6 Reasons Why NFTs Matter for Gamers
|— Gaming assets are a major part of the gaming experience and your digital identity.|
— But they have some major limitations. Assets tied to a game only exist inside that gaming ecosystem – so you don’t really own them, the game does. They can’t be re-sold, monetized or displayed as part of a collection outside the game.
— NFT gaming assets are tied to your address on the blockchain, not the game – they are owned by you, independently.
— This gives you the control to sell, monetize, display and curate your gaming assets independently, and brings your digital experience closer to real life.
Love them or hate them, NFTs are changing the gaming eco-system. Here, we explain how that benefits gamers themselves.
The evolution of technology has allowed the gaming industry to go beyond simple entertainment and become an arena for personal expression.
The $198 billion industry (yes, gaming is the undisputed GIANT of entertainment) has become a way for regular people to enter a new world, and even transcend their human identity. Part of that is curating a unique digital identity via your gaming assets.
Gaming Assets: A Raw Deal For Gamers
Traditional assets such as skins, art and characters are big business: gamers sink hundreds of millions of dollars into these items each year. But there’s a big limitation: those assets have, until now, been tied to the game itself. When you switch off the game, your digital possessions disappear, along with the identity you used them to build.
In short, no matter how much you paid for your in-game assets, you didn’t actually own them. This meant that, unlike real-life items, you couldn’t display your collection outwith the game, monetize or re-sell your items, or even use them where you wanted. The real owner was the game itself, and once you stop playing it, or upgrade to a new platform, all the money you spent is gone.
It’s kind of like buying a jacket but you can only wear it in the store where you bought it. It’s not true ownership.
NFTs: Making Gaming More Equitable
NFTs offered something incredibly important to the world, by enabling individuals to own any item digitally, without using a third-party platform. And one of the areas where this has been most impactful is the gaming industry.
In this article, we’ll explain why NFTs are making the gaming industry a fairer – more realistic – place for gamers.
Quick recap: What exactly is an NFT?
An NFT (non-fungible token) is a digital asset that a person owns via the blockchain. No matter what kind of NFT you own, it is only ever tied to the blockchain – NOT the game itself.
As a blockchain-based asset, NFTs can be accessed and controlled by whoever controls their private key – this is what allows you to “own” the asset, and have complete freedom to use it as you see fit, like a real object.
This is a huge contrast with traditional gaming assets, which gave gamers very limited usage and control over their items.
Look at it this way:
- Traditional assets – Live in the game and are controlled by the game.
- NFT assets – Live on the blockchain and are controlled by you.
“But I’ve got digital assets on the game. I already own my gaming assets. Why do I need to bother with an NFT?”
We hear you. But even though gaming assets and NFTs are both digital assets that you accumulate, they’ve got some fairly important distinctions that set them apart from one another.
- Gaming assets expire, NFTs last forever
What would you prefer to buy: a temporary item, or something designed to last?
Your in-game asset can change or expire completely when the game itself is updates – that’s money and time you’ll never see again.
This is possible because your ownership of the assets is defined by the company creating the game, even if you’ve paid good money to “own” them.
On the other hand,, there is no expiration date for NFTs. They’re safe from expiring or being lost through an update or even a bug, because they live independently on the blockchain. This makes them both indestructible and completely secure, provided you manage the private key properly.
In short, the ability to own an asset without relying on a big corporation to maintain that ownership is a far fairer and more reliable form of ownership for gamers.
- NFTs are interoperable
Interoperability is the ability of a system (like a blockchain) to interact with other systems. It means systems can share data – and assets – with each other.
Unlike traditional gaming assets, which are designed to “fit” and be used exclusively with their game of origin, NFTs offer interoperability across different games on the same underlying blockchain. So like a real-world item, you’re free to use those assets in a multitude of different environments.
This gives vastly more control to holders of those assets and brings the experience of “digital ownership” a giant step closer to the IRL experience.
- NFTs can be resold
When you buy a gaming asset, you’ll unlock access to it within the game – but you won’t be given any transferable ownership credentials, which means you can’t sell it when you’re done.
The process is similar to paying to stream a movie: once you’ve watched it, you can’t resell it. This means there is no secondary market for traditional gaming assets and no way for owners to recuperate their money, even if there are willing buyers for the asset. Sounds like a set-up, right?
However, because NFTs are controlled via the blockchain, they can be resold for real-world value. YOU own the digital asset through the private key, and the infrastructure of the blockchain enables that token to be transferred to another address, in a monetized transaction.
This has created a HUGE and very liquid secondary market, where digital assets are bought and sold according to supply and demand. And this makes complete sense – digital assets NEVER degrade, so of course you should be able to sell them when you’ve used them.
- Curate your identity outside the game
Unlike traditional gaming assets, an NFT can be displayed outside of the game. This might be part of your own profile on a marketplace – a perfect place for you to build a reputation as a connoisseur or elite collector – or even in the metaverse.
In this sense, NFTs allow gaming assets to go beyond entertainment and function, and become part of a much more human effort to create a unique digital brand for yourself, and find your online tribe. Very much like fashion.
- NFTs: potential collector’s items
No matter how rare or expensive your traditional gaming asset, it can never be seen as an autonomous item – it will always be an extension of the game itself. This means that, even if the asset becomes a cult classic or gains relevance, it won’t be worth anything more to you.
On the other hand, NFT-based gaming items that become a hit – be it via pop-culture references, popularity or real-world events – can actually gain real value over time. This means they’re not only appealing for digital bragging rights, but also as collectibles with the potential to store value.
- A huge opportunity for creators
And what about the invisible creators of in-game assets?
For gaming asset designers, blockchain ownership, and the marketplace this creates, offer HUGE potential. It means the ability to design, tokenize, use and even sell their own assets.
The Sandbox is a great example. It started out as a regular game where gamers could create their own pixelated characters. But its transition to blockchain means that now, those same creators can monetize their work, building a market, a profile and a unique aesthetic for the digital space.
It’s an entire economy based on creatives getting rewarded for the creation of characters and assets. Shouldn’t it always have been this way?
NFTs: Buying Means Owning. Finally.
The difference between regular assets and gaming NFTs might not be immediately apparent, but a quick looking at the structural differences between the two, though shows just how big a difference blockchain-based assets make to the regular people funding the industry.
It’s all a question of returns: traditional assets go so far, but NFTs offer better returns to buyers – and a host of new opportunities beyond the game.
And all of this brings the digital world a little closer to the visceral feeling of real life. Isn’t that the whole point?