NFT Games

In short, NFT games or blockchain games are online games which offer new technology in the form of NFTs and cryptocurrencies within online games themselves. These types of games are reshaping both the crypto world and the gaming industry. They have already been around for quite awhile and 2020 and 2021 are the years which are marking their inevitable future success. Some of the big names in online gaming such as EPIC, EA and Steam have already recognized NFT games and have taken a stance while others remain silent.

Regardless, this article will showcase some of the original games which have made headlines, currently trending games as well as future projects which will most likely gain popularity in 2022. So, what are NFT games and what is their purpose?

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NFT Games

Before we take a closer look at NFT Games, we should examine what NFTs are. We have already highlighted this in our blog page with the article on the ERC721 Non-Fungible Token Standard. As a result, many web3 projects have shifted onto NFT games foreseeing what the future of the industry could be. Some professional gamers are even switching between genres as they are seeing NFT gaming as more profitable, than regular e-gaming tournaments since it is now possible to turn gaming hours into an investment.

At a higher level, NFT games use blockchain technology in order to prove ownership over in-game digital assets which be traded for fungible assets such as different fiat currencies. There are three main benefits of how NFT games apply blockchain technology into practice and they are the following:

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1. Proof of Ownership (as well as history of ownership) – similar to the blockchain transaction verification, NFT assets within games can be tracked which shows who is the owner of an asset until that asset is traded or sold. Regardless of what happens to a game, the user who owns an NFT which is part of the game, will still be the sole owner of it. For example, a game could be depreciated, however the digital assets will still remain.
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2. Provable Scarcity – Assets which are minted as NFTs are defined and have limited quantity. For example, some digital assets are limited to 10 000 such as CryptoPunks NFT art. As such, there will not be any further tokens minted as the maximum is 10,000. Developers cannot simply decide to add additional NFTs due to specific protocols and limitations. Therefore, as basic core economics principals dictate, if there is a limited amount of an asset, then demand for that asset increases its price by a margin which is the case of CryptoPunks where a token is worth more than 300 000 USD.
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3. Non-editable and Decentralized – NFTs cannot be amended or changed. If an NFT is minted, then it will remain in its original state without any possibility to make alterations to it. Lastly, decentralization is another important characteristic of in-game NFTs as the blockchain is not owned by a single person or entity.  This provides a layer of security that existing tokens will remain existing while the blockchain is live.

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NFT Gaming popularity

For example, traditional games such as EA’s FIFA series, Epic’s Fortnite or even Counter Strike: GO, all have one feature in common. They all have purchasable in-game items such as coins, skins, designs ,maps, weapons or any other type of cosmetic item which does not impact the game’s performance. Consequently, all of the aforementioned items cost fungible assets – money, without providing any value to users. In addition, all of the time and effort put into a game is also is lost since any collected or purchased items are not owned by the user. For example, if any of these games are cancelled or restricted, then all of their in-game digital assets will also be depreciated and this has been a massive problem in the gaming industry. NFT games seem to be a sustainable and scalable solution which can solve this issue, so gamers can prove ownership of their assets indefinitely even outside of a game’s frameworks.

NFT games also attract attention as it is possible to sell the digital collectibles in different NFT Marketplaces for fiat currency. Please check our article on NFTs where you can find a list of popular NFT exchanges. This characteristic is important as it allows players who decide to stop playing a game to sell all of their assets within the game or transfer them to a different platform. For instance, this is not currently not possible and most players have to forfeit their assets.

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Disadvantages of NFT Games

The most dominant disadvantage of blockchain games is similar to NFTs in general – hype and uncertainty. Users who have bought NFT-minted digital assets believe that what they have is an investment. However, 2020-2021's hype for buying such assets has companies and experts worried that this could just be an economic bubble which will collapse eventually. Even though there are more than few non-fungible tokens that have proven their worth and growth potential, but there is still scope for over-speculation and herding in NFT investments.

Another disadvantage includes the environmental Issues of blockchain technology. As the blockchain technology is still in development, it has a large impact on the environment due to large energy consumption. As it is known, most countries still rely on fossil fuels in order to run powerplants to generate electricity while mining crypto increases this process which in turn is not environmental-friendly.

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Historical overview of blockchain games

From a historical perspective, CryptoKitties is the first game which was built on the Ethereum network. As we dived into on our previous article about NFTs – players can buy, trade, and breed cats to create desirable traits which are really indivisible and unique ERC-721 tokens. Additionally, players can sell CryptoKitties on major NFT markets like opensea.io.

The game was originally developed by Dapper Labs in November 2017 and was published on the Ethereum network. Users have shown massive interest in collecting and trading digital cats. Interest was so high that the game’s popularity caused congestion and headlines on the Ethereum network. Nowadays, a CryptoKitty can be bought from an NFT Marketplace or it can be bred by merging two cats together. Breeding cats allows players to unlock rare attributes as such this increases their price on the market. Once a collection of cats is created, then players can participate in catfights or solve puzzles with their peers in order to earn different rewards.

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Trending Blockchain Games

When diving into NFT Games, we cannot overlook some of the most popular games which are currently trending and users are gradually growing their networks. Such games include – Axie Infinity, The Sandbox, Splinterlands and Gods Unchained.

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Axie Infinity

Axie Infinity is an NFT game which is inspired by the Pokemon ecosystem and it is developed on the Ethereum blockchain. It consists of millions of “cute” fantasy creatures called Axies. Players can collect, develop, battle, and trade Axies as digital pets. The core philosophy of the game is play-to-earn as it rewards its users for playtime and effort. Rewards are distributed in the form of an SLP (Smooth Love Potion) token that is earned in the gameplay. SLP tokens can be exchanged for other Ethereum tokens on popular decentralized exchanges such as UniSwap or Binance. After that, tokens can be monetized if they are exchanged into fiat currency like the US dollar.

By far Axie Infinity is one of the projects with best design in cryptocurrency. Everything from user experience to tokenomics is carefully developed and implemented.

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At present, the market cap of 42 million US dollars has been registered in sales in June 2021. In addition, the projected sales are of more than 1.2 billion USD this year. Altogether, Axie Infinity currently holds the most expensive NFT collection. One of its best features is that it is available on various operating systems windows, mac, iOS and Android. Axie’s team envisions to create a virtual economy where users can own and operate own businesses or even save, invest and spend their money without having to rely on classic brick-and-mortar banks.

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The Sandbox

The Sandbox is another play-to-earn metaverse game in which users can own land, play games, or build their own game. Some features of the game actually resemble popular games like Minecraft or Roblox. Users can take control of the massive digital world either as a collector, artist, game decider, or simply as a gamer that travels in the metaverse. The sandbox is built on the Ethereum network and has its own cryptocurrency called SAND.

Sandbox’s token SAND, an ERC-20 coin, as the metaverse’s native. The token can be used to buy a wide variety of in-game products when playing Sandbox. All products are available on the marketplace of the platform. Users can earn LAND tokens, Sandbox’s NFT tokens, which are among the highest valuable assets in this game.

This is one of the hyped metaverses in cryptocurrency. The game has developed an in-game editor that can be used to create models and animations for the future version of the blockchain. For any user looking to buy digital land, then this is one of the top games to play.

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Splinterlands

Splinterlands is one of the most popular tradable free-to-play card games. Similar to Sandbox and Axie Infinity it falls into the category of play-to-earn NFT games. The game allows you to earn digital assets as you play and it is quite similar to Gods Unchained. As a result of winning card battles, users can earn various rewards. In order to start playing this NFT game, users need to purchase a starter pack of playable cards. After that, the next step for users is to register a Steam account that will allow them to unveil the cards which were bought on Splinterlands.

In many cases, players are lucky enough to claim some of the rare cards after their first purchase. There is also a possibility that they may get several cards of the same type. If such an event occurs, then they can simply combine all similar cards to earn an upgraded boost in power. Another solution is to sell one of the identical cards for cryptocurrency.

The gameplay itself is not difficult once players are familiarized with the cards. The next step would be to engage into battles with other players. For players who get bored easily, there are rapid battles in the “Fast and Furious” mode as each round of Splinterlands takes just a few minutes with a chance to make actual earnings feasible outside of the digital world.

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Upcoming NFT Games

At present, few NFT games have been released and a lot are still in the development stage. 2022 will see a lot of new releases, whereas 2023-2024 is deemed to be the mass adoption. Consequently, we will focus on one of the latest NFT games – Wolf.game. Axie Infinity may have found its substitute in the form of Wolf Game.

Wolf Game

Wolf game is starting to build popularity quick as it is one of latest play-to-earn games with its non-fungible tokens in the form of sheep and wolves. At the moment, the game’s NFTs are worth more than 2.8million US dollars in trading volume. Popularity is backed up since crypto influencers such as Gary Vee and Beanie.eth have tweeted about the game.

Generally, Wolf Game is a mix of NFTs and DeFi mechanisms which offer passive income to participants. A key characteristic is the game’s attention to risk in the decision-making process. In other words, the higher the risk, the bigger the reward.

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The game’s main characters are sheep and wolves, which are mintable ERC-721 NFTs on the Ethereum blockchain. To mint such NFTs, users are required to have WOOL tokens. The price for the NFTs like sheep or wolves increases, depending on the minting stage. As the minting process is in progress, user do not know if they will earn a wolf or a sheep. The chance of earning a wolf has a 10% rate, with predators playing an important role in the game.

Currently, the cheapest sheep on NFT Marketplaces is about 3.99 ETH, which is around 16 656 USD (depending on rates). Wolves are more expensive, with its cheapest NFT on sale for more than 30 000 USD.

WOOL is the native utility and governance ERC-20 token for the game. It is the ecosystem's precious resource. The token is used to plot the future of the game, breeding Sheep or Wolves, and growing resources. As users stake sheep NFTs, they can earn passive income in WOOL. The same applies for wolf NFTs, which earn a passive income in WOOL taxes. Currently, one WOOL token is worth 0.16 USD.

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Summary

NFT online games are most certainly a new concept and user shave been gradually investing into the crypto hype, mainly due to the good returns they guarantee in the real world within a short span of time. Scarcity, proven ownership, and the ability to transfer the assets to another player make it more demanding and pioneering as they are on route to change the gaming industry.

As there is growing interest of billionaire investors and large retailers, there is an immense potential for cryptocurrencies to become more involved in the gaming industry. Large companies will most likely change their views and shift onto blockchain technology within a few years while others will continue to doubt that this is just an economic bubble.

Regardless, there are many games in development in 2021 and a few are already on the market as we have discussed in this article. There are already several games which are planned for release in 2022. Therefore, as this is an emerging market, anyone who is currently in this space has an early adopter advantage. So if you would like to learn more about building an NFT Marketplace or a DeFi exchange, please feel free to contact our team as our team of developers can help you achieve great results and become the pioneer of our future.

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