Inside the Rapid Growth of the Blockchain Gaming Industry

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An introduction to the blockchain gaming market

Blockchain technology is poised to revolutionize most of the world’s industries, and gaming is no exception. With a US-based market capitalization above $60.4 billion in 2020 and a global revenue of approximately $159 billion in 2020, the gaming industry is actively growing.

In fact, a Newzoo report predicts that the market will exceed $200 billion in yearly revenue by 2023.

Despite the sheer size of the market, blockchain-based gaming is still in its infancy. Once disruption occurs, these figures will grow exponentially, as blockchain works its magic to reduce friction, increase trust and create new revenue streams for gamers.

This article will provide readers with a thorough overview of blockchain’s value proposition within the gaming industry. Furthermore, it’ll highlight a series of use case scenarios, brought forth by innovative blockchain-based projects looking to reshape the market as we know it.

How blockchain benefits the gaming industry

Over the last few years, we’ve been direct witnesses to the emergence of in-game economies. Other advancements like virtual worlds, peer-to-peer gaming, live streaming and esports highlight significant room for growth. However, these developments are not free of hurdles and challenges affecting players worldwide.

As a whole, the gaming industry lacks a sufficient degree of trust and accountability. Players are also finding it difficult to generate income through gameplay, in spite of revenue opportunities created through live streaming, sponsorships and in-game economies. Moreover, numerous companies are actively showcasing a predisposition to engage in greed, eroding the industry’s core principles.

Luckily, blockchain is here to save the day. Multiple blockchain-based projects are aiming to resolve the issues highlighted above. To keep things brief, blockchain technology assures decentralization, immutability, transparency, accountability, security, quick transactions and low fees without having to rely on third parties. Blockchain’s gaming use cases are plenty. From accounting for in-game item rarity through NFTs to facilitating P2P integrations or creating revenue streams, the gaming industry is scheduled to be overhauled. In the long run, players will access cost-effective means of payment for in-game purchases, fraudulent activities will be minimized, accountability will be restored and overall industry trust will be attained.

Exploring blockchain gaming use case scenarios

Here are a few case studies highlighting the benefits brought forth through the usage of blockchain technology within the gaming industry.

No-limit, peer-to-peer betting via Augur

The global sports betting market was valued at $85 billion in 2019. However, betting doesn’t have to be limited to sports. In fact, bettors should be able to wager on the outcome of any event, without unnecessary restrictions. Today’s betting market is flawed. Odds are never fair and payouts are often delayed or unsatisfactory, whereas high volume bettors are oftentimes penalized. These issues are the direct result of centralized betting platforms whose sole focus is profit generation.

Augur aims to revamp the betting industry by creating a global, no-limit platform where users can easily bet on world events, sports, economics and more. Augur is blockchain-based and peer-to-peer, so it is open to use and profits from betting volumes. It has no interest in penalizing users or lowering their limits. Cryptocurrencies are accepted and all payouts are based on smart contract integrations.

Providing gamers with new revenue streams via ExeedMe

The esports industry has seen considerable popularity, but player participation entails high entry barriers. To join a team, an enthusiast must exhibit skill but also compatibility with other team members. But this is never enough. Individual players and teams must also seek sponsors and rely on networking to participate in competitions. Streamers can access sponsorships and ad revenue, but beginners often have a hard time making ends meet.

ExeedMe holds a simple purpose generate new revenue streams for gamers through the means of NFTs and DeFi projects. As a blockchain-based tournament platform, players can seamlessly monetize their skills with no regard to their actual skill level. The platform works by leveraging Polkadot’s infrastructure to set stakes and fund matches using liquid cryptos. Small-scale tournaments can be carried out between friends, fellow players or highly skilled individuals. Whoever wins obtains the prize pool.

However, players are rewarded XED tokens whenever a bettor trusts in their skills. By progressing through tournaments, gamers obtain NFT rewards with an inherent value that’s backed by rarity and exclusivity. With matchmaking, anti-cheating protocols and an agnostic approach, ExeedMe will surely encourage considerable player value growth.

Integrating off-chain oracles for betting with Chainlink

Chainlink is a decentralized oracle network designed to connect smart contracts to the outside world. Through Chainlink’s system, complex smart contracts can access trustworthy and immutable inputs and outputs, thereby facilitating a wide array of use case scenarios, one of which is decentralized betting. Chainlink easily connects to any API, thanks to its flexible framework, and its oracles are reliable and transparent. As such, it’s never been easier to connect blockchain technology to off-chain data.

With a quick integration, a casino can facilitate betting on real world events without having to rely on centralized data sets. But this technology isn’t exclusive to the betting industry. Chainlink can also be deployed within actual games to influence in-game events based on real-world data. The possibilities are endless and incredibly exciting.

Creating in-game value through non-fungible tokens

Projects like AnRKeyX, CryptoKitties, Axie Infinity or Decentraland were designed to make use of blockchain-based NFTs to provide in-game items with actual value, depending on their scarcity, uniqueness and use cases. Consider this – your favorite game hosts a one-time event which compensates a few winners with unique and powerful items. These items can theoretically be sold within the in-game economy, due to their use cases. How do you gauge the actual scarcity and value of the items? What if the game developers lied and actually created numerous copies of the items? With NFT deployment, transparency is assured. Players can leverage the blockchain network to attest the authenticity and rarity of a specific item prior to purchasing or selling it. With this in mind, NFTs are bound to reinvest in-game economies, leading to substantial value growth.

Wrapping it up

As blockchain’s mass adoption continues, gamers worldwide will soon access a revamped ecosystem that places user satisfaction at the forefront. Over the long run, it is expected that blockchain integrations will boost the industry’s size while creating next-gen use cases.

Edda Viktor

Blockchain enthusiast learning to write and deploy my own DApp. Previously worked for the oil and gas industry as an IT administrator.

Featured Image: Spells of Genesis via Twitter

Source: https://dailyhodl.com/2020/12/25/inside-the-rapid-growth-of-the-blockchain-gaming-industry/

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