It’s Game on for Crypto
Gaming and cryptocurrency have plenty in common and buzz of the two mergings are already big. Despite current challenges, forging a mutually profitable partnership is only a matter of time
It’s no secret that gaming is huge. Gaming market revenues are currently estimated at over $152 billion in 2019, with predictions of reaching $230 billion by 2022.
Gaming Connection to Crypto
While cryptocurrency is certainly making waves and the public is warming to the concept of digital currency, the coveted mainstream adoption is still far off. It’s common to hear that crypto needs a “killer app” as a vehicle to drive that adoption, and gaming just might be it.
The two industries share a similar demographic — the average gamer as well as the average Bitcoin owner tends to be a millennial male — one that is comfortable adopting new tech, even where concerning the most fundamental of life’s essentials, money. Crypto also has something akin to a fanbase, with its own lingo and heros, intriguing strategies, heated debates, and impassioned predictions. There is even an element of gamification to how cryptocurrency is produced, as most digital currencies include a reward system for participation in the mining process.
How Can Crypto Gain From Gaming
The crypto market could stand to gain immensely by tapping into the gaming industry’s success, and the feeling from gaming seems to be mutual. Gaming giant Electronic Arts caused a stir on Twitter recently with a play on the phrase “invest in Crypto.” The tweet was actually a brilliant marketing ploy leveraging cryptocurrency hype on social media to tease a new character named Crypto for its Fornite style shooter, Apex Legends. And speaking of Fortnite, Tim Sweeney, CEO of Epic Games, the company that owns that enormously popular battle royale game, tweeted support for cryptocurrency earlier this year.
One obvious benefit that crypto has to offer game developers is an ideal solution for online purchases. In-game transactions make up the lion’s share of gaming revenues and using digital currency for payments could reduce the cost of these transactions substantially. And, of course, crypto’s privacy and security are far superior to credit card payments when it comes to dodging hackers.
Gaming and dApps
dApp games built on the blockchain would greatly simplify monetization, through in-game tokens, assets, skins, and other virtual items created as part of the game’s design — a lucrative sub-industry estimated to be worth $50 billion. Third-party marketplaces for these items are very problematic: authenticating virtual items is difficult and customers risk getting scammed, in addition to the risks and hassle of payment transactions, many of which are international and involve banking bureaucracy. By building games with blockchain technology, developers could bring such transactions inside the game itself, eliminating these issues.
Although scalability has been a barrier, with blockchain networks struggling to keep up with the sheer quantity of transactions (such as what happened with Ethereum and CryptoKitties in 2017), newer blockchains are now busy addressing these challenges. Ripple is currently leading the charge, with its $100 million project with Forte dedicated to blockchain-based games. It’s only a matter of time until the technical kinks get ironed out, opening up a world of partnership possibilities for the gaming and crypto markets.