Bitcoin has introduced us to a revolutionary technology called the blockchain. This digital ledger of transactions has been upgraded over the years, to provide more privacy, allow faster transfers, or provide a more democratic way of confirming transactions.
Thanks to the advantages of blockchain technology, Bitcoin has become a great store of value that can be also traded on different exchanges like Bitlevex.
However, one of the most significant upgrades to blockchain technology was brought by Etereum, which enabled smart contract functionality. Smart contracts are self-executing apps that complete automatically when certain conditions are met and allow for the creation of proprietary fungible and non-fungible tokens (NFTs).
In this article, we will be exploring NFTs in detail and try to uncover how they can revolutionize the gaming industry.
Blockchain properties and advantages
Blockchains are distributed digital ledgers that can be consulted by anyone, at any time. IT boasts the following properties:
- Because thousands of computers that are simultaneously online own a copy of this ledger, blockchain transactions are inherently secure.
- Blockchains are transparent and allow for transaction data to be easily verified.
- And finally, blockchains use cryptography to provide true ownership to the user. Anyone in possession of the private key is the sole custodian of those blockchain assets.
Blockchain in gaming – What are NFTs?
NFTs are unique digital items that can represent anything of value – real estate, art, gaming items, etc.
Unlike fungible tokens that can be seamlessly exchanged for one another (like BTC for BTC), NFTs cannot. They have a set of properties embedded in their metadata that make them unique from one another.
One thing that is closest to NFTs in the real world are collectibles like pokemon cards. The collectible’s value depends on its rarity, date of issuance, mint condition, etc. Even the same pokemon cards aren’t priced exactly the same because of this.
NFTs allow us to tokenize anything of value and distinguish them from one another using their blockchain data. Consequently, we can create digital items that are valuable and where their ownership can be easily proven on the blockchain.
Best use cases of NFTs in gaming
As such, NFTs provide several use cases in the gaming industry that could revolutionize the sector. Let’s have a look at what they are.
Digital collectibles
The most prevalent use case for NFTs in gaming are digital collectibles. Games such as Cryptokitties or Axie Infinity allow players to collect virtual pets, breed them and resell them on the open NFT market.
In addition to being fun, digital collectibles with NFTs can become a very lucrative venture. Rare pats can sell for considerable amounts of money, such as the most expensive CryptoKitty that was sold for 600ETH ($1.5 million!)
Items and game avatars
Yet another important use-case of NFTs in gaming is the tokenization of in-game items and avatars, like in the game Alien Worlds. As such, gamers can resell powerful characters or items for real money or crypto, making the time spent in a game worth their while.
Virtual real estate
Finally, gamers can own and rent and sell virtual real estate in open-world games such as The Sandbox.
Games such as these provide a framework for creating a metaverse, where gamers can depend on their own crypto-economy that is connected to the financial system in the real world.
Wrapping up
While the adoption of NFTs in gaming seems to be a no-brainer, there are several challenges that need to be overcome. Game publishers supporting NFTs are still far and in between and gaming companies are not yet ready to lose control of in-game items without having a way to profit from them.
However, the advantages that NFTs bring are too big to be ignored and we can expect more game developers to adopt them in the future. This should provide for more fun and lucrative gaming experience for both the gamer and the publisher.
