Since hitting the headlines around the start of 2021, NFTs have evolved from the fad everyone expected them to die out to become the last unstoppable arm of the cipher machine.
NFTs are creeping into everything, with all forms of art and entertainment at risk of becoming another commodity. The latest casualty of what is becoming big business NFT is the video game industry: every week, another big-name game studio, publisher or storefront incorporates NFT into their 2022 business plan.
But what can NFTs offer video game players? Companies promise that these digital assets will enhance the player experience, but the truth is that video game NFTs are no upgrade to our current system at all – and here’s why.
What are NFTs?
Discussions about NFTs are prevalent these days, so most of you probably know what they are. Yet, for those of you unaware of this latest technology trend, NFTs, also known as non-fungible tokens, are unique digital objects or assets.
If we have an MP3 file and you want that same MP3, all we have to do is click copy and paste to create a replica to send to you. This means that the MP3 is fungible, because two copies of the MP3 file are basically the same – you won’t be able to tell the original from the copy. You can have one; everyone can have one.
Now imagine you want something different, more unique, like the Mona Lisa. As any art lover will tell you, we can’t just take a photo or paint our own version and claim the copy is identical to the original; the replica is not the same as the original painting, so the Mona Lisa is classified as non-fungible.
NFTs are digital assets that have been minted on the blockchain – the technology behind cryptocurrencies like Bitcoin and Ethereum. These digital assets become files that you cannot simply copy and paste. Like the Mona Lisa, this makes these digital assets non-fungible.
Naturally, things get a little complicated when you get down to business, but for all intents and purposes, NFTs are designed to be separate digital objects that you can’t duplicate.
How do NFTs fit into video games?
Video games and NFTs collide in two ways.
For the most part, video game NFTs look like Konami Commemorative NFT Collection which launches in time for Castlevania’s 35th anniversary.
Those who purchase these NFTs will receive a digital stamp – much like a certificate – stating that they own the pixel art, music track or clip. There could also be other advantages, as in the case of Konami’s NFTs. Konami will also include your name on its website and provide the owners of each NFT with content that “can only be unlocked and revealed by the owner”.
Overall, deals with this type of NFT are pretty standard, and that’s what we expect from an NFT collection – whether it’s game-related or not.
Now, there’s another type of NFT that we’re starting to see examples of in video games. Ubisoft offers trial versions of this type of NFT in Ghost Recon Breakpoint; Square Enix also seems interested in the idea.
Through his UbisoftQuartz platform, players in certain regions can claim or purchase NFT cosmetics called Digits. The numbers were created using the Tezos blockchain, but work like any other cosmetic item in the game – you can use them to give your character a unique design, but you don’t get any functional benefit.
NFT cosmetics are distinct from standard collectible NFTs, in that each figure will only be available for purchase from Ubisoft for a set period of time – before disappearing permanently. This means that if you want that particular number in the future, the only way to get it is to trade with someone who already has it.
Although Square Enix has not officially unveiled its NFT plans, the company’s president, Yosuke Matsuda, recently published a letter explaining how NFTs will create opportunities for those who “play to contribute.” In other words, Square Enix’s NFTs could be part of a marketplace for user-generated content in games.
If you’re thinking, “Huh, that sounds pretty cool actually,” you’re not wrong. The ability to trade cosmetics or sell your own in-game creations would be a useful addition to many games – which is why many video games already include these types of systems. There is no need for a blockchain to create something that is already in place.
Roblox, Counter-Strike: Global Offensive, Star Wars: The Old Republic, and RuneScape are just a few of the games that contain systems that make it easy for players to trade in-game items.
Of course, not all in-game markets are created equal – some allow you to use real money or in-game currency that can be converted to cash, while others only allow you to use virtual dollars. who remain trapped in the game – but the basic concept of player-to-player commerce exists and works.
User creation isn’t new either, and several games have already found ways to monetize user-generated content so that creators can be compensated for their work.
If a metaverse takes off and our digital spaces become more integrated and sustainable, then NFTs could be put to good use in creating trusted digital-only commerce. But for now, there’s really no need to rely on them since our games are years away from functioning as a true metaverse.
In fact, there are many solid reasons why we should avoid NFTs.
Why We Don’t Need NFTs in Video Games
For one, cryptocurrencies are still quite volatile – some long-standing coins are a little more reliable, but the last two years have shown us that any coin can fall from a high in the Everest to a trench-like trough of the Marianas at a hat drop.
If the cryptocurrency on which the NFT is minted dives, the value of these digital assets could plummet, resulting in many angry gamers and investors who have been sold on the new technology.
Also, while games like Ghost Recon Breakpoint are popular now, what will the player base look like in five or even 10 years? By then, Ubisoft will likely have released a few more entries in the series and the old game will have been ditched by gamers in favor of the new trend. Breakpoint’s servers may even be permanently shut down.
Who wants a cosmetic NFT for a missing game?
On top of that, the environmental impact of cryptocurrency mining – a practice that NFTs depend on – is huge.
Bitcoin agriculture produces approx. 60 million tons of CO2 annually, while Ethereum produces nearly 17 million tons of CO2 annually. A country with this combined carbon footprint would be the 48th worst CO2 polluter in the world; but given that there are over 8,000 currencies, the environmental impact is probably much worse.
The Present and Future of NFTs in Video Games
NFTs currently don’t provide anything of value to video game players, and we’ve long known how harmful crypto blockchains are to the environment. So why are NFTs integrated into video games?
Considering our view that NFTs currently offer nothing new to the gaming world, it’s hard not to feel that NFTs are just another cash grab, incorporated into video games by publishers and studios looking to take advantage of the latest industry buzzwords.
If so, it makes perfect sense: selling NFTs has been a huge source of revenue for creatives throughout 2021 and continues to be hugely popular in parts of the internet.
The problem here is that the studios are over-promising. We’re told these new blockchain-powered systems will create unique and special opportunities in the games we love – but the features currently being implemented aren’t new.
Some people have speculated about the awesome potential of NFTs, like Linkin Park’s mike shinoda, which envisions a future where a cosmetic skin could be used by a player in a range of games from different publishers. Sounds good to me. Unfortunately, the video game industry does not currently cooperate in this way, having no kind of shared space.
Even if something like this could become a reality, such a system would require a lot of effort and input from competing brand design teams, and you know what they say about too many cooks in the kitchen.
Ah! So here’s something people don’t explain: NFTs don’t have to be jpgs. Imagine taking your favorite skin from Valorant and using it on Fortnite. And don’t pay extra, because you own it. Then use it in CoD, Minecraft, even Twitter, IG. So many possibilities, right? https://t.co/cJTA6E0z69January 8, 2022
The situation could theoretically change – never say never – but don’t hold your breath expecting the video game NFTs you’re buying right now to be available in a title other than the one you bought them in.
And thankfully today’s gamers are quick to point out all of these issues and seem uninterested in engaging with NFT content.
Early estimates suggest Ubisoft has managed to sell only 15 NFTs through third-party vendors within a month of its Quartz announcement. Additionally, the developers of Stalker 2 dropped its NFT plans following an online backlash.
While other studios still seem determined to include NFTs in their latest projects, we hope gamers will continue to speak loudly about their rebellion against such plans, forcing change based on player preferences – at least until NFTs are cleaned up and incorporated in a way that provides significant improvement.