Will We See More Games Adopting NFTs and Crypto in 2024?

The integration of crypto and NFTs into video games has been a major trend in recent years. As we enter 2024, here is an in-depth look at whether we can expect to see more games adopting these new technologies.

The Current State of Crypto and NFTs in Games

The use of cryptocurrencies and NFTs (non-fungible tokens) in video games took off in 2021. Some major examples include:

• Axie Infinity – A blockchain-based game that allows players to earn cryptocurrency through gameplay and NFT trading. It became extremely popular in 2021.

• Ubisoft Quartz – Ubisoft launched their own NFT platform for their games in 2021, starting with Ghost Recon Breakpoint.

• Sorare – A soccer/football fantasy game using NFT player cards that can be traded and sold.

So far, big player-earners have come from play-to-earn games like Axie Infinity. However, major publishers like Ubisoft and Square Enix are also beginning to adopt NFTs.

Why Are Crypto and NFTs Being Added to Games?

There are a few key motivations behind adding blockchain technologies to games:

• New monetization models – NFTs and crypto can allow new ways to monetize games, like selling virtual items/assets.

• Digital ownership – Blockchain verifies ownership of rare digital assets, taking away centralized control from the developer.

• Interoperability – Assets like NFTs can theoretically be used across different games/metaverses.

• Play-to-earn model – Games like Axie Infinity directly pay players for gameplay with crypto. This is attractive in developing nations.

The Case for Increased Adoption of Crypto/NFTs in Games

Here are some of the biggest factors that point towards crypto and NFT integration increasing:

• Mainstream attention – The massive success of games like Axie Infinity has put NFT gaming into the mainstream.

• Big publisher interest – Major players like Ubisoft, Square Enix, and Sega are starting to support NFTs.

• Investor interest – Venture capital investment into crypto gaming startups has surged over 1000% from 2020 to 2021.

• Play-to-earn appeal – The play-to-earn model has strong appeal, especially in developing countries where it can provide income.

• Templated blockchain platforms – New platforms like Enjin make it easy for existing games to add NFT/blockchain features.

Concerns About Crypto and NFT Integration

However, there are also some significant barriers and risks to wider adoption:

• Player backlash – Some players perceive NFT integration as a cash grab and resent the change. For example, GSC Game World saw significant backlash after announcing NFT plans.

• Unproven model – It’s still uncertain how successful play-to-earn and NFT models are long-term outside of a few breakout hits.

• Environmental impact – Proof-of-work blockchains like Ethereum have raised concerns over high energy usage.

• Legal uncertainty – The legal status of earning income from play-to-earn gaming is complex. Issues like gambling regulations come into play.

• Crypto volatility – Major swings in cryptocurrency prices add financial instability to games with crypto/NFT integration.

Key Factors to Monitor

As we move into 2024, here are some of the key trends and developments that will determine if crypto/NFT adoption expands:

• Adoption by major franchises – If flagship titles like Call of Duty or FIFA add NFT/crypto features, it will signal wider acceptance.

• Regulation clarity – If laws around crypto gaming ownership and income become clearer, it could encourage adoption.

• Environmentally sustainable platforms – The growth of proof-of-stake crypto platforms like Tezos that require less energy.

• Platform growth – The success of new crypto/NFT gaming platforms like Gala Games will show developer appetite.

• Broader crypto adoption – If cryptocurrencies become more mainstream, adoption in gaming will likely follow.

Conclusion

Based on the powerful incentives around new revenue models and digital asset ownership, I expect adoption of crypto and NFT features in games to continue growing in 2024. However, the extent of growth depends on overcoming backlash, unproven sustainability, and regulatory uncertainty. Major franchises adding support could be a pivotal tipping point towards mainstream integration. But ultimately, sustainable platforms that balance innovation with tangible benefits for players are most likely to drive steady long-term adoption.