Dear game developers: Blockchain is not pure evil

Blockchain-based play-to-earn (P2E) games stole the show in 2021, exploding from a fringe hobby to a major part of the decentralized space. They even helped people in developing economies. place food on the table, as the economic models of these games don't prevent things like farming in-game currency and items for resale to other players, which many non-blockchain MMOs frown upon, to say the least. less. .

The major games industry was taking notes as the P2E rocket headed for the moon, and its flight has left the industry bitterly fragmented. On the one hand, top executives at major gaming companies like Ubisoft and Square Enix set their sights on the new market, saw new business models, new revenue streams, new monetization opportunities, and told investors that they are within what the cool kids who are doing can always get some bonus points.

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On the other hand, however, players they themselves were less impressed, whipping against blockchain initiatives even from beloved developers. Developers aren't rushing to adopt new technology, it seems: Some 70% of game developers have no appetite for blockchain or crypto, according to a recent major survey. He showed. This also means that 30% are interested to varying degrees, but the general sentiment is negative.

Interestingly, the survey included some of the concerns that developers had about developing games on the blockchain. For the most part, they amounted to all the regular criticism the crypto community has long grown accustomed to: environmental impact, scams, and monetization concerns. Well, let's clear things up once again, this time focusing especially on the world of video games.

No, blockchain doesn't have to set the Earth on fire

The environmental impact of Blockchain is the easiest fruit to reach for a critic, but, at this point, this probably has more to do with the perception of the industry than its actual situation. Yes, it is true that Ethereum, the second largest blockchain by market cap, has a high carbon footprint due to its use of the proof-of-work consensus mechanism, but nothing compels you to develop Ethereum in the first place.

Related: How blockchain technology is transforming climate action

It's no secret that sustainability is one of the main fronts in DeFi's battle for the Ethereum throne. Many other blockchains, from Cardano and Avalanche to WAX and BNB Chain, flaunt their low power consumption to attract greener development teams. Blockchain games are no different, and the vast majority of game developers build their projects on ecological chains.

Of course, the main reason to build on Ethereum is the fact that you are entering a developed ecosystem worth almost $310 billion, which is more promising for your bottom line than moving to one with a lower market cap. . With that being said, cool projects attract more people and transactions to any blockchain network, increasing the token price and market capitalization. Also, as dozens of chains are supported by the Ethereum Virtual Machine, which is the runtime environment for smart contracts, developers will find it easy to migrate their applications back to Ethereum once the network fully goes into testing. of participation.

Additionally, developers can go one step further and embed sustainability into their economics through design. They can encode royalty payments to carbon offset providers in their NFTs and tokens, committing to green in the strongest possible way. Energy and finances are already shopping difficult for carbon credits, after all, so it might make sense to adopt a similar strategy as part of a broader quest for ecological decentralization. Sure, this would hurt the studio's profits, but the sustainability is worth it.

No, blockchain is not just about scams

Crypto has a scam problem, that is undoubtedly true. Over the past year, scammers, scammers, and hackers have been able to shove off with $14 billion worth of cryptocurrencies. Crypto scams come in all shapes and sizes, including rug-pulling, social engineering, and pump-and-dumps. Everyone who enters the space should be aware of the possible risks, that's for sure.

Related: Beware of sophisticated scams and rug thefts as thugs target crypto users

However, with that said, the mainstream gaming industry also has a scam problem, and actually spiked in 2021, as discovered by Lloyds Bank. COVID-19 has brought more people and money into gaming, and scammers are going where the money is flowing, using all the tried and tested techniques, from identity fraud to malicious third-party sites that claim offer free coins in the game. At the same time, the survey revealed that only 8% of gamers had seen tips on how to spot scammers.

In both industries, there are also instances of questionable developer behavior. From crowdfunded projects that go on for years without updates to early releases sold on Steam without seeing further development, the main stage is not without its scammers. On the crypto side of things, there are, similarly, developers disappearing with money raised through token sales and other scams.

In general, fraud can happen in any space that incorporates something of value, whether it's a magic sword to help your in-game character deal with those pesky dragons, or, say, real estate. For both crypto and mainstream gaming, education must play a major role in eradicating scams. Developers working on blockchain projects must ensure that they pass on the ABCs of preventing fraud to players at every possible opportunity.

At the same time, the crypto space offers additional guarantees against scams. By integrating with decentralized services such as exchanges or yield farms, developers can inspect their code on-chain as it is available in the open. They can also use the maturity and market capitalization of specific protocols as a measure of their safety, as both are indicative of stronger investor confidence and stronger protections.

No, blockchain is not bad for monetization

The concern about possible monetization problems seems somewhat misplaced at first glance. Blockchain was designed from the start as a protocol for transferring value, which, if anything, is quite conducive to monetization efforts. A P2E game, naturally, must include a strong economic component that allows players and developers to make a profit.

At the same time, however, there is a problem here. Any blockchain game becomes part of the larger ecosystem. This ecosystem is inherently turbulent, volatile, and speculative, and these are risks that players and developers alike must be prepared to face even to enter the business. Here's a quick example: To play an NFT game, you usually have to bear the initial cost of buying your NFTs. In order to do that, you first need to buy the native chain token that the game sits on, which means exposure to its fluctuations will also be there if you want to cash out by selling your NFTs later on. Similarly, any fungible token in the game will inevitably rise and fall in value with the broader crypto market. Or will they?

The answer, once again, depends on the decisions made by the developers. The studio may choose to build the game's economy around a stable coin, whose value does not fluctuate over time, despite the rollercoaster the crypto market is on. The reason teams rarely do that is that they are looking for a rapidly exploding token economy, which is only possible with a more dynamic currency. It also creates the risk of additional instability on top of general crypto market movements, as an economy built this way can start to collapse as soon as the token changes or player base growth slows.

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However, developers can avoid this problem by being more creative with their monetization. They can use the programmable nature of blockchain tokens to algorithmically control their price dynamics by burning and minting them based on demand and broader market fluctuations. At the same time, they can add indirect monetization through second-market fees on NFT sales, creating a never-ending revenue cycle and aligning their interests with those of users. If developers release NFT content that players want, they will be able to get a cut of all subsequent resales, thereby offsetting what they could have done by increasing the price of their token.

Like any other technology, the blockchain is not inherently good or bad. It is a protocol with its own design flaws that smart developers can mitigate by making smart design decisions. While not all games need to embrace decentralized technology, there is nothing wrong with experimenting with the value that blockchain brings to game design, and doing so in a safe and sustainable way is first and foremost a matter of choice. .

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The views, thoughts, and opinions expressed here are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.