Video games have a very dynamic market, with brutal potential for generating economic value. According to Newzoo, this year it will generate revenue of more than $152 billion worldwide, and that number is expected to reach $196 billion in 2022. The compound annual growth rate between those two years is almost 10%.
It’s hard to imagine a future where video games are no longer popular. A world without digital currency is difficult to imagine. Cryptocurrencies are fast becoming part of our daily lives and as many have predicted, we may consider digital tokens as the primary tool for buying everyday items. The video game and cryptocurrency industries are the two fastest-growing industries today.
The question is to determine if blockchain can become the third vector of disruption of the traditional video game, or if, on the contrary, its application will remain somewhat experimental and anecdotal.
Crypto and video games will soon be linked together.
Competition between electronic sports players has grown dramatically in recent years. The number of people participating in electronic sports activities and watching live streams increases each year. The number of people watching the esports tournament this year is estimated to increase to more than 420 million. This is a very profitable industry and revenues are increasing.
The future of cryptocurrencies and video games is almost inevitable. The most popular video games have started to implement cryptocurrencies, which others should follow. The connection between the two is so close that their coexistence and development seem very natural. But how do video games contain cryptocurrencies? The answer is simple.
Why is cryptocurrency important in the video game industry?
For video game developers, it is important to be successful in making money from the game. It is only possible when the game is popular and forms a large community around it. This ensures that the game remains relevant for a long time and that the number of players will increase. The problem with blockchain is that it is often tried to implement in activities where it is not necessary or in which it is not the ideal solution to a problem. It is what usually happens when something becomes fashionable, that everyone wants to apply it at all costs to appear modern or, as they say now, disruptive.
Many people use the referral system to attract new players. This is a very simple process, as players like to stick together and share the game experience, especially if it is a video game that they have enjoyed for a while. Video game developers are also trying to increase the number of people watching the live stream as it is becoming more popular entailing a significant increase in one’s income. The profit revolution is high in the case of video games that are linked with bitcoin.
However, they must ensure that the gamers receive something in return for their dedication to the game. Previous major prizes included in-game bonuses, early DLC passes, and costumes for characters.
These companies rarely give gifts that can carry living expenses. The introduction of cryptocurrencies facilitates change and the creation of a better rewards system that will attract more players.
Why Bitcoin could change the video game industry?
As stated by James Bray, an investment analyst at Capital Group, blockchain technology is attractive to financial companies because it builds trust between the parties when they are directly related.
According to Sarwono, there is no need to maintain a large centralized database or to have “an intermediary or central authority” that guarantees the legitimacy of the process. Chain members can confirm transactions and update their logbooks in real-time.
The financial sector could use modernization. According to Bray, this is an advantage; but it could also generate financial gains. If the blockchain settles these transactions immediately, those reserves would be released and the funds could be used for other more profitable uses.
Blockchain is not only faster but also cheaper. According to Sarwono, consumers typically pay a commission of about 4% when sending money to someone who is in another country. A new company has launched an application that allows two people to exchange money through blockchain and without any intermediary, for a lower price.