Innovation is an upward spiral.

Gaming and blockchain are two fields at the epicenter of a new wave of competitive technological innovation.

The race to pioneer new technologies, or to apply existing technologies in ingenious new ways, is fierce. Companies constantly strive to stand out from the crowd, and the quickest way to differentiate oneself is to deliver the best user experience.

In the end, the user always wins.

The union of gaming and blockchain is inevitable, and the impact of this evolution is set to be just as significant as the emergence of online gaming a decade ago.

Thankfully, there are organizations in the blockchain space offering solutions to help game developers disrupt themselves.

By providing open-source development, economic frameworks, and blockchain integration experience, these organizations hope to provide the right tools to help game developers break new ground.

The past has proven that companies who disrupt themselves build reputations, resources, and R&D that drive growth for years.

After all, who better to disrupt you than you?

No one.

What can blockchain do for gaming?

1. Continuous & Parallel Gaming Universes

The distributed ledger makes it possible for gamers to use their characters and items in multiple games with interlinked environments.

This data could even be used by in-game algorithms to work out a player’s gameplay preferences and provide a more tailored experience.

The implications could be profound; consider, for example, the potential for ongoing character development through multiple games. Developers who release game series could connect those worlds using the data stored in digital assets such as characters, skins or virtual items.

Game development studios could even work hand in hand to create parallel gaming universes—a tactic that could result in increased loyalty across all interlinked titles.

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2. Increasing the Value of Gaming Items

There are three ways the blockchain can increase the value of virtual items:

  1. Functional Value: Providing new ways to use virtual items in and out of games will raise the functional value of those items.
  2. Economic Value: Setting up platforms that allow players to cash in their items for dollars will cement their economic value.
  3. Social Value: Creating networks that facilitate trading, sharing, and gifting of virtual items will increase their social value.

For these reasons, game items distributed through the blockchain shouldn’t even be called "virtual items," but rather "digital assets."

3. Safe Storage

Using encrypted blockchain ledgers to store digital assets will guarantee safe storage of game items—permanently.

Distributed cryptography is unhackable because you’d have to hack the right nodes, at the right time, while getting through impenetrable encryption.

Just hacking one hub is impossible, let alone finding the rest and hacking them all simultaneously.

Secured by the blockchain, virtual items will be safe in their users' pockets, wherever they go, for as long as they wish.

4. Proof of Asset Scarcity

The public blockchain ledger will allow game developers to create rare virtual items—and prove their scarcity.

Developers could easily create web pages that pull data from the blockchain for users to track availability of their most coveted digital assets. No one can fool the blockchain: if there’s a specific amount of something on it, that’s all you’ll see.

This provides proof of rarity to anyone who wishes to create rare digital collector’s items.

This is the primary reason why CryptoKitties has been so successful.

CryptoKitties is a simple game where users obtain and trade cute cats that are stored on the blockchain. In its first week, CryptoKitties processed millions of dollars in transactions, with their top selling Kitty "Genesis" going for US $115,000.

Proof of limited supply is what created the incredible demand for these virtual items, and this rarity is confirmed by the immutable blockchain.

CryptoKitties was met with such unexpected success that the sheer volume of transactions overloaded the Ethereum network, causing day-long delays in transactions that might otherwise have taken minutes.

Breaking a powerful distributed network that holds billions of dollars in value by being too successful is a measure of success unto itself.

5. Regulated Gaming Economies

Many game developers and governments have one major thing in common: They know that banning trade does nothing but create unregulated black markets.

And unregulated black markets are bad for everyone.

Game developers lose the ability to control the parameters of trade, missing out on potential revenue and putting their users at risk of being scammed.

Players must then resort to breaking the rules and, in doing so, risk being banned just to get the items they so desperately desire.

The blockchain can be programmed to give developers and server owners the ability to collect ongoing royalties for items being traded throughout their gaming worlds. Developers can also choose to allow items to be traded with no restrictions or can even stop them from being traded altogether.

The blockchain is an economic regulator’s dream because there’s no policing necessary and no way to circumvent the system.

The only way to work around the blockchain is to sell your whole asset wallet, trading all that you have, or nothing at all.

6. Players Could Make Items Even Rarer by Altering Them

In some cases, items could be customized by players, allowing them to re-create and trade or sell upgraded assets with unique properties.

For example, if a player has a high level skill which enables them to cast a unique enchantment on a rare item, doing so would allow them to create something very limited in supply, which they could hold a monopoly on—and sell at a premium price.

This gives the user new ways to use their skillset, while providing other users an interesting opportunity to do business in-game with a merchant of rare items.

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7. Saving Millions on Payment Processing

Decentralized payment gateways will allow users to make payments with a fraction of the fees that are currently paid to credit card companies.

Developers will also save a king’s ransom on payment gateways and merchant subscription fees.

The blockchain fees find their way to the miners, who are rewarded for running their data processing hubs—but there are so many of them, and they are so far removed from the end-user that they have no way to manipulate the market.

8. Micro-Transactions Could Make Gaming Fairer

The ability to take micro-payments quickly, easily, and affordably will give developers new ways to monetize their games.

Cheaper power-ups will allow more users to justify buying items, especially knowing they are gaining something with real-world value.

Subscription services can be commenced, cancelled, and calculated on a second-by-second basis, allowing users to set a limit to their spend. They could log in and log out freely, knowing they are only paying for the exact duration they've used.

Automatic in-game transactions can be set so players can allow games to automatically deliver assets at a cost without having to tediously approve or reject requests, creating a more fluid gaming experience.

This could completely change game development strategy, as monetization goals would no longer be based on serving the few, instead of the many.

For example, in the $41 billion dollar mobile gaming industry, half of the revenue is generated from 0.19% of the users. This heavily influences many developers to change gameplay to cater to the time poor and asset rich.

Seems unfair, doesn’t it?

With blockchain, this strategy will likely prove counterproductive because developers will be neglecting the far greater market that is now open to investing in items.

Even a slight shift in this status quo will boost the value of the industry by billions.

9. Open-Source Development Creates a Relentless Upcycle in Gaming Tech

The internet’s flourishing open-source communities are a futurist's dream.

Open source simultaneously encourages cooperation, competition, and results in constant innovation fueled by a network of creative minds.

Just like Linux changed the internet, it will be an open-source technology that changes the gaming community.

Virtual and augmented reality are better ways of viewing and experiencing, but they aren’t a DNA-level disruption on how networks are galvanized. In fact, blockchain technology will drastically expand the reach of VR and AR worlds.

Where intellectual property allows you to own a technology and restrict other people from advancing it, open-source technology allows you to innovate on other people’s innovations of your innovation—an upward spiral of continual improvement.

The decentralized nature of blockchain technology gives developers incentive and motivation to work together to create an ever-expanding framework.

10. Drastically Reducing Fraud and Recapturing Lost Revenue

One out of every 7.5 virtual items is lost to fraud.

Add in the cost of chargebacks and failed transactions, and we’re talking billions of dollars in lost revenue every year.

Good blockchain tech is unhackable.

The top platforms have stood the test of time for years, while holding hundreds of billions safely online.

11. Democratization Will Make the Gaming World a Better Place

Voting features are very popular within gaming servers and online communities.

Current voting systems mainly allow people to rank games, servers, teams, and other items, however this could be extended to democratize governance over game servers.

This technology could be implemented as a decentralized smart contract with predetermined rules, actions, and protections.

The public nature of the blockchain makes it very hard to manipulate votes and is a perfect shield against corruption.

The potential for democratized voting within games could create a whole new level of gameplay which has not been considered because of the complexities of creating a secure in-game voting system.

Dare to dream about virtual, absolutely democratic, magical republics.

The blockchain is all the framework needed to create the most secure and efficient voting system in the world—and gaming is sure to be the first world you’ll see it in.

12. Digital Assets in an Augmented World

Imagine walking down the street wearing your Google Glasses or Apple Iris Lenses (not a thing, yet) and seeing someone walk past wearing a magical shield they won in World of Warcraft, or wearing the entire skin of a Dothraki warlord.

The vision is so well implemented that it catches you off-guard, so you minimize the app and see that it’s just a 12 year old girl. She smiles at you and throws something to you.

You quickly turn on your AR app and see a Dragon Egg coming your way. You catch it and receive a trade request.

She wants that Valyrian Sword you’re wearing on your hilt.

You reject the request and, despondent, she transmits an audio stream that your AR translates to an old Dothraki curse questioning the morality of lineage.

On your way to work you find three gold pieces and a crystal. You walk past a Black Rainbow but don’t have enough time to follow it and fight the devilish beast that might be lurking at the end.

You turn off the app and walk through the sliding doors to start your day.

The processing power needed for this kind of system is mind-boggling. No server in the world could hold all this data and protect it securely.

These virtual possessions mean the world to you, and there’s billions in valuable assets floating through the ether. It needs to be fortified.

Plus, you’re not going to spend your life fighting beasts for a gold star and a pat on the back—you want tangible rewards for your efforts. There has to be something of value in it for you.

This is why it’s just a matter of time before gaming and blockchain become synonymous.

The time may as well be now.

Innovation is an Upward Spiral

If you’re a gamer, then I hope you are as excited for the not-so-distant future as I am. We’re going to see some incredible innovations coming out in the near future that will seriously improve the way we game.

If you’re a game developer, I implore you to take a break and research how the blockchain can help you improve your next project. Seize the opportunity now to be an early adopter of a groundbreaking technology.

If you're a crypto speculator, I ask you to look beyond the media hype. Do your research. Investigate the goals and objectives of different companies in the space and choose to support projects that are realistic and scalable.

I feel like right now, we’re a part of something very special.

When big things happen, there are always a bunch of small things that happen first, that no one really notices.

I’m glad you’re here to notice.

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