NFTs could be the answer
If you’ve played a video game in the past six years, you’ve probably seen microtransactions. You’ve probably seen an in-game store trying to get you to buy their premium currency flavor that you can only get with real money. Games weren’t always like this, but the controversial new NFT technology could be a solution to these modern problems. In this article, we explain how this is possible.
Microtransactions: What’s the problem and how did we get here?
Until the 2010s, games were just things you bought and could play. Sure, in the mid-2000s most games you could digitally download if you wanted to, but that just saved you a trip to GameStop.
Not only were games, outside of MMOs, a one-time cost, but the vast and overwhelming majority of games released were completed. Maybe they haven’t always released high-quality masterpieces of game design, but they worked. They were playable and they largely did what was advertised.
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It wasn’t because it was just the good old days and that was how it was back then, but rather that game developers were still getting used to the ability to patch games whenever they wanted on the internet . For most of gaming history, a game had to be tweaked at launch because there was no way to modify it after release.
Also, gaming was a much, much smaller industry even a decade ago. Lots of people loved the games, and there was money in them, but gigantic publishers weren’t making billions upon billions, forcing them to release lucrative releases every year and fill their games with microtransactions to show growth to shareholders.
All of these factors together have made the game what it once was. Today things are different, but most gamers don’t dislike the concept of microtransactions at first sight. For example, when they were first popularized back in the days of PlayStation 3 and Xbox 360, they weren’t a big deal for almost everyone.
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The games might have a few skins that you can buy, maybe a theme, a soundtrack, and a few other goodies, and that’s it. Moreover, these items would not individually be so expensive. You could buy the lot, even if you were just a kid, and it wouldn’t break the bank.
More importantly, they weren’t constantly being advertised, and there were already plenty of customization options built into the games, so there wasn’t much need for premium offerings like paid skins or other types of cosmetics. If you bought something from the store, you did it as a treat that you could somewhat justify by saying you were supporting the developers of the game you loved.
Everything started to change in the late 2000s with the rise of free and live mobile games. Back in the day, gamers saw the advent of free downloadable apps on your phone with premium stores and largely ignored them, but publishers didn’t.
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You could attract a lot more people if your game was free, and you could make a lot more money than selling your game for a flat fee with microtransactions. Bigger audience, more spending. It was something game companies couldn’t ignore.
So over the years, premium $60 (or now $70) AAA games adopted business models that increasingly resembled free-to-play mobile games without actually lowering their prices or becoming free-to-play. Customization options that were once standard in games have become locked behind paywalls, while rewards and progression have become locked behind battle passes with premium tiers.
As a result, the games reached more and more people and the game companies made more and more money, but the games themselves, in some ways, also suffered. But ultimately the problem isn’t with microtransactions, the problem is that publishers are locking more and more content behind a paywall until the whole experience feels hollow and slimy, like a seller of used cars trying to sell you something.
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Can NFTs improve this mess?
Yes and no is the honest answer. Indeed, NFTs are just a tool like any other technology. They can be used to further separate players from their wallets, or they can add value to digital sales. It is really in their implementation that they will be good or bad for games.
Take huge failures like Ubisoft’s Quartz NFT program or STALKER 2 plans to add NFTs. These are clear examples of NFTs being used as luxury waste of no real value to trick big budget whales into buying them all to flex on others. They’re really just another way to sell microtransactions to players, but with a new coat of paint and under a new name.
Whether you like them or not, however, microtransactions are here to stay, so gamers as a community should try to spend their time advocating for an ethical way of doing business rather than complaining about their existence. Times are changing, and just as Hollywood was inevitably going to move away from black and white, gamers need to realize that flat-rate gaming will never be the status quo again.
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The good news is that NFT technology can improve games, if we let them. Consider some of the biggest issues that have historically plagued the microtransaction business model: First, microtransactions are by definition temporary. They’re tied to a specific game, and if the publisher stops the game, loses its data, or there’s a problem with your account, your purchase is forfeited.
Second, microtransaction purchases do not come with good records, do not retain value, and cannot be resold. Most of the time, the only way to know that you bought something from an in-game store is to see if the item is in your inventory or to check a credit card statement. And anything you buy, unless you’re lucky enough to buy a CS:GO item or something similar, can’t even be returned, let alone resold or traded to another player.
Finally, microtransactions are usually shrouded in secrecy in order to benefit the publisher the most and make them the most money possible, not the developer or the artists who designed a particular thing. Don’t expect to know how many copies of a skin have been sold or where the profits actually go.
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These three key problems can be solved by NFTs. For one thing, NFTs can easily be programmed to work across different games, especially games under the same publishing umbrella. Also, they won’t actually be tied to a specific game, and if a game goes down or the publisher shuts down, you’ll still have your NFT.
Second, NFTs are by definition secure digital records. NFTs also retain value, can be resold and traded. They function like digital items that someone might keep in their real inventory, much like a character in a game stores virtual items in their inventory.
Finally, NFT sales can be tracked openly, and NFTs can be structured such that even when resold, a percentage of the profits will go to the original creator. You can set up NFTs so that a portion of the profits from them go to the artist who designed them or more specifically to the development studio that built the game.
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This may not happen, as publishers tend to be greedy, but it does mean that NFTs can provide many of the usual consumer features in the microtransaction world if publishers choose to implement them ethically. .