According to a recent industry report, there are nearly 3 billion gamers in the world today, and – in 2020 alone – they will spend nearly $160 billion on games.
These numbers reinforce one inescapable fact: people love playing video games.
No corporation knows this better than video-streaming giant Netflix. In a letter to shareholders last year, Netflix told investors it wasn’t looking over its shoulder at the competition coming from other streaming services like Hulu or HBO Max. No, Netflix said it is far more concerned about competing with Fortnite, a shooting game that now commands the attention of 200 million players.
The raging success of Fortnite – and its parent company Epic Games – not only has Netflix a little nervous; it has also put other gaming giants on notice.
It might explain why Ubisoft – the company that introduced Assassin’s Creed, a gaming franchise valued at more than $300 million – recently announced it is now recruiting blockchain startups in its incubator program.
Why would a gaming company want to expand into blockchain? According to Ubisoft, “We … see a nascent ecosystem flourishing in many different directions exploring new possibilities to envision the relationships with the gamers, and between them, virtual assets ownership and exchanges, transaction security, and all what a cryptocurrency can allow.”
Exactly. Blockchain gives gamers something they have never had: the opportunity to take total ownership of the many rewards they earn or purchase while playing games. Ask any gamer, these items are costly – both in terms of money and hard work – but they have little value outside of the centralized game.
Blockchain is about to change all that.
Full transparency: I come at this from two different perspectives. One, I am a tech entrepreneur who incubates blockchain gaming startups. But, two – and maybe more importantly – I am the father of five gamers.
Because I’ve raised a family of gamers, I have developed an understanding of gaming that goes beyond earnings reports. I’ve watched my kids get swept up in a wide variety of games over the years. I saw exactly why Sims (the most popular game of all time based on unit sales) captured their attention. I also understand why Call of Duty, a first-person shooter game introduced in 2003, mushroomed into a franchise now valued at $130 billion. Mega-gaming hits like Minecraft and Halo were also big hits in my living room.
How does watching kids play games enhance my understanding of the gaming industry? Because I saw how each of these highly successful games won over gamers: they leveraged the latest technology to deliver a completely engrossing experience.
And that is what is happening right now with blockchain games; because they can be powered by non-fungible tokens (NFTs), they hold the potential upend the entire gaming industry.
Blockchain-based games can deliver an unprecedented, fully immersive experience. Those costly, hard-earned rewards I mentioned earlier can suddenly take on real value in a blockchain environment. That’s because a gaming collectible purchased or won in one game can now be transferred to another blockchain game. That means, for the first time, those rewards become the property of the gamer, not the game.
This transferability means gaming rewards can accumulate genuine value. They can be bought and sold in blockchain-supported marketplaces for fiat dollars, cryptocurrencies – or exchanged for other NFTs. And guess what. That also means – for the first time – gamers may even earn real money playing games.
And, as a parent of gamers, that last value proposition is music to my ears. Conservatively speaking, I estimate I’ve spent about $50,000 in gaming over the years. Blockchain games represent the first potential opportunity I have seen to recoup some of that investment.
This potential is already coming to fruition. CryptoKitties – a 2017 blockchain game where users are invited create, trade, and sell digital cats – already has more than 1 million users who have completed $40 million worth of transactions.
As an entrepreneur, the success of CryptoKitties validates my enthusiasm for blockchain games, but so does the experience of watching my 16-year old daughter play another blockchain-based game – Axie Infinity – the other night. She couldn’t put it down and I knew I was witnessing the future of gaming.
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Brad Robertson is the founder and CEO of Polyient Labs, an early-stage blockchain startup incubator. He has been an entrepreneur in the tech field for more than 20 years and he earned his JD from Pepperdine University.