The market is seen as revolutionary by the play-to-earn model, so it is necessary to be cautious of entering this new scenario. We will show you how Blockchain Games work.
The games are inserted in our reality; therefore, they managed to guarantee the consolidation of an extensive virtual industry, extremely profitable, where its developers are, at all times, looking for new updates, whose purpose is to stand out in this promising market.
With the advent of computers, the possibility of formulating “games” in programming languages of the time also emerged. Thus, the opening of the games market started in 1962, with Spacewar, an innovative and straightforward spaceship game, produced for two players, whose objective was to destroy the opponent’s spaceship.
From the emergence of the blockchain, we changed how we use specific media, resulting in a disruption of traditional games.
Our life changed in more than one way. With this, the possibility of crypto games, known as “play-to-earn,” was seen.
As much as the possibility to play and still win money is excellent, the reality is that there are still problems to be solved so that they compete in the traditional gaming commerce.
The CryptoKitties was the first game known in the market, with gameplay users might have, exchange, and create your “kittens,” the only game accessories.
The results of this are a generation of people using this new market to commercialize domains of work, with ownership and voluntary exchanges between individuals, as in the case above, to have control over their charter.
What is NFT?
NFT’s are well used in blockchain games, and its acronym means non-fungible token. That is, it is a non-fungible token.
It is a technology that allows you to validate and acquire ownership of digital assets. In other words, it means being a unique asset and a great example of this are works of art.
Because, even with the possibility of reproducing the image, in cups, dish towels, t-shirts, among others, Michelangelo’s painting, The Creation of Adam, has a SINGLE role in the historical process, thus being a non-fungible, different asset. Of any replication as engraving.
On the other hand, there is a fundamental difference between non-fungible tokens and cryptocurrency.
In economics, a fungible asset is “money” (currency), as there is the unity of being easily exchanged and having several identical pairs.
As a result, it is noticed in blockchain games the potential of the domain’s permanence by a piece (non-fungible token), whether in games, art format, or even tickets.
In addition, it creates a rate of speculative investors, as they use purchases in an attempt to sell for a value above what they acquired.
Advantages and Disadvantages of NFT Games
As such, NFT games are pretty popular right now. However, they have advantages and disadvantages that we will describe below:
- Unique and Collectables
Some specific individuals like the power of exclusivity over a particular product.
No wonder there are RPG cards with catastrophic values on the market. An example is Pokemon cards, such as Charizard sold for $311,800.
It is the heart of the matter since the price of RPG cards is not linked to the intrinsic value but to the value that a specific group of people attributes wanting to have the original card, being a unique and collectible asset, however easily replicable.
- are immutable
As trading tokens are non-fungible since they are blockchain-based, they cannot be changed or deleted, bringing a unique value to the games, as it allows authenticity in each asset acquired in fun.
Everything related to NFT games seems to be perfect, but there are downsides to be pointed out.
- Speculation about supply and demand.
As it is a new and growing market, each investment is still a principle of expectation that unique individuals will give a price above what you previously gave, buying in the hope of the asset’s appreciation.
A practical example is the game CryptoKitties, mentioned above. A large number of players, who arrived during the explosive growth stage, generated a large number of kittens in a short period.
On December 4, 2017, the number significantly exceeded the number of cards sold daily, which resulted in few kittens remaining for sale.
This intensified competition among game buyers, thus causing a decrease in successful sales on the day, as sellers were constantly prolonging the deal, expecting more appreciation or an above-average price when there were no buyers available for purchase.
Future of NFT Games
Thus, the current market, as described, is still embryonic compared to traditional games, as it is recent and has a lot to explore. However, a good part of the initial investments require a high cost, and a good part enters the games not for the ordinary, to have fun/compete, but with the expectation of good profits, actually speculating about winning cryptocurrencies or trading the NFT at a price above the initially bought.
The current model is not as fun as mainstream games, with the difference that blockchain games also require specific knowledge, such as: setting up a wallet, storing cryptocurrencies, trading, and selling.
Until such a widespread understanding takes time, so it’s pretty uncertain how it will all play out. The market is seen as revolutionary by the play-to-earn model, so it is necessary to be cautious of entering this new scenario.