Why the abandonment of the play-to-earn model by video game studios is positive for crypto?

The major video game studios are reviewing their title development plans “play-to-earn” based on the blockchain, in the context of an ongoing slowdown in the GameFi and crypto sectors as a whole. According to sources cited by Bloomberg, NFTs and cryptocurrencies introduce a speculative and lucrative element to the game that at least some major publishers would prefer to avoid.

However, while some studios have effectively abandoned development of these titles, others appear to be taking a wait-and-see approach, refusing to pull out of the space altogether until market conditions improve.

At the same time, the withdrawal of some major developers would no doubt benefit the play-to-earn space. Indeed, this would allow native cryptocurrency studios to develop their titles more organically and in line with the spirit of the crypto industry itself, without being subject to external pressure from multinational corporations.

Major game studios are losing interest in the “Play-to-Earn” approach

From the perspective of traditional studios and the average gamer, there are a few good reasons why most game developers should stay away from play-to-earn, GameFi and cryptocurrencies, at least for the instant.

First, non-fungible tokens have the potential to create divide and inequality among players, separating those who can afford to acquire high-priced NFTs from those who cannot. This is an argument made by the developer of MinecraftMojang, who summed up his sentiment in a blog post forgotten in July.

“The speculation and investment mentality around NFTs distracts from the game and encourages profit making, which we believe is not compatible with our player’s long-term joy and success,” a- he writes.

This view is shared by other mainstream game developers. Mark Venturelliwho has started a diatribe against crypto gaming in July, also told Bloomberg that NFTs can harm the enjoyment of gaming, potentially turning it from a source of entertainment into a crude money-earning device.

“When you put those two together, it’s easy to see why they don’t see the point of gimmicky technology that provides nothing more than a system to make a quick buck,” a- he declared.

Other industry figures simply claim that games have yet to find meaningful use cases for cryptos or NFTs that could add real value to games.

“Sometimes it’s a hammer looking for a nail when these technologies appear,” said Phil Spencerof Microsoftat a maintenance with Bloomberg TV last month.

While these statements and opinions may seem isolated, research indicates that the gaming industry as a whole is not particularly excited about play-to-earn and GameFi at this time. A survey conducted in August with 300 developers by the software consulting company Perforce revealed that 49% believe that NFTs would have ‘minimal’ impact on games, if any impact at all.

Even developers working on blockchain-based games largely share the concerns of mainstream developers. Speaking at the Tokyo Games Show 2022 last week, developer Luke Sillaywho works with Blowfish Studios (property of the publisher ofAxie Infinity, Animoca), said far too many “play-to-earn” titles simply don’t measure up as entertainment.

He said, “You can see in a lot of blockchain games that they’re not really fun. Yes, you have the opportunity to earn quite a lot of tokens and you get a good return on investment most of the time. But generally speaking, they’re not entertaining, are they?”

A pause in the implementation of plans

Translated into concrete decisions and actions, it seems that such ambivalence towards play-to-earn and blockchain-based games has led major studios to shelve past crypto-related projects.

Take-Two Interactive has in particular acquired mobile game developer Zynga for the sum of $11 billion in January, with the GTA publisher saying at the time that Zynga’s blockchain ambitions weighed in on its decision. However, although Zynga has announcement in February that it planned to launch its first blockchain game later this year, no further announcements were heard from Zynga or its new parent company.

Likewise, Square-Enix announced the launch of an NFT collection on the theme of Final Fantasy in July of this year, after having announcement in January that it was aggressively pursuing its “R&D efforts and investments” in the area of ​​”blockchain games”.

Square Enix has also reaffirmed its commitment to develop its blockchain-related products in May, but after the launch of the NFT Collection in July, there has been no word on specific blockchain-based games or software. That said, Square Enix has associated with blockchain developer oasis this month, in order to “explore the possibility of exploiting user contributions in the development of new games”.

Such reluctance to engage in NFTs and play-to-earn is easily seen as a blow to a market whose the value has fallen 69% since November last year. Especially when said market has run out of cheering news, with the notable exception of the merger of Ethereum, which however failed to trigger a new bull market.

Balance and perspective

However, while the Bloomberg article seems to suggest that major game studios have moved away from blockchain-based games altogether, other recent news and developments suggest a more mixed and encouraging picture.

To cite the most positive example, recent funding data revealed that the only sub-sector of the crypto industry to see growth in venture funding last month was GameFi and NFT. Indeed, it enjoyed a 66% increase in venture capital funding between July and August, from $507 million to $842 million.

Why the abandonment of the play to earn model by video game

In addition, some publishers have already started taking a closer look at NFTs and blockchain. Just a few days ago, Epic Games – the editor of Fortnite – has launched the first-ever NFT-based game on its official marketplace: Blankos Block Party from Mythical Games.

And while some studios seem reluctant in the current circumstances, that doesn’t mean they’ve given up on blockchain and play-to-earn. For example, while Take Two has not announced a single game involving crypto elements, the CEO Strauss Zelnick has publicly stated that he intends to do so sooner or later, despite Bloomberg’s latest article which quotes selectively from a speech he gave at the 2022 Jefferies Virtual Global Interactive Entertainment Conference in January.

While Zelnick confirmed that Take Two isn’t interested in speculation, he nevertheless said the following :

“It’s definitely going to happen and NFTs will get us there. The question is how do we do it in a way that doesn’t harm consumers.”

This suggests that major game studios are likely biding their time during a market downturn, waiting to see what will happen before moving forward with their past projects.

The positive sides

And even if some developers are moving away from play-to-earn, it would have some benefits for blockchain gaming and crypto in general.

Indeed, the absence of major studios would allow independent developers to refine and evolve their products more slowly and steadily, building them in dialogue with their communities, instead of rushing to respond to external pressures from listed companies. in stock exchange.

Without too much involvement from major studios, smaller independent developers will have more room to grow and produce their own titles. This includes emerging platforms such as Battle Infinity and tamadogetwo play-to-earn metaverses that promise to combine the best elements of cryptocurrency and gaming, without giving too much weight to either side.

Decentralization has allowed cryptocurrencies to evolve to their current state. It’s hard to imagine what Bitcoin or any other cryptocurrency would look like if they were launched from the top down, with only venture capital to fuel them. This would likely have hurt crypto’s early growth and (arguably) radical potential, and the same could be said for blockchain games, which will now enjoy a combination of major top-down support. bottom and minor bottom-up evolution.

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Why the abandonment of the play-to-earn model by video game studios is positive for crypto?

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