Cryptocurrency is a hot topic right now, and whatever your views are on it, there’s no doubt it is here to stay.
Early 2021 saw a boom thanks in no small part to Elon Musk and his decision to accept bitcoin as payment at Tesla. As we have moved into the summer, the value has crashed, but history proves that cryptocurrency has far more peaks and troughs than standard currency. It is volatile, unpredictable and yet also seen as the currency of the future.
As outlined in our article ‘Crypto Investment: Exchange vs. Broker’, investors should be aware of the different exchanges and market forces that impact value. For every Elon Musk tweet, there is another causing investor instability. There is a downward spiral for every upward trend, and understanding the different types of crypto and where they may be popular will give you an advantage. That is why the world of online gaming is one that investors should study carefully.
Online gaming is one of the industries in which bitcoin is seemingly gaining popularity and offering some benefits to those who choose to use it. Some online gamers feel exposed when dealing with sites, in no small part due to the controversial Black Friday poker crash more than a decade ago. That event damaged the credibility of the online poker industry, which is an area cryptocurrency can help with. Poker.org explain how it is of value to players to get an IRS IP PIN to help protect against fraud, but some players may wish to go further. By depositing and withdrawing in crypto, the player and provider are anonymous. Blockchain is both secure and anonymous, meaning gamers are protected from potential fraud.
That then has benefits across other gaming channels, too. For instance, cryptocurrency is a method by which some providers can navigate laws in certain countries around wagers with money. Without the intervention of banks, a crypto casino as they’re called cannot easily be traced to a country of origin, and the same goes for the players. Some may find this grey area concerning from a fraud perspective, with NYPost.com reporting that more than $400m of cryptocurrency was recently seized by police in the United Kingdom. However, reputable crypto sites ensure identity is required when purchasing currency, which goes some way to alleviating fears.
In the wider online gaming world, cryptocurrency has a big future. Developers such as Epic Games and EA Sports make a lot of money from in-game purchases on Fortnite and FIFA, and they are not alone. Rockstar Games sell ‘shark cards’, which gives gamers in-game currency to spend, but there is a black market for these items, which means they lose money. Coin farming on FIFA is a big problem, but if they were to introduce their own cryptocurrency to be used in-game, and there was no apparent monetary value to those items, it would ring-fence the market and ensure increased profits. Also, with no banks involved in blockchain, it is less costly for developers in terms of additional fees and involving third parties.
San Francisco based company Forte is enabling developers to do just that. They use blockchain technology to allow new types of in-game economies, which offer the protection gamers, and developers feel they need. “We set out to create a platform that makes it easy for game developers of any size, including the world’s largest publishers, to incorporate blockchain technology into their games,” Forte CEO Josh Williams told GamesBeat. “(That will) enable players to own digital goods and currencies, and trade with each other, have true property rights and, and create thriving economies that both players and publishers can benefit from”.
The advantages of crypto within the gaming sector are numerous, and we have touched on just a few here. The irony is that game developers, online gaming providers, and customers all see blockchain and cryptocurrency as a way of preventing fraud and minimizing exposure to criminal activity, whilst those who operate within the accepted and understood methods of payment see it as quite the opposite.
The truth is whilst there are risks, they are not causing the parties involved in transactions to be targeted, and that is why the gaming industry is the one area that cryptocurrency investors should keep a close eye on.