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Crypto Gaming - Its Strengths and Weaknesses

Crypto Gaming - Its Strengths and Weaknesses

Auther: Aniedi Utah

Crypto Gaming - Its Strengths and Weaknesses. Crypto or blockchain gaming may seem a novel idea for many people but this concept has been in use for some time now. In fact, the first crypto-themed game CryptoKitties launched seven years ago in 2017 on the Ethereum blockchain. In the years that have passed, others like Axie Infinity and StepN have stolen the spotlights from CryptoKitties but their popularity has also been temporary.

The throne for crypto’s most engaging game is still open and the million-dollar question is what project will take the crown? 2024 has a lot of crypto narratives to unpack and crypto gaming should not be left out.

Crypto Gaming - Its Strengths and Weaknesses

Is There Anything to Crypto Gaming?

Crypto gaming to many seems like another nerdy term coined by computer geeks who spend all day on the internet. However, it is a breathing and fast-growing market landscape. According to a market report, the blockchain or crypto gaming landscape boasted a revenue in excess of $4.2 billion in 2022 and is on course to hit $65.7 billion in 2027 while recording a compound annual growth rate (CAGR) of 70.3%. The industry is fast becoming a place where both traditional game makers and investment companies are paying close attention to. But what exactly is crypto gaming?

Crypto gaming is a term that captures a blend of traditional gaming experiences with the integration of cryptocurrencies. Just like the name sounds, gamers are able to play the games they love while relying on digital assets for utilities and other in-game experiences. Crypto games are powered by what is called blockchain technology which is an immutable distributed ledger system that captures transactions in a transparent and publicly verifiable manner. Blockchain technology is now the toast of the world as it offers direct access from producer to users while cutting out middlemen or intermediaries in the process.

Gaming in the traditional sense has come a long way from consoles to e-sports. However, users are often locked within the game’s ecosystem. This means, users’ coins, gems, gold, and other in-game utilities are only accessible when they play a particular game. These items cannot be moved or migrated to another similar or dissimilar game. Crypto gaming changes all these all thanks to smart contracts and innovative token standards like the ERC-721 that powers non-fungible tokens (NFTs).

With crypto games, users get to customize their gaming experiences, trade in-game items like skins, characters, gears, earn virtual assets, and cash out these in-game assets for regular fiat. The best thing about crypto gaming is that users can and often migrate their in-game utilities from one platform to another thereby enriching their entire gaming experience. This shows that crypto gaming offers a no-doors-barred scenario for gamers.

That’s not all the benefits tied to this new form of gaming. Crypto gaming introduces uniqueness through digital assets like NFTs. Unlike virtual assets like Bitcoin or Ethereum, NFTs are distinct and non-exchangeable on a one-to-one basis due to their unique traits. Each NFT comes with specific characteristics that cannot be found or replicated on another. This means 1 NFT cannot be easily swapped for another unlike 1 BTC being exchanged for another. This rarity gives NFTs real-world value with some selling for millions of dollars a pop.

Another key benefit of crypto gaming is their decentralized ethos. Reliant on blockchain technology, the entire gaming experience is not controlled by any singular entity or government authority. The crypto gaming ecosystem is often separated from a central authority, offering gamers the opportunity to flesh out their journey without fear of sanction or ban. The absence of a central authority also means whatever updates or changes need to be done to the game is voted on by a large number of people as against the top echelons in an organization, prompting democratization.

Hiccups Along the Way

Crypto gaming is gradually catching on thanks to pioneers like Bitcoin and Ethereum. Although these two are fungible assets, their strong brand awareness and industry influence have forced many to pay attention to the GameFi (gaming and finance) narrative offered by the nascent crypto landscape.

However, crypto gaming is still a long way from mainstream adoption. For one, the limited awareness around blockchain technology. Blockchain tech is one of the most intriguing concepts beside AI. However, the tech is quite technical, and many end-users are still in the dark on how it actually works. A growing number of blockchain-themed platforms are working on simplifying the on-boarding processes for everyone. Nonetheless, the journey is still far and the industry is still in its infantile stages.

Another challenge currently faced by the crypto gaming landscape is regulatory challenges. 

A growing number of world governments are coming on hard on crypto assets and blockchain-themed services. Some in Asia have outrightly banned cryptocurrencies while others have imposed huge taxes on incomes earned from interacting with crypto games. This issue can further impact the growth trajectory of the crypto gaming landscape.

The final challenge is that a large number of games depend on the Ethereum blockchain due to its native support for smart contracts and NFTs. Although Bitcoin continues to dominate the crypto market, the oldest distributed protocol lacks composability and is not programmable for new feature additions. This makes it a one-themed network where permissionless value transfer can be executed.

Crypto Gaming - Its Strengths and Weaknesses

(CryptoKitties - Crypto Gaming on Ethereum)

Ethereum on the other end, is more flexible and played hosts to crypto game hall of famers like CryptoKitties, Axie Infinity, and several others. But it comes with its own issues. It is often slow and comes with high gas (transaction) fees during peak gaming sessions. This often impacts the gaming experience while costing users a chunk in crypto assets. Ethereum-based projects also depend on the Ether token, which in itself, is pricey with 1 ETH going for as much as $3,000 in current market valuation. So while it might be the default leader, a growing number of alternative platforms are closing the crypto gaming gap.

Crypto Gaming - Its Strengths and Weaknesses

(Cornucopias - Crypto Gaming on Cardano)

Cardano Gaming Ecosystem IS Growing!

In the last couple of years, flexible blockchain infrastructures have been developed to counter the slow throughput and high cost of older protocols like Bitcoin and Ethereum. One such is the third-generation peer-reviewed Cardano blockchain. Reliant on the innovative Ouroboros proof-of-stake (PoS) consensus mechanism, the Cardano blockchain offers the trio of decentralization, scalability, and security all in one package.

Crypto Gaming - Its Strengths and Weaknesses

(Chains Of Was - Crypto Gaming on Cardano)

(Cardania - Crypto Gaming on Cardano)

Crypto Gaming - Its Strengths and Weaknesses

(Gold Mine Arcade / Digital Gold Ecosystem - Crypto Gaming on Cardano)

( - Crypto Gaming on Cardano)

In reference to our discussion, a growing number of crypto games have since deployed on the Cardano blockchain. Currently, there are over 56 crypto games operating on Cardano network spanning different categories like action, adventure, MMORPG, arcade, AR, and several others. The network’s 100% up time and low cost have also played a crucial role in its growing attraction for game developers as crypto gaming continues to make its way into everyday lifestyles.


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