Why Crypto Games Will Never Be A Thing
Insights From The Next Generation Of Gamers
During the peak of the crypto bubble, I asked my students who was interested in blockchain gaming. None were. None understood how blockchain worked. I explained how at the time a solidity developer could charge hundreds of thousands of dollars for their work. They didn’t seem to care. If they knew anything about crypto, they thought if it as an investment vehicle at best or at worst a scam.
Perverse Incentives
Whenever you add financial gain into a system, you instantly pervert the incentives of that system, tipping them toward the material. It seems like a no brainer that a gamer would like the awesome gun or skin they purchased to become insanely valuable, too. This way, they can play a fun game and instead of paying for the privilege, get paid. The lure of money would draw in more players to enhance the community, and everyone profits. It’s a win-win-win.
But the in practice, the opposite is true. Players want to play games to escape from real life and experience moments of delight and joy, not to make money. If they really wanted to earn money, they would work or invest, activities that can also be rewarding in their own right. And as appealing as the opportunity to make money is, speculating in a token is also a risk that not everyone wants to take.
To make this a little more concrete, imagine that Microsoft developed a new online shooter that featured an item shop… except the items in the shop have an added benefit: Each one comes with a certain amount stock in Microsoft. And if you sell the game asset, the stocks transfer with it.
This is essentially what adding crypto-speculation into a video game would be. It turns ever asset into a security, an investment vehicle.
Granted, some items in games have already come with massive price tags. But these items become valuable because of their utility. They have no value outside the game. NFTs are unique and immutable, and tradable on exchanges, making them a security in their own right. A share of stock is fungible, but the principle is the same.
If the Super Suit comes with 10 shares of Microsoft stock, it becomes not a game item, but an investment vehicle. And buying it is no longer a game decision, it is a financial decision.
And therefore, Microsoft is no longer developing a game at all, but an investment platform.
And therefore, any design decisions they make must necessarily serve its power to spur investment and speculation, not create a healthy, fun game system. Or if they do make a fun game, it’s a coincidence.
Gamers are extremely sensitive to this. They already have experience watching their game items turn into commodities. Developers frequently use dark patterns to boost revenue and increase in-game transactions. This is almost universally considered a negative to the games’ aesthetics. My students always say this, and when they design they are adamant about not using these mechanisms.
It’s not that they begrudge companies for their money. It’s just that gamers are cognizant, whether they articulate it this way or not, that mechanisms that increase spending, revenue, and value are usually not aligned with the best game experience for players, and this is the perspective they approach gaming from.
An interesting point I think this author makes is when he talks about the incentives of players. He says that players want to escape from the real world, to relax and have fun, not to make money He goes on to explain that is one of the reasons blockchain games are not successful. This is a very important perspective to have when thinking about the gamification of financial literacy. Is the goal of players when they approach any sort of game. Whether a financial literacy game is successful or not would people actually want to play it? Is possible to design a tool/game that can educate but also be attractive to payers who are looking for an escape? With that in mind perhaps a more successful route to gamifying financial literacy would be to create a simulated space vs. one that ties to your real-life finances. I think that what this article gets at, supports that idea.
Liberty, Sam. “Why Crypto Games Will Never Be a Thing.” Medium, Medium, 4 Feb. 2024, sa-liberty.medium.com/why-crypto-games-will-never-be-a-thing-1a7b8b1dad8b.
