Could Video Games Bring NFTs to the Masses?

A year ago, NFTs were obscure virtual assets known only to tech geeks, but as video game companies enter the growing market, industry players are hoping to be on the verge of doing so. generalize.

Short for “non-fungible tokens,” NFTs are digital items whose certificates of authenticity and ownership are saved on blockchains, the technology behind cryptocurrencies.

From art to fashion, the creative industries were quick to experiment with an innovation that has sparked enthusiasm and skepticism in the tech industry.

Auction houses like Sotheby’s are now selling NFTs alongside oil paintings, while director Quentin Tarantino is embroiled in a legal row over NFTs from his cult film “Pulp Fiction.”

And now that they are introduced to video games, supporters are hoping millions of gamers can familiarize themselves with an idea that remains difficult to comprehend.

“NFTs remain a niche market, but we are a really mainstream industry,” Nicolas Pouard, head of blockchain initiatives at gaming giant Ubisoft, told AFP.

Ubisoft this month launched Quartz, a platform where players can acquire NFTs called “Digits” – items in games that can take the form of weapons or vehicles.

Other gaming heavyweights such as Electronic Arts – the company behind The Sims and FIFA – as well as Take-Two and Atari have also expressed interest in NFTs.

Investors meanwhile poured $ 680 million this year into French start-up Sorare, whose platform allows sports fans to redeem NFT versions of old-fashioned football cards.

– Three billion players –

NFTs are collectible by nature, which makes them easy to integrate into games where the fun comes from collecting items or points.

But it is the sheer weight of the global video game industry – now regarded as more valuable than the film industry – that makes it ripe to present NFTs to a wider audience.

A DFC Intelligence report estimates that more than three billion people play video games, which represents about 40 percent of the world’s population.

Crypto evangelists argue that concepts like blockchains – digital ledgers that publicly record all transactions – are already familiar to millions of people.

Some 221 million people around the world owned cryptocurrencies in June, according to a study by trading site, a figure that has more than doubled since January.

Due to their wide popularity, analysts predict that games could dramatically expand access to blockchain-based assets like NFTs and cryptocurrencies.

Proponents say NFT games like Axie Infinity, which allow players to “play to win” crypto and are popular in developing countries, allow ordinary people to take advantage of the technology.

Such games have generated a “positive social and economic impact for countries in Asia and Latin America,” insisted Franklin Ovalles, a 40-year-old Miami-based NFT collector.

– An upcoming stock market crash? –

A whopping $ 26.9 billion changed hands in NFT sales in 2021, according to blockchain research firm Chainalysis.

Some individual NFTs have sold for huge sums, such as a work by digital artist Beeple for $ 69.3 million.

However, most traders lose money.

Only 28.5% of NFTs that are sold immediately after production make a profit, Chainanalysis said, although in the thriving resale market 65.1% of sales are profitable.

Investors should also take into account the high volatility of the cryptocurrencies used to trade them.

Jonathan Teplitsky of blockchain company Horizen Labs said investors were taking risks in the NFT market as interest rates remain low.

“That being said, the high priced NFT stock market crash is approaching,” he predicted.

But he also sees it as a factor that could further democratize a market that remains the prerogative of the privileged few.

“In addition to providing revenue streams for creators around the world and removing barriers to access, we will also see the NFT industry change shape to drive mass adoption,” he said. .

But Teplitsky believes it will take more than the gaming industry for NFTs to become a household name.

“I think NFTs will be more ‘non-geeky’ when non-gaming companies start using them,” he said, suggesting that brands like McDonald’s could potentially offer digital collectibles.

“Once NFTs become part of everyday life and provide users with benefits in non-geek establishments like a food chain or clothing store, then they will become more common,” he added.

“Let’s be honest,” he said, “most of the players are nerds.”

yk-kjl / rl

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