Crypto games, also known as blockchain games or tokenized games, are digital assets that you can collect, buy and sell. Generally, they will exist on a central server until they’re bought and sold by players; once this occurs, the game is decentralized and exists on a blockchain.
In this guide, we will explain everything that you need to know about crypto games.
What is a Blockchain?
Blockchains are distributed ledgers that record data across a network of personal computers. It is used to digitize, decentralize, secure, and trade just about anything. Their growing list of real-world uses includes everything from medical records to our digital rights to financial transactions.
What are Cryptocurrencies?
Cryptocurrencies are forms of digital money designed to be secure and anonymous in most cases. They use cryptography – the art of writing or solving codes to track purchases and transfers. While cryptocurrencies exist independently from banks or governments, they’re still regulated by the laws of math, which makes it nearly impossible for hackers or anyone else to manipulate cryptocurrency transactions.
This specific characteristic makes them superior to regular currencies because no one can seize or freeze accounts, and the threat of hyperinflation is eliminated.
Cryptocurrencies are categorized into coins, utility tokens, and security tokens. Coins like bitcoin and Litecoin give you access to a network – meaning that it acts as its payment system. Tokens such as Ethereum’s Ether let you play by different rules – for example, making payments in multiple currencies or creating your cryptocurrency. Then the security tokens like Polymath (POLY) permit investors to trade cryptocurrencies representing shares of stock in a company.
What are NFTs?
NFTs are Non-Fungible Tokens, meaning they are unique in some way. Their degree of uniqueness is guaranteed by the Ethereum blockchain, which acts as a third-party arbiter that can verify that one person only owns each NFT at a time. This means NFTs cannot be replicated or destroyed, making them valuable digital assets to own.
Crypto games are a new type of game where players collect and trade digital assets; they’re also known as crypto-collectibles. Most commonly, these crypto-collectibles take the form of online avatars, but other types have been created, such as music records, art pieces, and event tickets. These items are usually cryptocurrency tokens on an open financial network
How are Crypto Games Different?
There are five significant differences between regular games and blockchain games.
- Blockchain games hold their in-game assets on the blockchain rather than on central servers.
- Blockchain games have their own tokens.
- You can trade blockchain game assets peer-to-peer or on centralized marketplaces like OpenSea and Rare Bits
- In some cases, blockchain games allow users to mint new in-game items instead of trading existing ones.
- Blockchain games support automation because they’re programmable; this means everything from robots to smart contracts exists at the player’s discretion.
Why Play Crypto Games?
There are three reasons why gamers might be interested in playing blockchain games: collecting, socializing, and inventing.
- As a collector, you’ll be able to buy and sell assets as well as lend your items to others interested in collecting.
- As a socializer, blockchain games offer new ways to interact with other players.
- Blockchain games can also be educational because they give you a way to create and invent your own content – whether that’s a new video game or a brand-new cryptocurrency.
If you’re curious about the world of cryptocurrencies but don’t know where to start, playing blockchain games is one of the best ways to learn. You’ll experience their capabilities firsthand by spending money, trading assets, and creating automated processes using smart contracts. In time, this knowledge will allow you to make informed decisions when it comes time for you to invest in cryptocurrencies and other resources related to blockchain technology
Blockchain and Gaming
Blockchain technology brings with it many benefits for gamers. In the case of Crypto Games, it brings true ownership, provably fair gameplay, and high-speed transactions. It also introduces a new revenue model for developers who could earn up to 95% more than the traditional model.
What Do Decentralized Games Look Like?
Decentralized games will vary greatly depending on the smart contract technology powering them. Some use non-fungible tokens (ERC-721) where each asset created is unique, and players can buy, sell and trade these assets freely on third-party marketplaces.
Other games might use fungible tokens (ERC-20), which are interchangeable with other instances of that same token – think about buying 1000 Gold in World of Warcraft vs. 1000 Gold in Diablo 3; they’re fungible as both are the same thing.
What Do Decentralized Games Mean For Developers?
The technology behind decentralized games gives players ownership of their digital assets; those who purchase a tokenized asset will be its sole owner and can store it however they like (in wallets, on exchanges, etc.)
This allows gamers to buy, sell and trade freely without any fear of being banned or their assets being taken away from them. Furthermore, because blockchain assets are easy to see and track, developers may also implement ways for users to interact with these items in-game. For example, a player could shoot a missile that causes another player’s tokenized spaceship to explode – all powered by code running on blockchain technology.
This new revenue model allows developers to give players more freedom and make them feel like true owners of the game they’re playing; for example, there could be a massive boss battle in a role-playing game where the victor gets all the spoils (tokens, items, etc.).
This would result in an epic feeling as the winner truly earned everything they got. From a financial standpoint, it also means that gamers can help sustain and grow these games as they’re now able to buy, sell and trade their assets freely – resulting in increased player retention.
Advantages of Crypto Games
A decentralized game levels the playing field for everyone – anyone can spend the time and effort required to earn all-digital assets in a game without fear of losing everything they worked hard to obtain. Furthermore, it’s difficult (if not impossible) to scam people when tokens exist on a public blockchain, and smart contracts ensure that an owner of an item can’t be changed or altered after it has been created.
Another advantage of the decentralized game is that it allows developers to give their players more freedom, and this is because having ownership of the game’s assets removes all restrictions. As a result, you have community-driven games where players are responsible for its upkeep.
This will result in an ongoing revenue stream for gamers who could earn money by creating new items or quests for other users, finding bugs or glitches in a game that can then be reported and fixed.
Disadvantages of Crypto Games
However, decentralized games do have their setbacks. The most notable is the speed of transactions as blockchains cannot process transactions as quickly as a traditional central server.
In addition to this, they may also require users to pay transaction fees every time an item is traded or sold – although if that’s the case, developers could quickly build in functionality, so the buyer and seller pay for these costs.