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What Does NFT Mean In Gaming?

What Does NFT Mean In Gaming?

The Non-Fungible Token (NFT) industry can be traced back to the early days of the internet. The first NFTs were digital collectibles created on forums and message boards. These tokens were simply images or text used to represent a unique asset.

However, it wasn't until the development of blockchain technology that NFTs really began to take off. Blockchain provided a way to securely and permanently store data on a decentralized ledger. This made NFTs much more secure and trustworthy than traditional digital collectibles.

Since then, the NFT industry has exploded in popularity. Millions of dollars worth of NFTs have been sold, and the market is only getting bigger. With the help of blockchain, the NFT industry is revolutionizing the way we think about digital ownership.

This article discusses NFTs, including where they came from, important milestones, and what to expect in the future.

The Origin of NFTs

The first-ever known non-fungible token (NFT) was created in 2014 by Kevin McCoy and Anil Dash. It was called Quantum and consisted of a video clip of digital art created by McCoy’s wife, Jennifer. Originally, the technology was called “monetized graphics,” and Quantum was registered on the Namecoin blockchain and sold to Dash for $4. Today, it’s on sale for $7M.

In October of 2015, three months after the launch of the Ethereum blockchain, the first NFT project, Ehteria, was launched and demonstrated at DEVCON 1 in London. Most of the 457 NFTs went unsold for more than five years until March 13, 2021, as interest in NFTs was renewed. These remaining pieces sold out in 24 hours for a total of $1.4M. At the time of their launch in 2015, their cost was only $0.43 each.

Increased public awareness began in 2017 when an online game CryptoKitties monetized cat NFTs. During 2020, the value of the NFT market exploded, tripling to $250M. During the first quarter of 2021, more than $200M was spent on NFTs.

Or Was the Origin in 2012?

There is another origin story out there on NFTs worth discussing, known as Colored Coins. Colored Coins, created in 2012-2013, are made of small bitcoin denominations–known as a single satoshi–which can be used to represent a multitude of assets and have multiple uses, including:

  • Coupons
  • Property
  • Issue shares of a company
  • Ability to issue your own cryptocurrency
  • Digital collectibles
  • Access tokens

Unfortunately, the whole Colored Coin system carries several flaws. But, they played a significant role in laying the groundwork for NFTs. You can learn more about them here in the “Overview of Colored Coins.” 

Counterpoint: “Counterparty”

Another early consideration for the creation of NFTs is Counterparty. Counterparty is a peer-to-peer financial platform and distributed, open-source Internet protocol built on top of the Bitcoin blockchain. It allowed asset creation and even included a trading card game and meme trading, where Rare Pepes originated.

Rare Pepes

In October 2016, “rare pepes” were issued along the Counterparty platform. A rare pepe is a meme featuring a frog character that has developed an intense fanbase. Besides being incredibly quirky, the uniqueness of these images makes them such desirable NFTs. 

How the NFT space has evolved

In simple terms, an NFT is a unit of data stored on a variety of digital ledgers called a blockchain, which can be sold and traded. But, what started as a simple video clip has evolved into many use cases across various industries. But, perhaps none is more compelling than the art industry.

The History of NFT Art

Art is perhaps the most common way to use NFTs, as auctions from high-profile NFTs have made the biggest splash in public attention. Currently, the most expensive NFT ever sold was at an auction price of $91.8M–work by artist Pak, entitled The Merge.

The merge

The Merge is both a single piece of artwork and a series of artworks. When it launched, buyers could purchase an NFT, called a mass, for a set amount of money ($575). However, for buyers who purchased more than one mass, instead of receiving another NFT, their current mass actually increased in size. The price of a mass NFT grew throughout the sale, and buyers who bought a lot of mass were rewarded with free mass. 

It sounds a little confusing, but if you can picture a tiny ball of mercury as one mass, then add other tiny balls of mercury to it, you can see how each comes together to get bigger and bigger. That’s what The Merge is and was before the sale was brought to a close. Now, even though the launch is over, buyers and traders can still sell or trade their NFTs to grow their mass bigger, making their NFT more valuable. 

In the end, more than 28,000 buyers spent over $91M on what has been one of the most compelling NFT art concepts to date.

Everydays: The first 5000 days

The second most expensive (at $69M) was a piece of artwork by Michael Winkelmann–known as Beeple–called Everydays: the First 5000 Days.

Beeple is a graphic designer and motion artist from South Carolina who is well-renowned in the digital art world. However, his rise to fame reached a new height with his NFT collage created from 5,000 images created daily for 13 years. The images were put together and formed one NFT unit that sold for almost $70M making it the third-most-expensive piece of art ever sold.

CryptoPunks

Perhaps, the most well-known NFT digital art pieces are the collection of CryptoPunks, which is credited with starting the NFT craze of 2021.  

CryptoPunks is a series of 10,000 unique collectible characters stored on the Ethereum blockchain. Each character is created using an algorithm and no two are identical. The images are 24x24 pixels and feature some combination of guys, girls, apes, zombies, and aliens. While some of the images share attributes, the rarest ones feature the fewest attributes. For example, on the current marketplace, CryptoPunk 5822 is on sale by the owner for $34.89M. It features one attribute–a bandana–which is only shared by 481 punks. 

Perhaps the wildest part of CryptoPunks is that initially, they were all free. One simply had to claim them. Now they sell for hundreds of thousands to multi-millions of dollars.

CryptoKitties

In the 90s, we had Tomagotchi–a handheld digital pet that you could feed, love, and–if neglected–kill. In the 2020s, we have CryptoKitties! CryptoKitties are digitally created breedable and collectible cats. Each is one-of-a-kind and cannot be replicated, taken away, or destroyed.

It turns out that breeding digital pets is big business for at least a short period of time. While CryptoKitties was the first widely recognized blockchain game and featured astronomical growth, the popularity was short-lived. In fact, it reached its peak on December 10th, 2017. But, by the beginning of 2018, the game’s popularity fell by 90% of users. However, for those that were fortunate during that short time. One CryptoKitty fetched $1.3M, another $566,000, and the third most expensive CryptoKitty was sold for $107,000.

Bored Ape Yatch Club

Similar to CryptoPunks, Bored Ape Yacht Club (BAYC) is a collection of 10,000 unique, algorithm-created images. Except instead of aliens, zombies, and humans, BAYC features images of–you guessed it–apes. In March of 2022, sales of BAYC made up more than a third of total NFT sales. In January of 2022, BAYC surpassed $1B in total sales.

Who Can Create & Purchase NFTs?

The easy answer is that anyone can create or purchase NFTs. Some companies help guide you through the process of creation, connecting your content through blockchain, and getting the proper paperwork done to develop your own NFTs. Purchasing is also as easy as connecting with an online marketplace and working with vendors to purchase or acquire the NFTs you want.

You can launch your NFT collection in seconds with Mantial. We assist everyone, from entrepreneurs to celebrities and large companies throughout the whole process of conception, sales, and management of NFT collections.

In Conclusion

The future is wide-open for the NFT industry. As it becomes more and more popular, creators and even NFT experts are still exploring the possibilities of this technology and how it collides with our everyday lives. While the exact future of NFTs is uncertain, the market is expected to continue growing, and NFTs worth millions of dollars today could be worth billions in the future. 

And, when money like that is involved, everyone will want a piece of the action.

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Rick’s NFT

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Michonne’s NFT

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Let's analyze what we can expect from NFTs in the gaming industry now and in the future.

Can NFT gaming add value to gameplay?

The gaming industry is already very comfortable with virtual assets. In-game items have been a part of video games for decades, and their popularity has only grown in recent years. The rise of free-to-play games and "loot box" mechanics have driven an increase in spending on in-game items, with some players spending hundreds or even thousands of dollars on virtual goods.

NFTs are a natural extension of this trend, as they provide a way to create unique, digital assets that players can use in games. NFTs open up a whole new world of possibilities for game designers and developers, who can now create games with persistent, digital items that players can own and trade.

NFTs also have the potential to change the way we think about game economies. Players can trade in-game items backed by NFTs on secondary markets, creating a whole new economy around games. This would allow players to directly benefit from the value they create in games and could lead to the development of new business models for games.

In-game items and NFTs

One of the most obvious applications of NFTs in games is the ability to turn in-game items into unique tokens. That could have several benefits for both players and developers. For example, players could trade their in-game items on secondary markets or even sell them directly to other players. It would create a new economy around games and allow players to reap the rewards of their 'grinding' in a more immersive way.

Developers, on the other hand, could use NFTs to create unique items that can be sold in-game stores. NFTs would give developers a way to monetize their games directly and could lead to the development of new business models for games.

NFTs could also be used to create "skins" or cosmetic items for games. These items would be purely cosmetic and would not impact gameplay, but could be traded on secondary markets. 

And, of course, it would allow players to show off their unique items and might create a new market for cosmetic items.

Examples of NFTs in gaming

One of the first examples of an NFT in gaming is the "CryptoKitty." CryptoKitties are digital cats that are stored on the Ethereum blockchain. Each CryptoKitty is unique and can be bred with other CryptoKitties to create new, unique kitties. CryptoKitties were extremely popular when they launched in 2017 and inspired a whole new category of games called "crypto-collectibles."

Since then, a number of other games have followed suit and started using NFTs to create digital items. For example, the game Decentraland uses NFTs to create digital land parcels that players can own and trade. You can also buy anything from usernames to avatars in Decentraland.

As a metaverse built on the Ethereum blockchain, Decentraland is one of the most ambitious projects in the space and is a clear example of how NFTs can be used to create new gaming experiences.

In Game Items NFTs CryptoKitties

What are play-to-earn NFT games?

One of the most exciting applications of NFTs in gaming is the ability to create "play-to-earn" games. In a play-to-earn game, players can earn real money by completing tasks in-game or leveling up their characters. This is in contrast to "pay-to-play" games, where players must pay real money to access content or make progress in the game.

The rise of play-to-earn games could benefit both players and developers. For example, play-to-earn games could allow players to monetize their time and effort for sweet fiat money. P2E games could also allow developers to tap into the growing market of "time-rich" gamers. 

Time-rich gamers are people who have the disposable income to spend on gaming but don't have the time to commit to traditional, pay-to-play games. These games could be a perfect fit for this market and could lead to the development of new, innovative experiences.

Examples of P2E Games

One of the most popular play-to-earn games is Block Monsters, which is a digital collectible game similar to CryptoKitties. In Block Monsters, players can catch, breed, and trade digital monsters (Blockmons.) You can then use these monsters in battles to earn rewards. The game also has an in-game store where players can buy and sell items.

Another popular play-to-earn game is Gods Unchained, a collectible card game built on the Ethereum blockchain. In Gods Unchained, players can buy, sell, and trade digital cards. The game also features competitive tournaments where players can win prizes.

What's more, a number of traditional games are also starting to experiment with play-to-earn mechanics. For example, the popular online game Fortnite now allows players to buy, sell, and trade in-game items using the game's virtual currency, V-Bucks. 

NFT Games influence in Metaverse

As cryptocurrencies and blockchain continue to grow, another player does the same in parallel. The VR and Metaverse industries are developing quickly, with new projects emerging every day. One of the main problems they face is interoperability and digital identity.

Digital identity is the need to identify oneself online to access services or content. Many decentralized applications (dApps) will require some form of digital identity in order to function, usually a crypto wallet like Metamask.

However, there is no one-size-fits-all solution for digital identity. Each platform has its own way of handling digital identity, making it difficult for users to switch between platforms.

This is where NFTs come in. NFTs can be a universal form of digital identity that can work across different platforms. For example, your avatar in Decentraland could be your digital identity in the metaverse. This would allow you to easily switch between platforms and still access the same content and services.

Digital identity is a critical use case for NFTs and is likely to become more common as the VR and Metaverse industries continue to grow.

VR Metaverse NFT

Give Power to the Players

Another new trend in blockchain technology is the DAO or decentralized autonomous organization. A DAO is a decentralized organization that is run by a set of smart contracts on a compatible blockchain.

DAOs give power back to the players by letting them vote on and manage the game's development. This new model of game development could lead to some very different and innovative games being created.

An example of this concept would be a game where the players can vote on in-game content, such as story development, game features, maps, etc. This would give the players a lot of power and control over the game's development and would likely lead to some very different games being created.

Ownership

NFTs could also be used to give players ownership of in-game assets. For example, a player could own their avatar, house, or sword. It offers players much more control over their game experience and would likely lead to some very different gameplay experiences.

We can expect to see people get much more attached to their in-game items and avatars as they start to own them. That could lead to very different social dynamics within games and could significantly impact how we interact with our favorite games.

DAOs are still in their early stages of development, but they hold a lot of promise for the future of gaming. We can expect to see more games experiment with this concept in the future, and it will be interesting to see how it unfolds.

Real-World Perks

Another major advantage of NFTs is that companies can use them to give players real-world benefits. For example, players could use their NFT to get discounts on real-world products or services.

It is already happening with the popular online game Hockey Heroes, where NFT holders have perks like free tickets to an official NHL match. In other words, NFTs can be used to give players real-world benefits that are not available to non-NFT holders.

Physical goods can also be stored on the blockchain and given to NFT holders. For example, a sports game like FIFA could offer exclusive physical merchandise to NFT holders. This merch can include anything from t-shirts to autographed cleats.

Similarly, NFTs could also give players access to exclusive content or experiences. For example, an NFT could double as entry admission to a VIP event, seminar, or concert.

Crowdfunding For Indies

Finally, NFTs could be used to help fund the next generation of independent game development. For example, a game developer could create an NFT representing a share of the game's development.

With nothing but an idea and visual prototype, the developer could start selling these NFT shares to raise money for their project. If the project is successful, the NFT holders will make a profit.

This crowdfunding model could help many indie developers get their projects off the ground and give them a chance to compete with the big-budget AAA titles. Platforms like Gamestarter are already experimenting with this concept, and it will be interesting to see how it develops in the future.

New Work Opportunities

With the metaverse and the rise of NFTs, we can expect to see a lot of new work opportunities emerge. There are actually already a few platforms that are starting to experiment with this concept.

For example, the popular online game Second Life has been around for over a decade, and it now has its own virtual economy. Players can spend hours working in-game to earn Linden Dollars, which can be used to buy virtual goods or services.

With NFTs, players could be paid in cryptocurrency for their in-game work. This would open up a whole new world of opportunities for people who want to make a living in the virtual world. In this case, the NFT would constitute the employee's identification and work record.

We can also expect to see a lot of new opportunities for content creators. Freelancers especially could find a lot of work creating assets for games, websites, and other digital platforms.

The metaverse is in high demand for 3D content creators, animators, and general creative talent. If you have any of these skills, now is the time to start looking for work in this growing industry. You can sell your models on OpenSea or a similar marketplace and get paid in cryptocurrency. 

Fitness games and NFTs: How can both be related?

The short answer is, yes, fitness games and NFTs can be related. In fact, there are already a few examples of how this is happening. STEPN is one such example. It's an app that allows users to convert their steps into real money.

Participants must buy a pair of 'sneakers,' which are simply NFTs of shoe drawings. These NFTs give users access to monetizing their steps. Every time a user completes a certain amount of steps, they earn cryptocurrency that can be traded for fiat. The app also has a leaderboard to encourage competition and healthy living.

The platform claims its users have traveled over 31,979,672,128 meters, which is the equivalent of 786,991,807 miles. In other words, people are getting up and moving because they're being incentivized with real money.

How To Create an NFT Collection as a Game Studio?

A lot goes into a successful NFT drop. If you want to create an NFT collection as a game studio, there are a few things you need to keep in mind.

First, you need to have a clear idea of what your collection will be about and what purpose it will serve. Are you trying to raise awareness for your game? Reward your most loyal fans? Or generate revenue?

If you're having trouble with the specifics, contact the experts at Mantial. We are an end-to-end solution for NFT drops and can help you with everything from the planning stages to the execution.

Our tools like the Art Gen, Launcher, and Bot will help you create and manage your collection with ease. We'll also take care of everything that has to do with smart contracts, and our team of experts can guide you through every step of the process to make sure your drop is a success.

Bottom Line

NFTs constitute a significant development in gaming, and it's clear they are here to stay. With their unique benefits, we can expect to see them have a major impact on the industry in the years to come. From social dynamics to real-world benefits, NFTs are sure to change the gaming landscape as we know it.

Contact us today to learn more about how we can help you with your NFT needs. We are the leading provider of NFT solutions, and our team is ready to help you take your gaming experience to the next level.