In this blog article, we would like to explore the applications and advantages of NFTs in Gaming, so we can supply our community with more information and useful content before Seedify.fund NFT-Gaming Ideathon.
If it’s your first time coming across the word ‘NFT’, or you don’t know what it really stand for, it means “Non-fungible Tokens”.
There are two types of tokens, which are; Fungible and Non-fungible Tokens.
What are Fungible Tokens (FT) and Non-Fungible Tokens (NFT)?
NFT is a type of token that is distinct from each other and cannot be interchanged. Each NFT has a unique ID which is created for specific purposes.
Fungible tokens on the other hand, are tokens that are interchangeable, and not distinct from each other.
NFTs are used within the game to represent or buy in-game items like avatars, game rewards, weapons, lands and more, giving them real value and making them to actually exist in digital form on blockchain, so that you can transfer and trade them.
NFTs in Gaming
NFTs in Gaming is all about creating value for the users and giving them real ownership rights over their acquired in-game components by making these components valuable digital assets, tradeable within the cryptocurrency market, NFT marketplaces, and making the game itself have a real life feeling and value.
Witek Radomski, a co-founder of Enjin Coin, was the one who developed the first known non-fungible token. He wrote the code for the first NFT back in June 2017 and was released to the public in August. Since then, there has been growing mainstream adoption of NFTs and awareness globally.
NFTs are taking the gaming industry to a whole new level providing many new benefits that will completely revolutionize it both for players and game developers.
How Does it Work?
It is quite simple, NFT is used to represent in-game collectibles that give them a digital existence. It also makes the game to be as real as possible. Below are more ways NFT is applicable to gaming;
- Payment of rewards: Players are able to get real value for the rewards they acquire from games and can easily transfer these rewards to others. This is made possible through non — custodial wallet providers such as Trust wallet, Metamask etc which can be traded on OpenSea, Worldwide Asset eXchange (WAX) etc.
- In-game collectibles like unique weapons, avatars, items, lands and anything else that can be earned or purchased within a particular game.
- Identification and valuation of game items.
- Identification of game characters and game names.
Advantages of NFTs in Gaming
- In-Game Asset Ownership and Control:
The use of NFTs in gaming enables the user to own the game collectibles and all items you can own within the game and you also have full control of it in a decentralized system.
This is not the case in the traditional gaming system where you can only view your game assets, no matter how much you paid for it.
Additionally, each of the items can have a unique identity that will be pegged to your account as long as you own them and you cannot lose them if the game provider shuts down the game because it is within your wallets. This allows the users to securely store his assets without fear of theft.
Also, monetizing assets, and trading them on the marketplaces in exchange for crypto or fiat are other great benefits of NFT ownership.
- Transfer of Ownership:
A player can sell his game collectibles at any time he chooses to, and get value for them. This makes the buyer to be the current owner through transfer of ownership and it is updated on blockchain.
- Security and Uniqueness:
Assets cannot be duplicated because they are Non-fungible and cannot be possessed fraudulently, or be lost when a game shuts down because they are transferable and can be stored in wallets like Trust wallet and MetaMask.
- Transparency and Provable Scarcity:
The existence and history of ownerships is accessible to the public through blockchain and completely unalterable. Also blockchain explorers give full transparency and provable scarcity to each item.
- Investment Opportunity:
Due to the uniqueness of NFT in Gamings, it offers a huge investment opportunity on the game collectibles, whereby, especially scarce items that others want and need can increase very much in value and give the owner a very good Return on Investment (ROI).
- Branding and Creativity:
NFTs can be used for increased brand awareness since they can be also displayed in various NFT marketplaces. Also by adding new creative elements to designs, they can be used to capture new interest and adoption.
We can go on and on but for the sake of this article, we will let your imagination run for what kind other advantages NFTs can have in gaming.
Non-fungible Tokens Market Statistics
According to Nonfungible.com, NFT assets valuation grew from $40.9 million in 2018 to about $338 million in 2020, with only 150,000 participants max, in the market within the period. Predictions also suggest that it could grow up to about $1.5 billion in 2021 due to mainstream adoption of NFTs.
Axie Infinity (AXS), which is one of the NFT Games we mentioned earlier in our examples, rallies 80% following migration to Ronin sidechain. AXS and SLP price surged following the project’s successful migration to the Ronin sidechain on the Ethereum network. https://ct.com/9l7n
Future of NFTs in Gaming
It is important to note that blockchain application and adoption is in its early stages and more innovations are springing up day by day. Blockchain is a technology that gives room for unlimited innovations, and as such, NFT based Games using the benefits of blockchain, is becoming a revolutionary improvement to modern games of our current day.
There is no doubt that NFT-gaming category will become a “Billion Dollar Market” soon in itself.
Recently, Binance, the top cryptocurrency exchange by market capitalization, announced it is launching an NFT marketplace in June, 2021, which will speed up the adoption of NFTs drastically: (https://twitter.com/SeedifyFund/status/1387070741900836877)
Blockchain and NFTs have come to change the way we do things forever! This includes how we play games as well!
As Seedify.fund we are here to support this trend by funding NFT based games and supporting game designers/developers through our innovation hub.
Also if you are interested in being a builder in the NFT based Games category, definitely check out our upcoming Ideathon on NFT-Gaming which will have some grand prizes in SFUNDs and funding opportunities: