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The future of Web 3.0 gaming—Blockchain Futurist Conference

According to a 2024 OnePoll survey of 2,000 adults, 52% of respondents said they were unaware of what blockchain gaming was.

Executives from World3, Helika, and Anomaly Games took the stage at this year's Blockchain Futurist Conference in Toronto, Canada to discuss the current state and future of Web 3 gaming.

Long Do, CEO of Anomaly Games, opened up by explaining his company's focus on abstracting away the highly technical components of the blockchain experience so that users would not even know they were engaging with blockchain systems.

The CEO then turned his attention to the stark contrast between game profitability for traditional game developers and Web 3 game development studios:

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Pixelverse Raises $2 Million, Totals $7.5 Million in Private Funding

Pixelverse Raises  Million, Totals .5 Million in Private FundingPixelverse, a Web3 gaming ecosystem, has secured an additional $2 million in funding, bringing its total private round to $7.5 million. This funding was provided by several Web3 venture capital firms and prominent angel investors. Web3 Gaming Platform Pixelverse Secures $2M in Latest Funding Round Galaxy Interactive, Crit Ventures, and Arc Community contributed to the […]

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Memecoins and AI are pushing Gamefi out of the spotlight

Industry figures disagree on whether GameFi is having a good year as other aspects of Web3 hog the spotlight.

Gaming’s intersection with finance and crypto — also known as Gamefi — has been a bit of a mixed bag in 2024.

Voices from across the industry have spoken to Cointelegraph to deliver their verdicts on the current state of the GameFi industry — and their conclusions are far from unanimous.

In December 2023, Cointelegraph asked industry experts to predict what 2024 would bring for the sector, and now that we’ve passed the halfway mark, we’re revisiting the subject once more.

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Hamster Kombat creators: marketing geniuses or modern satirists?

Hamster Kombat has 200 million players clicking their screens. But the game raises intriguing questions about play-to-earn gaming, growth hacking and universal basic income.

Hamster Kombat isn’t just another game. It’s a digital powerhouse driven by constant clicks, a quest for profit, and promises that exist only online. Since its launch on Telegram in March 2024, Hamster Kombat has skyrocketed in popularity, attracting over 200 million users.

The speed with which it gained players is perhaps most impressive. The Telegram-based game onboarded around 1.8 million players daily in the 77 days after it went live. It’s in-game mechanics have also led to its social media and YouTube channels breaking records.

Hamster Kombat embodies casual gaming—simple, accessible, and requires zero skill. These games are meant to kill time effortlessly. In Hamster Kombat, you can mindlessly click on the Hamster avatar to rack up coins. 

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Iranian officials decry blockchain game ‘Hamster Kombat’ as soft power tool

The deputy chief of the Iranian military claimed the game was a way of distracting Iranians from the country's upcoming presidential elections.

The growing popularity of the play-to-earn blockchain game "Hamster Kombat" has drawn sharp criticism from Iranian government officials and hardliners, who claimed the simple play-to-earn tap game is an instrument of soft power projected by Western nations.

Habibollah Sayyari, the deputy chief of the Iranian military, claimed the game was meant to distract the Iranian population from the country's upcoming elections. Sayyari's comments were echoed by religious authority Ayatollah Nasser Makarem Shirazi, who characterized the entire field of cryptocurrencies as fraud-ridden.

These comments from Iranian officials don't acknowledge the dire financial situation many Iranians find themselves in while the country is beset by Western sanctions and soaring inflation. To put Iran's economic problems into sharper perspective, the current exchange rate is 1 U.S. dollar to 580,000 Iranian rial.

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Crypto clicker games need real token use cases to be sustainable

As Notcoin and Hamster Kombat continue to amass millions of users, experts question the long-term viability of crypto clicker games.

Web3 clicker games are the newest phenomenon to appear in the crypto world, but their purported ability to generate fast returns has called their sustainability into question.

Also known as crypto idle games, these simple yet addictive games have witnessed monumental financial growth over the past month alone, attracting tens of millions of users while generating substantial buzz worldwide.

Notcoin, a play-to-earn (P2E) game integrated into the Telegram messaging app, has been at the forefront of this revolution, boasting an impressive 40+ million players. Moreover, since May 26, the game’s native Notcoin (NOT) token has seen a staggering 240% increase in its value, with its market capitalization soaring past $2.75 billion at its peak.

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How the crypto bull run can impact Web3 gaming beyond play-to-earn

Web3 gaming has remained unfazed by the bear season. But how does the expected bull run impact interest in blockchain-based games?

On-chain data tracker DappRadar recently reported that another $600 million was poured into Web3 gaming projects in Q3 2023, making the total investments surpass $2.3 billion in the year so far. 

Another report from the blockchain gaming community, Game7, indicates a stabilization in Web3 gaming despite the market correction.

The interest in Web3 gaming — a general term used to describe the ecosystem housing blockchain-based video games — is clear and remains unfazed by the so-called “crypto winter.”

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Mainstream approval critical for blockchain games — Gaming execs

Three gaming executives believe mainstream audiences will play a factor in the overall success and future of Web3 games.

Web3 game developers have been battling to gain the attention of mainstream audiences for years, and according to three former gaming executives, that market is essential for the industry’s future. 

Video games have become a favorite pastime for a lot of people all over the world and have even evolved into a sport. Overall, there are more than three billion Web2 gamers worldwide as of 2023, according to Exploding Topics. Most are considered casual gamers who play regularly but rarely invest significant time.

Jennifer Poulson, who has worked in the gaming industry for 18 years, including at Web2 gaming companies Bandai Namco (Tekken, Elden Ring, PacMan) and Riot Games (League of Legends), believes mainstream audiences are “absolutely” important for the future of Web3 games.

Speaking to Cointelegraph, Poulson, who is currently vice president of game partnerships at Immutable Games, said in her mind, “Bringing mainstream players into the Web3 space will be essential in the coming years.”

“However, it isn’t so much that we need to entice mainstream players to take the leap into Web3; rather, we need to be building games that are fun to play and will appeal to all gamers,” she added.

Mainstream gamers aren’t particularly fond of crypto, especially when nonfungible tokens (NFTs) are involved.

Blockchain entertainment firm Coda Labs released its Global Web3 Gamer Study in 2022 and found traditional gamers were not fans of crypto or NFTs. Respondents rated their feelings about them at 4.5 and 4.3 out of 10, respectively.

Poulson believes working with mainstream publishers and studios will be crucial for the future of Web3 games.

Because “it’s less about attracting mainstream audiences, and more about working with publishers and studios to understand how and why to integrate Web3 elements into their games.”

Related: Grinding out a living: Can blockchain games really offer a sustainable income?

“The reality is that these are all just games. Some have Web3 elements, and some don’t; as long as they are fun to play, this is what, in essence, determines whether a game is successful or not,” Poulson added.

Web2 gaming companies have also been hesitant to adopt Web3. According to a Nov. 13 State of Web3 Gaming report released by Game7 — a decentralized autonomous organization dedicated to accelerating the adoption of blockchain technology in gaming — six out of 10 Web3 games are being excluded from mainstream distribution platforms.

However, the report found some progress in marrying the mainstream with Web3 and blockchain games. Video game digital distribution service Epic Games Store has been listing more Web3 games every year, peaking at an all-time high of 69 in October 2023.

Could Web3 games survive without a mainstream audience?

Mainstream audiences are important for the future of Web3 and blockchain games, but if the bulk of those players don’t ever make the switch, Poulson believes they will survive and likely “continue as they are today.” 

Related: Web3 gaming investors more ‘choosy’ in crypto winter — Animoca’s Robby Yung

However, she thinks that eventually, all games will have elements of Web3, whether gamers are aware of them or not.

“More than likely, the underlying technology will morph into the mainstream gaming world where the average gamer can finally realize the benefits it offers, especially when it comes to ownership of in-game digital assets,” Poulson said.

“Eventually, gamers will not know they are even playing a blockchain game; the Web3 elements will be so seamlessly integrated into gameplay that it will be a similar experience to what playing a game is today.” 

Daniel Paez, a former senior manager at major gaming company Blizzard (Warcraft, Diablo, Starcraft), also thinks mainstream audiences are critical for the future of Web3 games because of the sheer size of the player base. 

According to an Oct. 9 report from CoinGecko, over 800,000 people play Web3 games daily, regardless of market conditions. However, on average, the Web2 game Minecraft has over 11.9 million daily players.

Paez, the current vice president and executive director for the Web3 card game Gods Unchained, told Cointelegraph that while mainstream audiences are necessary for Web3 and blockchain games to thrive, he is not convinced they are required to survive.

According to Paez, the key to longevity for Web3 games will be to focus more on the player experience instead of blockchain elements.

“This, of course, puts them into direct competition with thousands of other games, but the benefits greatly outweigh the cons,” he said. 

“The market for gamers is significantly larger, and you begin to build out communities of players who share the game experience with each other, as opposed to communities of users who hold assets from the same game.”

Paez says Web3 games in search of “longer lifespans” will need the mainstream audience long term because selling content and experiences to players is the foundation of the games industry.

“The challenge for blockchain games is figuring out how the blockchain element can really improve the perceived value a player has of the game,” Paez said.

“The payoffs from figuring this out are huge!” he added.

According to the online data gathering platform Statista, the traditional gaming market is projected to generate over $400 billion in 2023. It is expected to continue growing and reach $584 billion by 2027.

In contrast, the Web3 and blockchain game market has yet to come close to such lofty heights. According to data from market intelligence firm Grand View Research, it was valued at just over $4.8 billion in 2022, with projections predicting growth in the coming years. 

Ultimately, Paez believes there will always be room for more “GameFi-esque type games,” however, they will be at the mercy of the crypto markets, which are notoriously volatile.

GameFi, short for game finance, allows players to earn rewards in the form of tokens or NFTs. Players can then use these rewards to purchase in-game assets and cash them out for fiat currency.

One breakthrough application will be all it takes

Michael Rubinelli, who has previously worked at Disney, THQ and Electronic Arts, told Cointelegraph he thinks mass market adoption is vital for the future of Web3 gaming.

Rubinelli, who is currently the chief gaming officer at Web3 gaming platform WAX, said that to attract players, there needs to be a “guiding principle” that clearly shows the benefits of Web3 to both Web2 developers and players.

This “breakthrough application” is what Rubinelli says Web3 games are in search of right now.

“Until such a killer application emerges, conventional gaming companies are likely to remain observers, awaiting guidance from those who pioneer the path,” Rubinelli said.

Related: Free-to-play Web3 games hold the key to mass adoption — YGG co-founder

It’s anyone’s guess if mainstream gaming companies will ever come on board with Web3 games. According to a 2022 survey of Web2 game developers by Coda Labs, three out of four expect to work on Web3 games in the future but did not provide a firm timeline.

Overall, Rubinelli thinks Web2 gamers are important but feels a key indicator of whether Web3 games will stand the test of time will be whether the industry can achieve specific objectives.

“It’s not about whether a mainstream audience is drawn in or not; rather, it’s about reaching a pivotal moment that enables all stakeholders to achieve their product and business objectives,” he said.

“Even if the audience doesn’t materialize, the enduring concept remains: players desire ownership and control over their digital assets.”

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How the actor model could enable better blockchain gaming apps

Can developments in computing help fix blockchain gaming’s quality problem?

Decentralized applications (DApps), including apps for gaming, have gained traction for their transparency, security and user asset ownership. However, delivering high-quality AAA gaming experiences through DApps presents challenges.

Existing 2D gaming DApps operate on blockchain networks using smart contracts for asset management. While they’re favored for their simple mechanics and resource efficiency, their limitations become evident as the complexity of the gaming experience increases.

Scalability is a primary hurdle for traditional blockchains like Ethereum, impacting real-time interactive gaming due to constraints surrounding transaction throughput and latency.

Performance is also an issue. AAA games require high-performance computing and superior graphics rendering. Yet, existing DApps struggle to meet these demands, resulting in subpar visual experiences.

Moreover, developing AAA gaming DApps is costly due to resource-intensive tasks and blockchain execution fees. Balancing immersive experiences with user-friendly expenses complicates the use of traditional DApp frameworks for AAA games.

What is the actor model?

The “actor model” is a communication model that enables parallel computing and asynchronous messaging within a blockchain protocol, making it possible for developers to build complex DApps with less difficulty.

The actor model is used within the Gear Protocol, and development was led by Nikolay Volf, founder of the Gear Protocol and Vara and one of the key developers of Polkadot and the Substrate framework.

Within the model are actors — programs or users that send messages to other programs in the protocol. Each actor has a mailbox and a private state that cannot be changed directly by another actor, rather they can only change states by receiving a message from another actor.

Messages between actors are taken from the mailboxes and processed in cycles. Once an actor has received and processed a message, they can either send a message to another actor, create an actor or change its state.

How is this beneficial for DApp development?

Asynchronous message handling in blockchain programming offers several significant benefits that contribute to the overall efficiency, scalability and reliability of DApps.

Firstly, asynchronous message handling allows for non-blocking processing of transactions and smart contracts.

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Unlike synchronous processing, where each transaction must be executed sequentially, asynchronous messaging enables concurrent execution of multiple tasks.

This parallel processing capability enhances the performance of the blockchain network, as it can handle a larger number of transactions and computations simultaneously, resulting in reduced transaction processing times and improved overall throughput.

Jack Platts, co-founder of Hypersphere — a crypto venture capital fund that has invested in gaming projects — told Cointelegraph, “In traditional synchronous systems, multiple tasks often have to wait for each other, leading to a slowdown when processing a high volume of transactions.”

Platts continued, “In the context of blockchain networks, this parallel processing capability becomes vital for maintaining high transaction throughput. As more transactions are initiated by users, the system can handle them concurrently, ensuring faster confirmation times and overall improved network performance. This is particularly crucial for blockchain gaming, where real-time interactions and quick processing are essential for providing a smooth and enjoyable gaming experience.”

Some blockchain games, such as Ember Sword, have already integrated parallel processing into their development processes. Mark Laursen, co-founder and CEO of game development company Bright Star Studios, told Cointelegraph, “In the development of Ember Sword, we employ parallel processing utilizing our ECS [entity component system] solution. Typically, there would be a necessity to manually integrate multithreading and make intricate decisions on a system-by-system basis.”

Laursen continued, “However, in our scenario, the requirements for reads, writes and ordering dependencies are specified, allowing our engine to discern the most efficient method to schedule and parallelize those systems.”

Let’s say a player of a blockchain game wants to transfer an in-game item in the form of a nonfungible token, like moving a legendary sword from their chest (wallet for long-term storage) to their inventory (wallet used for gaming).

The transfer process can happen instantly with low or near-zero fees, the same way a player can simply click and drag a sword from their inventory and move it to a merchant or chest in a traditional game.

Additionally, with asynchronous messaging, blockchain developers can design DApps that are more resilient to fluctuations in network conditions and temporary failures.

Pavel Salas, chief growth officer at Gear Foundation — the organization behind the Gear Protocol — told Cointelegraph, “The actor model actually boosts the dependability of applications that run on blockchain,” adding:

“Since actors process messages independently, failure or issues with one actor do not affect others, preventing cascading failures and improving the overall robustness of the system. And suppose there are disruptions or network trouble, the actor model allows the system to recover quickly and continue functioning seamlessly.”

This can be beneficial for blockchain gaming DApps if there is a network outage, allowing the game to continue running despite any issues on its blockchain.

Moreover, asynchronous message handling enhances the scalability of blockchain networks. Traditional synchronous approaches may lead to bottlenecks and performance degradation as the number of users and transactions increases.

In contrast, asynchronous messaging allows for the distribution of tasks across multiple nodes, enabling the system to scale more efficiently and handle higher transaction volumes without sacrificing performance.

Salas said, “As the user base and activity within the DApp grow, the system can easily manage increased message traffic without causing bottlenecks or slowdowns. Even if a single application grows, it will still manage messages sequentially.”

This scalability is crucial as blockchain networks aim to support a growing user base and accommodate diverse use cases.

Salas continued to explain how the process works: “Through the actor model, individual actor-programs act as shards, ensuring that the system can be shared by design as the number of programs grows. [...] Vara processes all transactions without sharding across bunches of nodes; each node handles everything. However, within Vara, each program operates independently, containing its own state, processing and sending messages according to its specific logic.”

“In blockchain gaming, where real-time interactions and quick processing are crucial, the actor model’s sharding capability ensures fast processing of game-related actions and events, supporting a seamless gameplay experience.”

“As the number of actor-programs increases, the system shards and distributes the workload, effectively accommodating the growing user base and maintaining a responsive and efficient network.”

Another benefit of asynchronous message handling is its support for event-driven architectures in DApps. Instead of continuously polling for updates, DApps can subscribe to specific events or messages, allowing them to respond promptly and efficiently to changes on the blockchain.

This event-driven model reduces unnecessary computational overhead and conserves network resources, leading to more efficient and responsive applications.

Moreover, implementing actor messaging capabilities can significantly enhance the overall user experience by mitigating extended waiting periods for transaction validation. Adopting asynchronous processing allows the actor to receive a message acknowledgment of their transaction along with a pending transaction ID.

Subsequently, any computational tasks or external data dependencies can be managed by the same or alternate actor in a subsequent block, ensuring efficient processing without compromising the responsiveness of the blockchain network.

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This real-time feedback is especially crucial for applications requiring quick confirmations.

As the blockchain ecosystem continues to grow and diversify, leveraging asynchronous message handling becomes essential for creating powerful, AAA-style gaming DApps that can cater to the demands of an expanding user base and meet various use cases across industries.

By adopting this methodology, developers have the opportunity to expand the limits of decentralized gaming and potentially realize the complete capabilities of blockchain technology within the gaming sector.

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AI a powerful tool for devs to change gaming, says former Google gaming head

Ryan Wyatt deciphers the the possibilities for AI to help gamers and game developers achieve.

The world embraced artificial Intelligence (AI), hoping to see it transform complex and day-to-day processes. While generative AI models won millions of users, discussions around the transformative potential of AI in all walks of life became mainstream. 

Today, AI is being tested across all business verticals as entrepreneurs challenge the status quo, streamlining and automating processes in varying industries. This drive also resurrects ecosystems that have lost their vigor over years of trial and error.

In the quest to find the true potential of this technology, humanity continues to infuse AI elements into existing systems in the hopes of outperforming current limitations.

The gaming ecosystem sees AI as a means to supersede incremental upgrades. From reutilizing seasoned hardware to squeezing out the price-performance ratio from the latest graphics processing units (GPUs), the gaming industry sees AI’s potential to redefine how gamers of the future will consume their products.

“AI will be one of the most important tools for game developers to improve their work output and production, and unlock rich and new experiences for gamers,” said Ryan Wyatt, the former global head of gaming partnerships at Google and former head of gaming at YouTube.

Wyatt’s exposure to gaming — on both professional and personal fronts — allowed him a special viewpoint at the intersection of a gamer’s wishful thinking and an entrepreneur’s reality check.

Wyatt garnered over two decades of gaming experience before entering crypto as the CEO of Polygon Labs, eventually retiring as the president to take up an advisory role for the blockchain company.

Speaking to Cointelegraph, Wyatt reveals how AI could potentially transform the gaming ecosystem and what it could mean for the future of blockchain gaming.

Cointelegraph: What is the role of AI in the gaming ecosystem?

Ryan Wyatt: The term “AI in gaming” has been overused to the point of exhaustion. In my opinion, it is simply another powerful tool in the developer’s toolkit, which is already extensive and continues to grow. This expansion of toolsets — AI being one of them — will enable a variety of new gaming experiences that we have never seen before and allow game developers to do more. We often talk about AI as a replacement for the work being done in gaming, but I strongly disagree. I see it as a powerful tool that will allow game teams, both small and large, to do more than they ever could before, which may require human resources to be leveraged differently but not minimize or diminish the importance of the many roles required to make a game. And in return, gamers will get to experience games that were never deemed possible before.

CT: Can AI potentially take up the heavy computational tasks that currently rely solely on GPUs? Do you think AI could allow us to repurpose legacy systems that contribute to e-waste, or is it just wishful thinking?

RW: This is a tough one. I do think it is wishful thinking to assume that AI can repurpose all these legacy systems and reduce e-waste. Based on the track record of how hardware has grown and advanced so much over the last two decades, there’s no indication to believe we’re moving in the right direction here, as we’ve continued to increase e-waste over the last 10 years. From a technology standpoint, we’re constantly evolving, and the necessity and demand to expand on hardware, specifically with the GPU, continues to increase significantly. I believe there will be a number of optimizations that AI can introduce to the problem: offloading more resources to the CPU, optimizing for legacy systems, etc., but I think it’s wishful thinking to assume we can reduce e-waste as we continue to push the limits of technology and hardware to create things that were never imaginable before. This seems like a problem that isn’t going to be meaningfully resolved over the next decade, and, in fact, I anticipate it to get worse before it gets better, with AI exacerbating the issue in a 5–10 year time horizon. 

CT: If AI could be used for graphics optimization, unlimited (free world) map rendering or a storyline that never ends, but you could choose only one, which one would you choose as a gamer, and why?

RW: This is a matter of personal preference, but I hope we see both. I believe that storylines and NPCs [non-player characters] could evolve greatly from where they are today. We have seen amazing and beautiful open worlds expand in parallel with computational and hardware improvements. While not unlimited, expanding worlds have played a meaningful role in games over the last decade.

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To me, one area that needs to evolve is how we engage with NPCs in games. This has been rather archaic for quite some time and has largely relied on linear lines of pre-programmed communication and dialogue. This is already changing with companies like Inworld AI and the work they are doing; their tech helps a game developer craft unique and memorable AI NPCs with its fully integrated character engine.

Their engine goes beyond large language models (LLMs) by adding configurable safety, knowledge, memory and other controls in place. The characters then have distinct personalities and contextual awareness, which is insane to see from a gamer’s perspective.

We haven’t had these kinds of dialogue interactions inside of games before, so it’s hard to wrap your head around how it will change the industry because it’s just something that was once unfathomable. Once these developer tools are seamlessly integrated into proprietary engines of large AAA publishers, you’ll see a new era of immersive game experiences. I also believe you’ll see a huge burden lift on the game development cycle that will allow for expansive worlds by not just large studios with companies like Kaedim; you effectively reduce all of the hours lost in modeling by simply generating stunning 3D art with nothing more than an image. These are the types of tools that are going to advance and multiply game development and usher us into a new era of gaming.

The interesting thing is the collision of both of these topics over the next decade!

CT: What are your thoughts on blockchain gaming? How did you find it different from traditional/mainstream titles?

Blockchain gaming is another tool in the toolbelt for game developers and gamers to change the way we interact with games. By storing assets and information on a blockchain, which is not owned by any intermediary, we can expand upon value exchange between game developers, users and gamers (peer-to-peer). This is done inefficiently today, and although some examples come close, such as CS:GO, it is still far from perfect.

The entire crypto space is going through a much-needed reset, washing away bad actors, and from the dust, you will see true, well-intended pioneers and innovators emerge. The unfortunate abuse of the financial aspects of crypto has made many game developers, especially in the West, apprehensive about incorporating blockchain technology into their gaming infrastructure stack, which I believe is temporary.

However, in the East, we are seeing top gaming developers (e.g., Square Enix and Nexon) fully commit to blockchain gaming due to the new game mechanics and relationships that can be created between gamers and developers. I fully expect the re-emergence of blockchain conversations being driven by the application layer in 2024 to 2025, which will do a better job of illustrating the power of launching games on blockchain infrastructure stacks, even if only certain aspects of games are built on them. The last three years of crypto have been dominated in conversation at the infrastructure (blockchain) layer and finance (decentralized finance (DeFi) sector, and ironically, the abuse has come from bad actors of centralized platforms (such as FTX) that don’t even embrace the core values of decentralization.

CT: From a gamer’s perspective, what do you think AI can do to help the widespread adoption of blockchain gaming?

RW: I’m not sure if blockchain gaming will become widely adopted anytime soon; we’re still years out from this, and there are great companies that are pushing the envelope here, like Immutable, but I do think that as AI becomes materially indistinguishable from reality, there is value in blockchains holding accountability over the advancement of AI. This is because blockchains are transparent and immutable, meaning that they can be used to track and verify the provenance of AI-generated content. This is important because it will help to ensure that AI is used ethically and responsibly and that it does not create harmful or misleading content.

I am certain that we will see blockchains in the future host authentic and verifiable information in a world where things coming from AI become indistinguishable from reality. This is because blockchains provide a secure and tamper-proof way to store data, which is essential for ensuring the authenticity and reliability of AI-generated content.

CT: Despite the involvement of the people behind mainstream titles, the blockchain gaming industry has not taken off, unlike other crypto sub-ecosystems. What could have been done differently?

RW: I think this is largely misguided due to timing expectations and the underwhelming first iteration of blockchain games. Game development cycles are so long, and the first batch of blockchain games were either rudimentary, rushed to market, had the wrong incentive mechanisms, were not highly produced or had other issues. There also have been blockchain infrastructure woes that have needed time to overcome, [such as] gas costs, difficult user journeys to navigate and other infrastructure challenges that are just now starting to be resolved by layer-1 and layer-2 protocols.

However, I’ve seen a lot of amazing blockchain games in development that will be released in 2024 to 2025. These games will truly explore the uniqueness that blockchain games have to offer. Games are such a monumental lift to create, and the ones that go deep with either small or large teams will ultimately need more time to show their work. There has been an outsized amount of capital deployed into blockchain games, in the several billions of dollars, and we’ve only seen a single-digit percentage of releases from that cohort of investment.

CT: What went wrong with blockchain gaming? Why don’t gamers buy into the idea of play-to-earn?

Play-to-earn as a philosophy isn’t that crazy. Game developers are always looking to reward gamers for spending more time in their game because longer session times equate to more value, which is captured by the game developer. So, conceptually, this idea of putting time into a game and being rewarded for it isn’t a new game mechanic.

Play-to-earn in blockchain games tries to expand upon this concept of value exchange from developer to player.

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However, the economies are really difficult to balance when you don’t have the autonomy over every aspect of them due to the nature of them being decentralized. Ultimately, this has either led to pure abuse of the category, unfortunate attempts to do right and fail or will need more tinkering to ultimately find the right token and economic strategy.

CT: Speaking from a different angle, what benefit could AI and blockchain bring to mainstream gaming? What could compel developers to adopt and infuse the tech into their existing gameplay?

RW: There is certainly a chicken-and-egg issue here. Game developers need to push the limits of what these technologies can do, learn from it, iterate on it and then showcase it to gamers to see if this is what they truly want. But at the end of the day, the large games continue to dominate viewership on YouTube and Twitch.

Steam’s top games, such as DotA and CS, have remained juggernauts, and breakout hits like Minecraft and Roblox are generational unicorns. Both of these games took over a decade to materialize into what we know them to be today. In order to achieve mass adoption, you will need to see these games permeated with the technology. I believe that both of these technologies — AI and blockchain — will have breakout moments from native app developers and indie game devs. However, for true mass adoption, larger players will inevitably need to incorporate the technology.

Disclaimer: Wyatt is an angel investor in many AI, Gaming and blockchain companies, including Immutable and Kaedim, both of which are mentioned in his responses.

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