Since it raised concerns about technology and investing, cryptocurrency has been a topic of much discussion in recent years. The application of blockchain technology to gaming is another recent development in this area.
What are blockchain games? Learn more about blockchain gaming in the following paragraphs, including how it operates, its risks, and how to get started with some of the best blockchain games.
What Is Blockchain Technology, And How Does It Apply To Gaming?
Blockchain is a distributed, decentralized digital ledger that permits safe transactions and preserves records. It has produced a brand-new gaming experience for both players and businesses who use NFTs and cryptocurrencies to buy in-game items that can be converted into real money. For instance, millions of players worldwide use Ethereum-based cryptocurrencies in Axie Infinity.
Since most gaming platforms are centralized, players can only use their in-game currency or XP in one particular game. Blockchain games, on the other hand, employ a decentralized model, allowing players to own their game data and use it in other blockchain games.
When a user leaves a blockchain game where they have won XP and weapons, for instance, they can choose to transfer their winnings to another game. They could also exchange them or sell them to another player.
What Exactly Is Cryptogaming?
The centralization of traditional games prevents all items and experience (XP) earned from playing from being used in other games. Blockchain technology, which is used in cryptocurrency gaming, alters this. Now, players can use their rewards and items on various cryptocurrency gaming projects.
Additionally, players can make money through cryptocurrency gaming. Players can participate in what is known as a “play-to-earn model” in a number of different ways. Take Axie Infinity, for example. Axies are characters that users can purchase, level up, and then sell for more money. To earn SLP and AXS, two Ethereum-based crypto gaming tokens, players can engage in combat with their Axies.
This introduces a brand-new component to the market: the notion that gamers can earn cryptocurrency while playing games. This is a positive development, according to research by the Worldwide Asset Exchange, as three out of four gamers said they wished they could use their currency across different platforms. But are only gamers playing?
Who Engages In Blockchain Gaming?
Blockchain games are played by many different types of people. Over two million people play the top three blockchain games each month. The U.S. is where most users reside. or the countries in the Asia-Pacific region, including the Philippines, China, Thailand, Indonesia, India, and Vietnam.
Millennials between the ages of 25 and 34 make up about 37% of crypto gamers, followed by Gen Z between the ages of 18 and 24 at about 27%. Users over 65 and those between the ages of 45 and 54, however, have experienced the greatest recent monthly growth.
Successful Crypto Games
It’s no surprise that Axie Infinity became popular in the Philippines, as the game has Asian origins. Vietnam-based Trung Nguyen founded the game startup Sky Mavis, which unveiled the Ethereum-based game. Sky Mavis’s valuation was just under $3 billion as of December 2021, which is amazing considering that the company had only recently raised $152 million in seed funding from cryptocurrency investors in October 2021.
Despite the valuation, Axie Infinity is only the second most popular crypto game, beaten by Alien Worlds, which attracts more than 1.16m monthly users, almost double that of Axie. The game’s co-founder, Saro McKenna, has a background in corporate finance and has spent ten years working there. McKenna also has an Oxford University MA.
Although Alien Worlds is more popular than Axie Infinity, the in-game currency tells a different story. The price of the Axie Infinity token (AXS) as of June 27, 2022, was $16.13, down 14% over the previous 30-day period. When comparing all gaming cryptocurrencies based on market capitalization, it is ranked fifth, below Decentraland and The Sandbox. With a price of just $0.02, Alien Worlds (TLM) is considerably cheaper.
Blockchain Game Risks
Even though blockchain gaming may seem like a fun way to earn some extra money, there are a few things to consider before you start. First, some games have obstacles for people with disabilities. Users must have three Axies, which can cost up to $300, in order to start playing Axie Infinity, for instance.
You run the risk of losing some of your cryptocurrency or tokens. The CEO of Hedgie, for instance, lost more than $1 million in NFTs as a result of a scam, and Axie Infinity’s Ronin blockchain was compromised for more than $600 million.
Fraud may be more prevalent in games than in simple cryptocurrency trading because blockchain gamers are exempt from some financial standards, like anti-money-laundering regulations.
Finally, players may experience financial losses as a result of common market fluctuations. The risk that players won’t be able to make withdrawals in time to reduce their loss, however, increases because some games have restrictions on how frequently players can withdraw their tokens.
In What Ways Can Players Make Money?
The game’s in-game currency, which is a cryptocurrency, can be exchanged for real money, allowing players to profit from their play. These transactions are typically made possible by centralized exchanges like Binance, where users transfer their cryptocurrency, trade it for the relevant fiat currency, and then withdraw their funds to a digital wallet or bank account. This freedom enables players to cash out without any restrictions and extract some of the economic value they have generated through gaming. In some instances, the cryptocurrency itself gains widespread acceptance and real-world retailers begin to accept it as a form of payment.
Conclusion
Blockchain gaming technology enables players to develop their characters, add to them, and make them stand out from other players. Along with trading them on the platform, they can transfer them to other users. Due to this distinctive feature, users are drawn to blockchain gaming because they can independently play while owning the game assets.
