Welcome to Part 3 of my gaming cryptocurrencies post series!

In Part 1 I gave you a history of gaming, specifically how games were purchased and how they are “purchased” today. We saw how in-game microtransactions have overtaken traditional game purchases as a method of generating money for game developers.

In Part 2 I looked at the rapidly growing popularity of gaming, including eSports. We saw how much money is flowing into the gaming industry and how many games have their own currencies, currencies which are purchased using the above-mentioned microtransactions.

Today we will look at the main types of gaming cryptos available. We will also take a quick glimpse at some specific ones.

From https://pixabay.com/en/money-dollar-coins-tree-finance-1846826/

How to: Win the game of cryptocurrencies - Part 3

It was inevitable that cryptocurrencies and games would meet. I have watched with interest how some governments have attempted to define cryptocurrencies: money, assets, securities etc. – all terms which have been debated and thrown around. It is with extreme amusement that I have noticed some governments essentially equate cryptocurrencies to in-game currencies. When your cryptocurrency has, for example, been defined as a Digital Virtual Currency and the definition thereof matches an in-game currency too, things get complicated! What’s next, will you get taxed on virtual gold you mine playing a game? Obviously that’s just silly, but it’s a can of worms that they are opening up by trying to squeeze revenue out of that which they have no right to claim! You may as well demand that people are licensed to carry virtual guns if they want to play Counter-Strike!

I’ve digressed a bit; my point is that premium in-game currencies and cryptocurrencies are already very close in some ways.

I want to now look at the main gaming crypto types. I think you will be shocked to see just how many gaming coins there are. Due to the sheer number and variety of gaming coins (and by "coins" I mean tokens too), I am only covering the main sectors and coins. Smaller niche markets do exist, as do multitudes of coins that I will not mention at all.

Types of gaming cryptos

Before going any further, I think you need to see how stiff competition is becoming in this market space. This is why you don't want to go off half-cocked and just buy anything that professes to tie "cryptocurrency" and "gaming" together:

The image above is taken from https://cryptoslate.com/category/cryptos/gaming/ . I would like you to quickly click that link and visit the page (it will only take you a few seconds). Marvel at the sheer number of coins there as well as the different types of coins. Scrolling through them, I have noticed that they have missed several gaming coins that I know of (I'm not a gaming coins specialist, so there are probably many more than just the 137 mentioned there!).

This should be ringing alarm bells in your head. There is no way that all of these coins can or should survive. Far too many are probably poorly planned, poorly funded or mismanaged. As with all cryptos, you need to carefully select the right ones; the ones that will not only survive, but that will do well!

With that out of the way, let's take a look at what I would categorise as the main or important types of gaming cryptos.

The versatile replacement for in-game currencies

The first type of crypto is like an in-game currency, only better. We've spoken about microtransactions ad nauseam, so I don't have to elaborate too much here. What these coins essentially aim to do is to interface directly with the premium in-game currencies. Let's take two examples from yesterday's post. Clash of Clans (CoC) is a phone game that uses "gems" as its premium currency. World of Tanks (WoT) is a PC game that uses "gold" as its currency.

The developers of both have each produced multiple games. Supercell, the developer of CoC, has several other successful titles under its belt: Hay Day, Boom Beach and Clash Royale. In order to keep players playing by offering them more, it is relatively easy for Supercell to make premium currencies portable between its games. I don't know if it has yet, honestly I don't play any of its games any more, but Supercell could e.g. let you buy currency for Clash Royale and spend it in CoC. It is important that you realise that the modern gamers, the phone variety, have very limited attention spans. These are not the wizened, old Bit Brain-like gamers of yore. These are children, casual gamer older adults, or millennials who possess about as much focus as goldfish. To keep them interested the developers must constantly offer something new in the games. Even so, players can be lost rapidly to whatever is newer and more exciting. This is why there is a strong incentive for the developers to create their own "new and exciting" games and to allow the players to transfer their in-game currencies across from one game to another. If they fail to offer these perks, they will lose players. Simple. Since you saw yesterday what that player base is worth, nobody wants to lose players!

Similarly WoT is owned by a company called Wargaming. Wargaming has kept players also by a string of updates and in-game events (e.g. a recent Football World Cup event). Not all of the updates are what I would even consider to be good or healthy for the game - many are blatantly done to appeal to a generation which demands instant gratification and which suffers from the afore mentioned short attention span. But that's not important. Of importance is that Wargaming published more games: World of Warplanes and World or Warships to keep things interesting. They went a step further and made watered down phone versions: World of Tanks Blitz and World of Warships Blitz to attract and keep an even larger share of the gaming market. They also have other unrelated games. Their games all use the same premium currency: "gold". As far as I know, "gold" is not yet transferable between games, but as one login works across multiple games, it should be easy to make it transferable. If they want to keep their players this is what they will do.

These are just two examples. I think that in the short-term the developers are hesitant to make their currencies transferable between games because that means that a player would no longer be forced to buy currencies for each separate game, thereby losing the developers some money. But in the long-term it would make good business sense to keep players happy and to give them what they want and make their lives easier. Failure to do this may well result in the gamers seeking greener pastures and spending their money elsewhere.

From the point of view of the gamer: what gamers desire is to be able to transfer their funds between games. If such a system did exist, where a gamer could move money between games, then a gamer would be far more inclined to play a game which supports the system, thnn to play one which does not. And this, ladies and gentlemen, is where cryptocurrencies meet gaming!

The first, biggest and (in my opinion) best gaming cryptos were developed to tackle this problem. Cryptocurrency platforms have been created with the idea of being able to transfer in-game assets, or at least their value, between games. If game developers use these cryptocurrenceis, then value can be swapped not only betwen the likes of World of Tanks and World of Warplanes, but also e.g. between Clash of Clans and World of Tanks. I could, for instance, sell a tank in WoT to raise funds to upgrade my Town Hall in CoC. This would keep me, the player, playing both games and would prevent me from moving away to games which do not support the same cryptocurrency.

I have bought two cryptocurrencies of this variety. I believe that there are three worth holding: Enjin Coin, WAX and CryCash. Enjin Coin (https://enjincoin.io) runs a very versatile platform and features both fungible and non-fungible tokens. This is fantastic because it means that specific in-game assets e.g. a specific tank can be linked to a player's crypto wallet. The benefits of this are numerous. It allows for things like: much greater security: the player's account can't be stolen without stealing their wallet private key (and even then it may be difficult). A player could trade their tank with another player. A player could sell their tank for fungible coins and then buy something else with the proceeds of the sale. Of course the developers could charge a fair fee for turning in-game items back into coins. For the developers, initial profits may well drop, but this is a train that they need to be aboard, because those who are short-sighted and miss it are going to be left behind!

I hold a position in Enjin Coin, but sadly not in WAX. WAX (https://wax.io) is a popular crypto and has performed relatively well this year (considering the bear market). I would buy WAX if I had the funds to do so. Wax stands for "Worldwide Asset Exchange" and, as the name suggests, is a market for trading game assets. Even if the assets can only be traded within the scope of one game, this is a start and things will surely branch out from there (as I have mentioned in previous paragraphs). CryCash (https://crycash.io) is more of a Dark Horse. It is not nearly as popular as the other two, BUT I hold it for a reason: CryCash was developed for the "Cry" games series. It has recently started to be awarded to players of Warface: Turkey through an app known as Plink. This means that gamers are being issued a currency. They will want to trade it... The "Cry" games are developed by a studio called Crytek (http://www.crytek.com) which is very well know in gaming circles for some remarkably good FPS (First Person Shooter games): The Crysis series and the FarCry series. I am of the opinion that it will be hard for CryCash to fail when linked to a powerful gaming partner like Crytek. It should be no surprise to learn that Warface (https://wf.my.com/en) is a free-to-play game and is also eSports friendly. With that in mind, go look at coinmarketcap and see how CryCash is doing (https://coinmarketcap.com/currencies/crycash/). Look at the market cap. Look at the volume. Fool's errand or deal of the century? You decide. For my part, I've been in since the ICO and am holding strong! The price drops just make me giggle!

That was the most obvious use (at least to me) of cryptos in the gaming industry. It's also where I have invested most of my money (Enjin Coin followed by CryCash) Let's look at some slightly less obvious uses.

Crypto games

Since crypto platforms (such as Ethereum) are basically just large, distributed operating systems, it makes sense that people would develop games for them. The best known of these must be Cryptokitties (https://www.cryptokitties.co): a game most famous (notorious) for bringing the Ethereum chain almost to a grinding halt as the game spiked in popularity! HashPuppies is a NEO based game which is no doubt looking to emulate the success of Cryptokitties. Tokens for the game were airdropped to qualifying NEO wallets. In an unusual turn of events, NEO wallets with less than 100 NEO in them got the token (1 each) and not wallets with more than that. I believe it was to encourage the newer NEO holders to continue using the NEO platform. I was lucky enough to qualify (sometimes not being rich has its advantages) and so I am looking forward to the release of this game - though I would not normally have invested in something like it. Nevertheless, games like this offer unique "puppies" or "kitties" to each player, making them enormously collectible. Some Cryptokitties sold for ridiculously large sums of money! (Over $100 000!)

Decentraland (https://decentraland.org) is a place I would put money (if I had it). It is far more advanced looking that the above two games. It's a virtual reality world (something along the lines of Second Life) where you can buy (or rent or sell) "land" within the game world and craft and trade 3D assets. Once again blockchain technology secures your assets from theft. This may prove to be a very popular game/alternative reality.

Huntercoin (http://huntercoin.org) looks like a blockchain based version of Minecraft where, as the name suggests, you can mine the in-game currency in the game itself! Cryptons (https://cryptonsgame.com) is a blockchain based game about robots.

I have seen a very impressive looking space based game with gorgeous 3D graphics, but for the life of me I can't remember its name! Sorry, I'm getting old.

Generally I don't think that blockchains are needed as a part of platforms on which to run games. One of the main tests I apply when choosing a coin or ICO is "Is a blockchain needed to make it work?" In most of these cases I would say "no", it isn't. Because of that I don't see a particularly bright future for these coins, though there is no reason why individual ones should not succeed.

eSports and Fantasy league betting

We looked at the popularity of eSports yesterday. As with most sports, this has led to sports betting; or rather: eSports betting. I do not have to explain this in detail. It is simple as it sounds. You bet on your favourite player or team to win. You can use the likes of Luckbox (https://blog.luckbox.com) or the Unikorn Gold coin (https://unikoingold.com) for betting on eSports. For me this is not an area of interest and I avoid it. But eSports is big and a lot of money will head in this direction. Not all eSports coins are directly realted to betting either. A coin like DreamTeam (https://token.dreamteam.gg) is a general eSports coin with different uses in the eSports world. My pick of these coins if I were to invest in them, which I haven't, would probably be FirstBlood (https://cryptoslate.com/coins/firstblood/), a popular crypto that allows players to challenge one another for rewards.

Not really the same, but closely related are fantasy league cryptos. These are blockchain-based versions of the fantasy leagues that have been run on paper for generations (and more recently on computers): virtual sports teams (e.g. a virtual football team) that "compete" against one another in various ways. For instance - you could have assembled a team of Football players from the 2018 FIFA World Cup and competed against similarly assembled teams to see which team had the players who scored the most goals. Those who do not participate in fantasy leagues may be surprised to discover just how many people do. I'm not into fantasy leagues, but I do know how popular they are, so I took a position in one of these cryptos. The one I chose is called NoLimitCoin (https://nolimitcoin.org/#home). With a busy looking timelime it may do well. Then again, it may fail like many of the others surely will, though I have put in effort to attempt to pick the best coins, so I hope not.

Pure Gambling

The previous category already started to blur the lines between online gaming and online gambling. This category is firmly in "gambling" territory. (Sort of - I'll explain). I would no longer consider these "gaming" coins, but they do share certain characteristics and a common ancestry.

Internet gambling is nothing new. Cryptocurrencies with their blockchains, wallets and smart contracts should make it far safer and more secure. There is a need for blockchain technology in internet gambling. Once again it is not necessary to delve into the details. The basic method of operation is fairly obvious: you buy a crypto and you gamble with it online. If you win you can take it to an exchange and convert it into something useful elsewhere. A good example of such a cryptocurrency would be FunFair (https://funfair.io), a coin I once briefly held for a swing trade.

Let me explain the "Sort of". I have bought one gambling coin. The one which I chose is not an online casino coin like most of the others. I bought Sp8de (https://sp8de.com), a coin which has only very recently been listed on coinmarketcap (I was in the ICO). Since that listing its price has taken quite a dive, making it a very attractive buy. Sp8de is one of the rare DApps built on the Cardano blockchain, already a good sign. The purpose of Sp8de is not be be a casino, but rather to sell true random number generation to online casinos. This sounds unnecessary and easy, but that is not the case! Current online casinos have no guarantee of fairness or no manipulation. Similarly a crypto casino that has its own random number generators could still write the code in its favour. Sp8de will change this by supplying true random generation as a third party. I should mention that I hear that Sp8de have considered opening their own online casino too.

Oh, and those 137 gaming coins we spoke about earlier? They don't even include the gambling coins!

Conclusion

That concludes my three part series on cryptocurrencies and gaming. In a way I'm glad the series is now complete because the amount of research and constantly referring to web pages that these posts require means that they take about twice as long to write as usual. I am a good seven hours or more into Part 3 now and I have yet to finish editing. It's *almost 3am, I need to wake up 3 hours from now, and I'll be at work all night tomorrow. Why do I do this to myself? I do it for you - my loyal readers! 😊

I hope that you have found this series to be enlightening, enjoyable, educational etc. (Too many "e" words in a row there! Purely coincidental.)

For those who are interested: there is a Crypto Games Conference in Minsk in October: https://cryptogames.events . Keep an eye on that for the latest developments.

I think that gaming will be one of the major uses of cryptocurrencies in the future. If not a primary use, then at least a high ranked secondary one. Gaming coins are criminally cheap and largely overlooked. Go look on coinmarket cap at the coins I discussed in this post. Enjin and WAX are quite big (though still small and cheap in the bigger picture), but the others are laughably cheap! I believe that a few clever gaming coins investments could reward you with substantial ROI!

Right, I'm off to bed! After I've done my proof reading that is!

Yours in crypto gaming investments,
Bit Brain

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by Bit Brain

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