a certain percentage of all sales will go into a treasury. There will be a DAO, or decentralized autonomous organization, in which token holders can vote on how these funds are used, whether it is to fund a new marketing campaign or a user engagement campaign. There will then be another DAO specifically for the game itself, where token holders can vote on changes to the game, such as additional features or ways to balance combat.
“We have structured the DAO economy in a way that we don’t lose control anytime soon,” Wagner said. “But in the future, it would even be possible for them to remove us as the main developer of the game and bring in someone new if they think they can deliver the product to us in a superior way.”
Risks and rewards
The potential of Web3 games is tremendous, but the challenges are enormous. A review of Star Atlas alone highlights many problems Web3 developers are likely to face.
First of all, making video games is hard. Making high-quality AAA games is even more difficult, even for veteran game studios, and the Star Atlas game alone is bold in its ambition. Web3 components offer an additional opportunity for failure: an unbalanced economy, for example, has the potential to completely break the game. Then there is security and regulation. Crypto has been a digital wild west for years, with scams endemic. Regulators are slowly changing that. It is an open question whether Web3 games can survive in a regulated environment.
“In many countries, consumer protection is the main driver of regulations. Since gaming is so mainstream, it will be an issue,” said Wu of FTX Ventures. “100%, these assets are going to be regulated.”
The final problem is the very product that fuels crypto tokens and NFT projects: hype. Games are often promised in NFT project roadmaps before a single second of development has taken place. As Brady pointed out, it took less than a day for My Pet Hooligan holders to demand an ad for a game, movie, or TV show to keep the publicity up and increase the value of NFTs. Vaporware is sure to be common.
Games will need to be developed in a way that isolates players from crypto speculators. Speculators who outbid each other can artificially increase the value of game items, blocking access to players who actually want to play. Remember the speculative bubble that caused the cost of entry to Axie Infinity to balloon to over $1,000.
“I’m personally not interested in someone paying $100,000 for an NFT,” Brady said. “That’s a certain stepping stone. That’s not a normal society. I’m only interested in whether this helps all people.”
Of all the developers I spoke to, a recurring theme was a distrust of any game company that promised a regular income or offered the chance to earn enough money to get out of the rat race. “Playing to win is not sustainable and is going to disappear,” Baltramiejunas said. Instead, the goal is for Web3 games to be more engaging than the games you play today, with the benefit of some extra money.
“If the game was good, I’d be happy with a little bit of money as long as it’s not a waste of time,” Cryptobarbarian said, pondering how much money he would need to earn to justify playing games again.
“If I could make some lunch money off of it, that would be nice. But I think it’s going to take at least a few more years before that happens.”
Do you own the copyright to an NFT?
Since 2021, NFTs have become popular with the masses, bringing art and technology together. When buying NFT, the work is not property, but the metadata, says an expert in intellectual property law. With the current hype surrounding NFTs, the idea of copyright seems to create confusion and gray areas.
Does NFT prove ownership? You can easily prove that you own it. Proving that you own an NFT is very similar to proving that you have ETH in your account. For example, let’s say you buy an NFT and ownership of the unique token is transferred to your wallet via your public address. The token proves that your copy of the digital file is the original.
Is NFT subject to copyright?
Unless specifically granted to someone else, the copyright remains with the creator. Copyright law has been around for decades and applies to NFTs.
When you buy an NFT Do you own it?
Andres Guadamuz. Since 2021, NFTs have become popular with the masses, bringing art and technology together. When buying NFT, the work is not property, but the metadata, says an expert in intellectual property law.
Why are NFTs in video games bad?
In some cases, they can sell for hundreds or thousands of dollars, making them a lucrative way for a game company to raise cash. The money-raising potential is why some players and even developers argue that NFTs are a scam involving virtual items that have no real-world value.
Are NFTs bad for gaming? Digital assets such as NFTs are an innovative way to use security to support game monetization and provide some additional collectability for players. But that only works if the system is really secure. And that some NFT games can generate positive revenue for players, like Axie does, is an intriguing prospect.
Are NFTs a failure?
A failed NFT project is a collection that declines in trading volume and its floor price drops by more than 60% or between 0.05 and 0.01 ETH has likely failed. A failed nft project typically has a minimum nft price loss of 90% or more in less than six months and is a failed project.
Why are NFTs a bad idea?
Coining an image like NFT reduces that image to its financial potential, further removing it from its context as a socially engaged cultural artifact.
Why do gamers dislike NFTs?
Players have been decrying the play-to-win nature of loot boxes and DLC ever since the notions were first introduced, and for good reason. It allows developers to give an unfair advantage to those who are willing to pay for it and encourages a gambling-like addiction to stumbling upon a loot box with rare items.
Why do gamers hate NFT?
Players have been decrying the play-to-win nature of loot boxes and DLC ever since the notions were first introduced, and for good reason. It allows developers to give an unfair advantage to those who are willing to pay for it and encourages a gambling-like addiction to stumbling upon a loot box with rare items.
Is NFT worth nothing? The value of NFTs comes from the idea that the digital certificate of ownership is valuable in itself. The digital asset, like a work of art, is not valuable. The only value in NFTs comes from the hope that one day you can sell them for a higher price. It is an asset that exists to make more money.
What is the point of NFT games?
The simple answer is that NFT games allow users to earn money while playing. Combining video games with finance, or GameFi as gamers call it, these games use NFTs (unique digital collectibles on the blockchain) that players can sell in games to other collectors and gamers.
Why do artists hate NFT?
The artist told us that NFTs seem to consume too much power and are riddled with theft. Those concerns have led some creative types, like Clarfy, to stay in the shadows of the internet, to make sure their creations aren’t misappropriated.
Why artists should not do NFTs?
The artist told us that NFTs seem to consume too much power and are riddled with theft. Those concerns have led some creative types, like Clarfy, to stay in the shadows of the internet, to make sure their creations aren’t misappropriated.
Why do NFTs fail? A failed nft collection can be due to external and internal factors. For example, if developers and teammates pause production, it can cause a crash, also known as a “rug pull.” ‘
Why NFTs are not good for artists?
Artists should also be on the lookout for phishing attacks from people who want to hijack their accounts to power NFTs. Another artist told us that these schemes are “generally the reason most artists block NFT accounts in plain sight.” In short, that’s a lot of bad news for artists who don’t want to get into the NFT ecosystem.
What are the cons of NFTs?
Cons of NFTs
- Physical art cannot be digitized. The reasons for owning physical art and the reasons for owning digital art are often different. Physical art cannot be digitized. …
- uncertain value. Even for experts, NFTs are confusing assets. …
- Environmental cost. The environment is a hot topic of debate in recent times.
Are NFTs actually good for artists?
The NFT is not necessarily the artwork itself, but can function as a digital certificate of authenticity for the artwork. The NFT allows a creator to name the rightful owner of a file, giving them the rights to display, access or resell it. In the digital art space, this is a beneficial technology.
