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The recent rise of NFTs has led many to think about blockchain, the technology that supports them, as a solution to problem solving – sometimes rightly so. However, Blockchain’s ability to decentralize virtually any organization and establish the uniqueness and ownership of digital content makes it possible for individuals to interact reliably without the involvement of third parties. This redefines and redistributes value in the all-digital world, puts it back into the hands of its respective creators and owners, and forces all industries to rethink how they envision the future.
This new parable reveals unprecedented possibilities for artists, creators and consumers. The rise of cryptocurrencies and NFTs is a direct, albeit still volatile, consequence of the disruption to digital economies, particularly in the arts and financial sectors, respectively. But the atmosphere of distrust and rejection determined by the blockchain’s early applications should not obscure the secretive tendencies behind the craze. Online, individuals and communities have evolved as co-creators and contributors to the digital world and experiences, now expecting their content, data or time to generate value that they can also take advantage of.
The gaming industry is no exception. Supported by the ongoing expansion of the gaming ecosystem in mobile, streaming and sports, as well as the rise of online multiplayer and user-generated content, players have long played an active role in co-creating gaming experiences. This has led to a major shift in the growth and revenue model of the industry. For example, the development of free-to-play games and game-a-service provides players with new, affordable content on a regular basis while giving their developers the revenue they need to create more content and support those games. However, these models do not recognize or reward the value generated by content creators and communities at the center of those game experiences.
We see blockchain as a tool to make this possible and, as such, not as a solution to the problem, but as an evolution of real life possibilities in the digital space. While not a one-size-fits-all approach, it has the potential to bring more balance to the equation by overcoming existing limitations that restrict players’ ability to create value from the time they spend, the items they buy, and contributions. They make their games.
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However, our view is that a more equitable, more player-centric approach can only be achieved if we, as an industry, take a prudent approach to blockchain integration in sports. It cannot be ignored that confidence in this technology has been severely hampered. Debue saw the emergence of projects based on the environmentally unsustainable form of this technology, marketing stunts, scams and other speculative mechanics. We stand against it and believe that this technology has three crucial prerequisites to fulfill its promise.
First and foremost, established industry actors need to act as gatekeepers and create conditions for trust by implementing this technology in a safe, familiar environment and in a way that makes sense for the media and ultimately players. This will be key to helping players understand the benefits of this new model that allows them to create value in the digital world.
Second, innovation should never come at the expense of environmental considerations. The energy consumption of “proof-of-work” is one of the major limitations we identified at the beginning of our five-year blockchain research. We fully support the call to action of the International Game Developers Association to stop the use of NFTs if traditional solutions can provide similar benefits and only use the “proof-of-stack” blockchain. While blockchains like Bitcoin and Ethereum can consume as much energy as countries the size of Argentina in a single year, this energy efficient version of technology achieves the same results when consuming 20-person villages in the same period. We are committed to this, and we call on our entrepreneurs to pursue this responsible and sustainable implementation and engage in dialogue around “clean” NFTs.
After all, turning to decentralized philosophy means giving players more control over their games. Downplaying this aspect will drastically reduce the interest in this technology, making it just another trick. By introducing exclusivity and ownership into the digital environment, blockchain positively shifts the balance of power toward players, giving them more control over their in-game self, regardless of their character, the home they build, or their entire inventory. Every element of their story, in essence, becomes their own. As such, they should be able to treat them as they would any other thing in real life, including reaping the benefits and value born out of the time and skills needed to sell and build or acquire them.
Beneficial player investment
We see this “play-to-earn” – and ultimately “create to earn” model – as a way to establish players as partners in their experiences. This is in line with our core belief that sports should bring meaningful returns on players’ investment of their time and effort, whether through pleasure, knowledge, creativity, socialization or financial value.
Only when our industry puts players at the center of this evolution will blockchain become a game changer, and then the possibilities for them are endless. Its built-in interoperability and decentralized nature pave the way for a basic, more rewarding framework for both players and developers to move beyond what is possible today. Literally, this means that items (and their tokens) will no longer be tied to a game environment, allowing for a real interconnection between the game world on a technical level. Players will be able to carry their inventory, legacy and achievements from one game to another, which we have tested in our joint experiment with Sorare in the One Shot League. The introduction of decentralization-by-design in games through code has the potential to give communities at all levels absolute autonomy and independence – from their governance, economy, interactions and computing power, as we explored with our early prototype hashcraft.
This is what opens the door to true “metavars” that go far beyond a company’s strategy, and that would not exist without the original digital economy and decentralized, community-driven technology. Yes, blockchain is a game changer, but only if it is used properly and with the players at its core will we collectively exploit the true potential of this innovation.
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