Op-Ed · Web3 Gaming
The Black Hole of Wasted Hours Is About to Become an Asset Class
Web3 gaming receives more hate than it deserves — and the people throwing shade are missing one of the most obvious use cases in crypto right in front of their faces.
Web3 gaming receives a lot of hate and praise from members in the crypto space. Some of this treatment is understandable — most of it is horribly unjustified. Like most sectors in crypto, bad actors and profit-chasing schemers were quick to pollute what should have otherwise been a beacon of excitement and hope for gamers globally.
Endless hours are poured into video games of all genres with one congruent theme: money put in is money lost forever.
“Those toys you played with as kids — dolls to some, action figures to others — luckily hold some, if not gain, value as you grow older. The same cannot be said for the poor fools who spent hours, days, weeks, or even months of cumulative time playing video games.”
Those hours were lost to the black hole of an archaic, centralized system. And it didn’t have to be that way.
Currently, the gaming industry is worth more than the global box office and music industry combined. That’s not a typo. Gaming — and I use that term broadly, because there are quite a few different slices that make up this pie — is an objectively massive market. Mobile games alone make up roughly 50% of it, with console and PC splitting the remainder.
3.4% year-over-year growth per Newzoo. With 3.49 billion active players worldwide, gaming now dwarfs the global box office and music industry combined — and it is still growing.
With no sign of slowing down, the magnitude of major titles is increasing. Games like GTA VI are leaving consumers salivating. The average GTA V player logged somewhere between 55 and 70 hours — roughly 2 to 3 days of their life. We all know someone with a few weeks on the clock. When your business revolves around a consumer base that is rapidly growing and staying for longer, you are in a very good market.
This point has been recognized by the people running these companies. Strauss Zelnick, CEO of Take-Two Interactive, has floated the idea of a pay-per-hour cost structure rather than an upfront game purchase. Respect to the thinking. I have a better idea, Strauss.
Let’s embrace gaming’s natural destiny: blockchain integration. Not as a gimmick. Not as a speculative layer tacked onto a mediocre game. The right model is what Off The Grid has demonstrated — use a traditional engine for the game itself, and blockchain exclusively for the in-game marketplace and item collection. Game first. Blockchain second.
This solves two problems simultaneously. Your friend who spent weeks grinding the game can actually benefit monetarily from his time. And companies like Take-Two can still make money — more money, arguably — off marketplace transaction fees. They already rake in billions from microtransactions. They still will. People will still be using fiat to bridge into whatever the in-game currency is, and developers can take a healthy cut of every peer-to-peer transaction.
The math works for everyone. A man who is starving will not care if you keep half the 12-ounce steak you are offering him. Gamers won’t care either — because any system that gives them real ownership of their digital assets is so fundamentally better than what exists today that the fees are irrelevant.
While some are still missing the forest for the trees, there is a gigantic use case for Web3 gaming and NFTs that is right in front of our faces. Everyday gamers — the guy grinding Warzone, MyPlayer in 2K, Fortnite, PUBG, Rocket League, whatever your game of choice is — are craving a system like this. They just don’t know it yet.
“Imagine a game that runs high-stakes tournaments where your favorite streamer is competing with real money on the line — for skins, gear, NFTs with actual market value. More viewers. More donations. More engagement. The whole gaming machine gets bigger.”
The seeds of this future are already planted. Cedral Advisory will be publishing a full research report on the state of Web3 gaming, with an in-depth look at Gunzilla Games and Off The Grid, the role of the industry giants, and what the NFT ownership thesis really means for the next decade of digital entertainment. Stay tuned.