Games have been played well before electricity existed. However, with the advancements in technology that electricity ushered in, games were changed forever. This new technology, blockchain, builds on the evolution of gaming, but you may be thinking, why should we be putting games on the blockchain? In this article, we want to explain how NFT gaming revolutionizes the game industry like never before.

Hopefully before you started this, you read my blog "What is an NFT?" If you missed it, here is a quick explanation: NFTs are unique digital assets that live on the blockchain. They can be proven mathematically to show both ownership and originality. 

This is critical to understand as we look at NFT Gaming. The two key elements here are ownership and originality. If you think of any “normal” game you play today, it is unlikely you have either. What do I mean?

First of all, let’s agree that every game purchase starts the same; you, the gamer, are on a mission to try to find the best entertainment for your buck. This usually looks something like buying a game, playing X number of hours, and then justifying the purchase as, “That game only cost me $0.12/hr since they played it so much.” If you play free-to-play games, you are exchanging your cost to play for advertisements and marketing schemes. The odds are you’ll buy something eventually; you just aren’t there yet. 

NFT gaming turns this model on its head. In fact, it creates in-game mechanics that have a real-world impact. For example, let’s take a look at CryptoKitties, the first simple NFT game to reach popular acclaim. Yes, it is a game of cartoon cats.

The game mechanic was extremely simple; you have a unique type of cat with a variety of traits. You can breed your cat with another cat, which has its own unique traits, and you get a new cat, hopefully with the best of both parents. Since each of these cats is an NFT, they are unique digital assets that can be sold. This means you would breed two cats, sell the baby cat, and repeat. 

Why would people want to buy the cats though? Great question. This is where the game meets real-world game theory and economics. In this scenario, as more cat owners create new cats, they are incentivized to sell their unwanted cats to cash out on the time put into the game. This creates an available market as cats spread the word. When new players hear they can play a game and make money doing so, they must first buy these CryptoKitties from the free market. Thus the cycle continues until no one wants to buy any more cats, and the price of cats falls to the point it no longer is advantageous to continue putting time into the game.

While there is a lot more to dissect about CryptoKitties, it highlights a core principle in gaming that you might not have thought about: Ownership. Try to sell a game from your digital game library and see how that goes, or better yet, try to sell a skin from your free-to-play game. If you can not sell it, you never really owned it. The game developers giveth, and the game developers taketh away. Seriously, at any point, those who own the game could delete all your in-game items just because they woke up on the wrong side of the bed.  

NFT gaming fundamentally changes this model, and the second wave of NFT gaming is already among us. Games like Axie Infinity, that not only have in-game items and characters that are unique NFTs, but also include their own native tokens or cryptocurrencies. These tokens act as in-game currency to use for actions within gameplay or to sell to other players for cash. Think of this like collecting points in-game, but now you can turn all or some of your points into higher-level items, skins, or even real-world money via crypto exchanges. 

While earning tokens and cashing out to dollars might seem like magic internet money, remember there is a reason you are receiving this value. When building NFT games that include native tokens, the game developer creates incentives to earn those tokens. The cycle goes something like this: the incentives increase the number of gameplay hours you spend in-game, which increases the popularity of the game, which brings new players into the game, which brings new money into the game via the sale of assets. If you are helping to bring new players into a video game, you should absolutely be rewarded for that referral! In fact, it makes the “normal” game development companies look greedy for not paying you when you tell your friends to join a game.

This revolution has created brand new business models like the one we adopted at Duo while building our NFT card game. The game has two types of cards, Black and Color Cards. The Black Cards have funny fill-in-the-blank phrases, and the Color Cards have hilarious punchlines of different humor types. The goal is to create the funniest jokes on the blockchain in a simple and fun game to play with friends or strangers. While the game is still in pre-alpha development, we have started selling our first deck of NFT cards. Where our business model differs from traditional game companies is that we believe the majority of all future cards created should come from the existing players. We are using an in-game mechanic to unlock new packs of cards, and the players who unlock these packs can sell them into the market and make money on them, instead of us the game developers making the money. 

This new approach to creating a game allows your players to receive the majority of the value for growing the community. Blockchain technology enables us to create long-term value and incentives that can only be achieved through NFT gaming. 

Even though we barely scratched the surface of NFT gaming, there are a couple of takeaways you should leave with. First, ownership of game assets is finally here. As a player, NFT games enable you to own and sell your items, characters, and everything in between. Finally, earning points or tokens in these NFT games can be traded on crypto exchanges which means you can play-to-earn and cash out tokens you don’t need. 

All of our moms thought we were crazy when we said we could make money playing video games. This used to be true; very few players made it to the eSports circuit or were successful as streamers. However, we finally have the technology, via blockchain-enabled NFT gaming, that can help us show mom just how crazy we are.

This article was written for Stocktwits.com. Read the original article here.