About NFT Games
What is NFT Game?
What are NFT games in the present gaming market?
What are the impacts of NFT games on players, producers, artists, and the gaming market?
NFT games, as a subset of P2E (Play-to-Earn) games, offer users a chance to earn or collect unique digital items or assets (NFTs) that are stored on a blockchain. The players can trade, collect, and showcase their in-game items, often with real-world value.
With the growing popularity, those P2E converts, after experiencing asset ownership, they cannot fathom any other way of gaming. Because players in the past may pay an amount of money for a game, but now with those P2E games, they are questioning why others would spend a lot of money in a game, buying assets, and skins, when they can earn and sell the assets for more later to earn a financial return in P2E games.
Different Categories of NFT Games
There are various NFT games, and new categories are likely to emerge as the NFT games continue growing.
Players can collect and trade unique digital assets that are represented as in-game NFTs. The values of these digital assets are determined by their scarcity and uniqueness.
One of the most well-known examples of a collectible NFT game, also the first NFT game is CryptoKitties. In CryptoKitties, players buy, breed and trade virtual cats with different visual features of varying levels or rarity. Players must purchase Ether cryptocurrency to join the game and spend it on each breeding and trading action in the game. The virtual cats can give birth to new cats, and they all carry a unique number and 256-bit distinct genome with DNA and different attributes (cattributes in the game) that can pass to offspring. And the cattributes include pattern, mouth shape, fur, eye shape, eye color, base color, accent color, highlight color, and optional cattributes such as wild, environment, “purrstige”, and “secret”. Cats do not have a permanently assigned gender, each cat can be either matron or sire, and every cat can breed in one breeding session at one time. The game has no goal, and the virtual cats are static images that can only be purchased, bred and sold.
Axie Infinity is the largest and one of the most well-known NFT games where players collect and raise digital creatures called Axies. To play Axie Infinity, players need to set up a wallet that supports the Ethereum blockchain to store Axies and make transactions in the game. Then players need to purchase one or more Axies in the marketplace to participate. Then they will raise and care for the Axies and made Axies participate in battles. Each Axies have unique states and abilities that players need to manage and upgrade to win battles against other players. Those Axies can be traded and sold on the Axie marketplace. Additionally, players can explore and interact with the virtual world in Axie Infinity, for example, visiting others’ gardens.
Virtual World Games
Players can interact with and own virtual assets in a shared virtual world. These assets could include land, buildings, and items, and their value is determined by their location, scarcity, and uniqueness.
Decentraland is a popular virtual world game, in which players can purchase virtual land, create on their own, and trade land, assets, and tools in the game. Players should set up a wallet that supports the Ethereum blockchain to store virtual assets and allow transactions within the game. Decentraland is divided into parcels of virtual land (LAND in the game). Players need to purchase one or more parcels of LAND using Ethereum blockchain by visiting the marketplace. Once players own LAND, they can create and build their own virtual world with tools and assets. Players can also explore and interact with other players’ virtual worlds and participate in games and experiences, attend events and explore the vast virtual world. All virtual assets are unique, and players can trade their LAND, virtual items, and other assets with other players or sell them on the Decentraland open market.
These games combine elements of strategy and adventure, allowing players to collect and trade unique assets, explore virtual worlds, and compete against other players.
Splinterlands is an example. Before joining the game, players should set up a Steem account to store virtual assets and make transactions in the game. Then they need to purchase cards through the marketplace or directly buy booster packs from the game. With cards, players can play one-on-one matches against other players. Players need to build a balanced and effective strategy among the cards. During each match, players should attack or defend against the opponent's creatures and spells. The first player that reduces the opponent’s health to zero will win the match. Playing matches, winning tournaments, and selling cards can all earn rewards.
Impacts of NFT Games
NFT games allow players to truly own their virtual assets, for they are backed by blockchain technology. Players have more control over their virtual experiences and the ability to trade their in-game items and assets and earn real-world money. Take Axie Infinity as an example, some of the players earned a decent amount of income through playing. In the documentary, a Pilipino player stated that he moved from a hub to a house because of playing the game. NFT games also have the potential to increase player engagement, as players have a stake in the game and are incentivized to play and participate.
However, there is part of people who speculated the whole thing could be a giant bubble. And they worried that if NFT becomes unprofitable, are those assets and values in the game still valuable? The uncertainty about whether NFT will be an economic bubble that may collapse at some point comes precisely from the continued madness of acquiring NFTs and a potential over-speculation and herding in NFT investing.
Also, the low accessibility and high complexity of NFT games prevent part of the potential players. The cost of entry for an NFT game can be high. Almost every NFT games require a wallet for in-gaming purchases and transactions. And some games require players to purchase NFTs before the game to participate. For those who cannot afford to purchase these in-gaming items, NFT games create a sense of unfairness and exclusion. Additionally, transactions on the blockchain can incur high fees, which will make it expensive for players to participate in NFT games. As a relatively new and unregulated market, NFT games create opportunities for scams and fraud, where players may fall victim to fraudulent sellers, fake NFTs, or phishing scams.
NFT games can create a new revenue stream for game producers, as players can buy, sell, and trade unique in-game assets. This can also incentivize players to spend more money on the game in order to obtain these assets. The use of blockchain technology can also improve the security and transparency of the game, making it more difficult for players to hack or cheat. Additionally, NFT games may attract attention from investors and blockchain enthusiasts, and potentially leading to more funding and partnerships.
Developing an NFT game can be costly and time-consuming, requiring expertise in blockchain technology and smart contracts. It can also be difficult to predict the success of an NFT game, as it depends on various factors, such as the quality of the game, the popularity of the assets, and the overall market for NFTs. Additionally, some players may be put off by the perceived pay-to-win nature of NFT games, which may affect the game's popularity and revenue potential.
NFT games can provide a new platform for artists to showcase their work and potentially earn revenue from the sale of their in-game creations. This can be especially valuable for emerging artists who may not have as many opportunities to showcase their work. Additionally, the use of blockchain technology can help prevent unauthorized use of their work, which can be important for protecting their intellectual property rights.
Some artists may not be comfortable with the technical and legal aspects of creating and selling NFTs, which can be complex and require knowledge of blockchain technology and smart contracts. Additionally, the NFT market can be volatile and speculative, making it difficult to predict the value of an artist's NFTs over time. This can create uncertainty and financial risk for artists who invest time and resources into creating NFTs.
NFT games are driving innovation in the gaming industry, as developers are exploring new business models, gameplay mechanics, and economic systems. This can lead to increased competition and a higher quality of games. They can also attract new players who are interested in the unique features of NFT games, potentially expanding the gaming market.
The rise of NFT games could potentially have a negative impact on the traditional gaming market, as players may shift their attention and spending toward NFT games, leaving traditional games behind. This could lead to a decline in the quality and diversity of traditional games. “90 percent of people will not play a video game unless they are being properly valued within the next five years”, said Alexis Ohanian, the founder of Reddit, “In five years, you will actually value your time properly, and instead of being harvested for advertisements or being fleeced for dollars to buy stupid hammers you don’t actually own, you will be playing some on-chain equivalent game that will be just as fun, but you’ll actually earn value, and you will be the harvester.”
Will NFT games create a new form of labor in the future?
The emergence of NFT games has raised concerns about the exploitation of gamers, who are increasingly being forced to devote long hours and significant resources to these games in order to make a living. This trend transforms the game from a form of entertainment and leisure into a new type of occupation. Players may constantly be under high pressure to win and produce real-world value. Also, those gamers are frequently required to invest a significant amount of money in participating in the most competitive rounds. As such, the allure of NFT games may be more akin to the appeal of gambling than to the fun of gaming. NFT games may create a new kind of digital labor that is both financially and psychologically harmful. In light of these concerns, it is important to develop strategies to protect gamers from the negative consequences of this emerging form of work.
What could we do?
The gaming industry can adopt more ethical business practices. For example, limiting the amount of money that players can spend in the game and implementing a fairer reward structure that does not disproportionately benefit the most financially invested players.
The government could enact laws to regulate the exploitation of those new digital labor. Ensure that digital labor is protected as traditional forms of work, such as minimum wage requirements and overtime pay.
It is important for the public to be aware of the potential risks associated with NFT games and to take steps to protect themselves. They can educate themselves about the risks of addiction and financial exploitation associated with NFT games, as well as advocate for better protections and regulations in the industry.
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