Today, the vast majority of online games follow a centralized model. This implies that all game data is stored on a server fully controlled by the game administrators: account information, server history – which records and stores all events – and also the internal game assets collected by the players – collectible items and virtual money. 

 

Because the database is owned by a single company, players are not in actual possession of their accounts and items. In addition, centralized servers present many vulnerabilities, such as malicious infiltration of the system, undeserved blocking of some accounts and manipulation of the game economy by administrators and developers. Blockchain technology comes, once again, to solve this problem. Blockchain gaming and NFT games: what are they? 

 

How can blockchain impact the gaming industry? Blockchain gaming and NFT games. 

 

We can find several ways in which the distributed database brings its benefits and opportunities, for example: 

 

User-centric ownership 

 

A blockchain-based system makes it easy for users to verify and protect their digital items, game histories and tokenized assets, to exchange them at a time of their choosing. The basic premise is to shift the power from being centralized in the gaming companies to the players themselves. Game assets can include skins, characters, equipment and so on. In general, each asset is represented by a unique and non-fungible token (NFT), such as ERC-721. Blockchain gaming and NFT games. 

 

Optimization and ease of payments Blockchain gaming and NFT games. 

 

The blockchain and smart contracts have the ability to speed up financial transactions and payment processing, as well as in certain cases reduce fees. This applies not only to P2P exchanges between players, but also between players and developers. Blockchain gaming and NFT games. 

 

Decentralized marketplace 

 

As previously mentioned, centralized gaming companies have the power to manipulate the economics of their games and also block internal game items to prevent players from trading them. Games running on blockchain networks, however, allow the creation of decentralized marketplaces. This removes the need for trust between players and, in turn, provides resistance to censorship. All players can buy, sell and exchange their internal game assets freely. 

 

Interoperability between assets from different games 

 

By linking game items with blockchain tokens, players can trade assets between different games, enabling interoperability between games, however different they may be. Since game items are represented by digital tokens, players can trade these tokens on other game marketplaces, hosted on the blockchain itself. 

 

Transparency 

 

The blockchain enables the creation of open source, distributed and transparent game servers. Within this dynamic, game mechanics can only be changed if the majority of the network votes in favor. In addition, the distributed and decentralized nature of blockchains prevents hackers from disrupting the game because there is no single point of failure. 

 

Decentralized game 

 

When a game exists on a centralized server, developers can leave the project or shut down the game at any time. With the blockchain, however, players can continue to play even if the developers walk away. As long as the blockchain network continues to operate, the game will remain alive. 

 

Limitations 

 

While blockchain technology opened a new horizon for the gaming environment, it is still at an early stage and, as such, has significant challenges to overcome. Some of them include:

 

• Lack of adoption: Most games have a very small number of players compared to centralized gaming networks. 
• Scalability: Blockchains tend to be much slower than centralized networks, which can prevent games from growing on a global scale.
• Centralization (in some cases): Not all blockchain-based games are completely decentralized. Some use ERC-721 or other blockchain tokens, but they actually run on a centralized server.
• Simplicity: There are some exceptions, but most blockchain games are too simple to appeal to gamers who value a more elaborate gaming experience and high-quality graphics (the famous “hardcore gamers”). 
• Entry barriers: Raising funds to start and maintain a blockchain game can be challenging for developers to work with.
• Competition: Blockchain games are often developed by small, independent companies (indie games). These teams may find it difficult to compete with giant game companies from the centralized world.

 

Fortunately, numerous solutions are being developed with Lightning Network and other Layer 2 solutions to address the scalability issue.

 

Compared to the traditional gaming industry, the blockchain gaming industry is still niche, new and relatively small. Still, there are hundreds of DApps and games built on blockchain networks, such as Decentraland, Axie Infinity, Plants vs. Undead, Cryptokitties and more.

 

Conclusions 

 

Blockchain technology has great potential to bring benefits to the gaming industry, as it provides significant improvements for players and developers, especially in terms of decentralization, interoperability and transparency. 

 

If developers manage to overcome the main limitations, blockchain will probably change the gaming world for the better, and we will probably see more, new and better platforms than the existing ones as a form of gaming revolution. We can also consider the possibility of large centralized gaming companies making alliances to incorporate blockchain in certain elements to deepen this adoption path, in the long term.