How Digital Assets Can Benefit The Video Gaming Industry

When it comes to the gaming industry, digital assets have the potential to unlock and provide value in a wide array of unique ways. Unlike other industries, digital assets have been a concept within the gaming industry long before the creation of the ERC-721 standard in 2017. In fact, digital assets have been a fundamental aspect of the gaming industry for decades, and up until recently, there’s been no way to verifiable own, transfer, and trade these assets. The decentralization of in-game assets has the potential to have a huge impact on the gaming industry, with a few benefits being the strengthening of in-game economies, player engagement, and the promotion of content creation.

In-Game Economies

The use of digital assets within video games can strengthen both new and existing in-game economies. When in-game items such as skins or digital items are issued in the form of digital assets, it allows for players to gain more value out of the game. Digital assets allow for in-game items to be bought, sold, and traded, and thanks to the decentralized blockchain technology that helps power digital assets, these items wouldn’t be tied to a specific company, server, or game. When a player is done with a specific game, they would have the option of selling their items on a secondary market, effectively allowing the player to recoup monetary value which would vary depending on how much time they’ve invested into the game. The creation of a secondary market would also benefit the brand behind the game, as the company would be able to facilitate the creation of this dedicated secondary market and would even be able to charge a fee on all transactions made within it. When digital assets are introduced to video games, it makes games for equitable. For the first time ever, gamers are now able to be rewarded with things of genuine value for all of their in-game contributions, whether it be an investment of time or money. As it stands right now, when someone is done playing a certain video game, they lose all of the value that they’ve invested into this game as soon as they decide to put down the controller. All in-game purchases, items, and rare unlockables stay with the game, and there’s no “off-ramp” for the former player. Digital assets, and the blockchain technology that powers them, have the potential to change this.

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Player Engagement

Digital assets within video games can also improve player engagement. When players are granted the ability to sell, transfer, and own in-game items, it provides them with a greater incentive to play. The use of digital assets may also catalyze player retention, as even if someone decides to stop playing the game, they may choose to sell or transfer their items to another individual, which may increase or at the very least be a net neutral for the player base of any specific game. Digital assets are a multi-faceted technology and can be used within video games in a variety of ways. They may also allow players to bring real world items into the game or vice versa. In the past year, “phygital” fashion has seen a rapid rise in popularity, which in simple terms, is an approach to fashion that combines digital and physical elements. Brands, such as RTFKT, now allow people to own digital items that can be worn in the real-world while others are working on allowing real-world items to be used in virtual environments (such as video games) through the use of digital assets. If a “phygital” approach were to be taken with in-game items such as skins or digital clothing, it would allow for players to have a more personalized gaming experience. For the company, it would also create opportunities for brand deals and other partnerships. The idea of taking a “phygital” approach isn’t completely foreign to the gaming industry, with games such as Fortnite partnering with brands like Balenciaga and Ralph Lauren to offer “physical-to-digital” products for players. However, games such as Fortnite have previously taken a closed and centralized approach to phygital items, and the industry has yet to see a brand that combines blockchain-backed, decentralized digital assets with in-game items.

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Content Creation

The use of digital assets within video games also has the potential to catalyze content creation. For example, games could allow players to create and generate their own in-game digital assets. The creation of community-generated skins, items, buildings, and other things would be a form of content, which would ultimately be shared not only within the game but on external platforms as well. The concept of user-created items is quite common within the gaming industry, but it hasn’t really been done with the utilization of digital assets and blockchain technology. For the first time ever, players would now be able to create in-game items that they can truly own, which includes the ability to transfer, sell, and store these assets or items. Companies could also generate revenue by charging a fee for each asset or item created. When player generated content is combined with digital assets in video games, it almost makes for a digital “build-a-bear” type experience, one in which players can create items that they can actually have true, autonomous ownership over. These items may also hold monetary value, as most digital assets can be bought and sold on a secondary market. The idea of being able to create an in-game piece of content that may hold or generate monetary value would incentivize creators to participate in the game itself. This, in turn, would also promote community-building and would strengthen any existing communities that the game may have.

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Digital assets have the potential to revolutionize the “traditional” gaming experience. For as long as the industry has existed, video games have provided players with a way to augment reality. Video games thrive on creative immersive environments and worlds, and the addition of digital assets makes these environments even more realistic and tactile. Just like when the ability to move freely within an open map or world was introduced to gamers, the ability to digitally own in-game items will help the gaming industry enter a new era and improve the gaming experience for all.