Categories: FAQ

Tokenizing Virtual Assets Using Blockchain Tech Will Disrupt the Billion-Dollar Gaming Industry

The crypto world appeals to a number of gamers and individuals involved in the gaming industry, as there are many similarities between the two ecosystems. The most obvious similarity, though, is the idea that virtual goods can be exchanged for fiat money.

For example, dating back to the World of Warcraft (WoW) days in 2004, gamers started to understand that “virtual game items” won while playing these games (weapons, gold, etc.) could be exchanged for money.

“In 2007, World of Warcraft got really big and the virtual items market started gaining popularity,” long-time gamer and CEO of BitGuild, Jared Psigoda, told me. “Many people were buying World of Warcraft gold and weapons to power level their accounts. I started a business while I was traveling abroad in China to sell virtual goods to U.S. and European gamers who didn’t want to spend that much time playing video games, but wanted the same benefits as someone who had.”

It’s apparent that gamers have long understood the value that virtual items can have when traded in the real world. And as the cryptocurrency market continues to gain traction, virtual gaming items, such as swords and metals, are now being “tokenized” across “blockchain games,” allowing gamers to own assets and trade them within networks to earn profits.

The CryptoKitties Evolution

The popular blockchain game CryptoKitties is one of the best examples of the impact that tokenized assets are having on the gaming industry.

Since the CryptoKitties game was launched in late November, players have spent more than US$19 million on trading cartoon kittens living on the Ethereum blockchain network. According to the third-party data site CryptoKitties Sales, nearly 50,000 cats have been bred or released. At one point, the game was responsible for nearly 25% of all Ethereum transactions, which caused major traffic jams on the Ethereum network.

Yet the real value in CryptoKitties goes well beyond just trading and creating cute, virtual kittens. For gamers, there are big profits that can be gained from playing CryptoKitties. In the game, each cat comes with a specific set of attributes, and the rarest ones can be extremely expensive. It’s important to understand that gamers own each of the kitties they create or buy, which serves as a tokenized asset that is an ERC721 token with a smart contract that goes into each player’s wallet.

This is why gamers playing CryptoKitties are interested in the first implementation of the tokenization of virtual assets, as they know that they have full ownership over them. After all, gamers wouldn’t pay hundreds of dollars for a virtual sword that they could lose at any moment if the game’s publisher went bankrupt. Like Bitcoin, virtual assets acquired through blockchain games are permanent and remain in gamers’ wallets until traded or sold.

“Blockchain Games” Will Become the Next Big Genre For the Gaming Industry

The rise of CryptoKitties and the concept of tokenized virtual assets have paved the way for the creation of more blockchain games. As a result, a number of blockchain gaming platforms have been created.

An idea that started out as selling virtual game items to U.S. and European gamers eventually led Jared Psigoda to become the founder and CEO of BitGuild, one of the most innovative blockchain-gaming platforms on the market. The company’s public ICO launches on March 15, when the team plans to raise funding with the sale of their PLAT token.

“The crypto world reminded me so much of gaming economies. I think some of the biggest names in the crypto space came from video game item trading because they understood the concept of virtual tokens being worth real money way before everyone else understood this,” Psigoda explained. “We had the idea to build a platform for blockchain gaming, which is how BitGuild developed.”

When the CryptoKitties blockchain game gained popularity in December of last year, Psigoda understood that it appealed to so many gamers because players actually owned these kitties. Moreover, the kitties that each player acquired served as “virtual tokenized assets” which lived within each player’s digital wallet.

In order to advance the blockchain game evolution, BitGuild’s platform will allow game developers to directly implement blockchain into any game and tokenize all of the gamers’ assets by putting them directly in their own wallets. Through BitGuild, gamers will be able to own each of their virtual assets, craft them and also trade them.

Being able to both tokenize and trade virtual assets are a major reason why blockchain games are disrupting the billion-dollar gaming industry. Unlike other blockchain-gaming platforms that entice existing developers to tokenize all of their assets on the blockchain, BitGuild is building entirely new blockchain games that tokenize everything and have trading systems built to run on the blockchain.

The first game to be built on BitGuild is expected to launch in early May and will be called BitGuild: The Game. This game will allow users to create avatars on the blockchain, which will serve as “blockchain” versions of themselves. Users will be able to share their virtual selves with others on the blockchain, and all items will be tokenized, allowing gamers to buy, sell and trade their avatars between games on the blockchain.

“I view blockchain games to be an evolution of an entire new genre of games for the gaming industry,” Psigoda explained. “Blockchain games utilize smart contracts, have tokenized assets and provide open trading systems. There is potential for many new blockchain games to be developed and it will be interesting to see how things evolve in the next year.”

Rachel Wolfson

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Rachel Wolfson
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