How NFTs Are Changing The Gaming Industry
‘NFT’ is one of the biggest buzzwords that have hit the market in recent years, but what are NFTs and how do they affect the world of games? Let’s start with the basics…
What are NFTs? NFT stands for Non-Fungible Token. Let’s break it down: Non-Fungible is essentially just a fancy way of saying non-replaceable or something that cannot be identically replaced or replicated. A token is a cryptographic asset…Which just in layman’s terms means a digital asset. So a non-fungible token is a unique digital asset that cannot be replicated. Where do NFTs stand in the world of blockchain? It is a cryptographic asset on a blockchain with its very own unique identification code that distinguishes it from all other digital assets that exist online. It can take some time to get your head wrapped around it, but if you scratch all the fancy big words you can simplify it to mean a digital asset in the digital world with a unique identifier that cannot be replicated.
NFTs are mostly used in the digital art world for people to create their own digital art and be able to sell and monetize their digital assets. NFTs are digital assets on the blockchain and so anyone that owns that digital NFT art piece owns the unique identifier that comes with it. In that sense, no one can replicate the NFT asset or ‘digital art’ that has been created, it is unique to its owner. The NFT asset is a unique item in the digital world due to the blockchain technology that it is associated with. So any NFT that is created on the blockchain is one of a kind and cannot be replicated or copied. It can only be traded due to the exclusive code that it is identified with. These one-of-a-kind pieces led to a surge in demand for digital art with many pieces selling for millions of dollars. Now that we have laid down the basic groundwork let’s dive into how NFTs have impacted the gaming industry.
Digital assets have existed in the gaming world ever since its inception. Digital assets refer to any type of virtual item or character that exists within the game. These assets have been a part of the gaming world for as long as it has existed but with the rise of blockchain technology and NFTs people are beginning to change the way they think about in-game assets and are beginning to realize that there are now new opportunities to invest, engage and monetize with the games they love to play.
Since NFTs are digital assets that are verified on the blockchain and non-replicable, this new technology has created a profound impact on the gaming industry. The most obvious way NFT technology has impacted the gaming market is that NFTs can now allow gamers to actually own the in-game assets that they purchase. This means that the developers that have created the in-game assets can now trade and sell these digital assets to players with an individual unique code for every digital asset created. Players having game item ownership is leading to a new level of engagement and investment in gaming. Not only that, but the developers have also unlocked new ways to monetize one-of-a-kind items directly to players leading to higher revenue for the games.
For the players, NFT technology has allowed for the creation of in-game economies where players can autonomously trade and sell their in-game digital assets creating new modes of income and investment. Some technologies are also giving players the chance to take their assets from one game to the other. For the developers, NFT technology has allowed for more possibilities in monetization and creating sustainable business models for the games that they create. If you look at it historically, we can actually say that NFTs were born in the gaming world, and with the introduction of blockchain technology digital creators now have the chance to invest and monetize their creations. Blockchain has had a profound impact on our economies and the world of games is no exception with the multitude of digital assets that have long existed, simply put, NFTs and blockchain are reshaping the traditional gaming eco-system and have opened new doors for both gamers and developers allowing for limitless possibilities for the industry.