Minecraft, GTA may change the tune of blockchain yet: GameFi executives

While several mainstream game studios have taken a noticeable step back in integrating blockchain technology, three blockchain game executives say it’s only a matter of time before they change their tune.

Last July, Minecraft developer Mojang Studios announced a ban on NFTs and blockchain technology.

In November, Rockstar Games updated its website to state that fan-operated servers for Grand Theft Auto V can no longer use crypto-assets, specifically non-fungible tokens (NFTs).

However, Walter Lee, Gaming Growth Lead at BNB Chain, claims that the ban is more related to NFT activities than general blockchain technology, and believes that once “more regulation is in place” to guarantee player safety, mainstream studios will warm up to the technology.

“There is still a lack of education and regulation around Web3, so some users and companies are still skeptical of its benefits and the scams that can often be associated with it,” he said.

Mojang Studios pointed to concerns surrounding certain third-party NFT integrations, along with NFT wash trading and digital ownership issues as reasons for the ban.

Lee believes player demand will eventually tip the scale of blockchain technology in mainstream gaming.

That said, some gaming enthusiasts have a love-hate relationship with crypto, especially when NFTs are involved.

French gaming giant Ubisoft Entertainment was last year forced to back off plans to integrate NFTs into its games following player backlash.

An October 2022 survey by blockchain entertainment provider Coda Lab found that traditional gamers were not a fan of cryptocurrencies or NFTs in general, although they did not seem to care much about NFTs used in games.

“If there is an increased demand from players for blockchain integrations, they will likely revise their policies,” Lee asserted.

Speaking to Cointelegraph, Grant Haseley, the current CEO of mobile and Web3 game development company Wagyu Games, believes that a success story is all it takes to spark mainstream adoption, saying:

“AAA studios will change their minds when they start giving real market share to Web3 games. It only takes one Web3 game to explode before the others can fly.”

According to Haseley, the mainstream is hesitating about adoption for fear that it will undermine their current business model with “the consumer strictly paying for entertainment”.

“They have a big thing going on right now, the mobile gaming market, for example, has broken $100 billion and is trending upwards,” Haseley said, adding:

“If you can make a game on the fly and still maintain profitability without changing your model, why would you even consider something radical that could have lasting effects on your consumer base?”

Justin Hulog, Chief Studio Officer at Immutable Games Studio, shared a similar perspective, explaining that because NFTs and cryptos fundamentally transfer ownership of digital assets from companies to players, it has little appeal for mainstream adoption.

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“GTA V became the most profitable entertainment product of all time, and it’s no secret that a significant part of this profit comes from microtransactions that contain in-game currency,” he said.

“Microsoft also introduced microtransactions in Minecraft some time ago; it’s understandable that both companies want to keep control of their in-game economies for financial reasons,” he added.

According to a 2020 report by market research firm Junpier Research, loot boxes and other microtransaction-related features will bring game companies $20 billion by 2025.

“If anything, this could even be interpreted as both companies recognizing that NFTs and crypto are real-world assets with value attached to them that could potentially threaten their business model,” Hulog said.

While he believes it’s “definitely a possibility” that mainstream studios will embrace blockchain technology, he believes they “will probably start with something like adding support for cryptocurrencies as a payment method for their games and services.”