How blockchain technology could bring triple-A games to the metaverse

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Non-fungible token-based projects like Loot and The N Project have helped spike interest in the metaverse to an all-time high, once again raising hopes that blockchain will finally break through to the masses. Will he or is history doomed to repeat itself? The problem is, the things that capture the public’s imagination are the same things that ultimately degrade the performance of the underlying platforms and raise barriers to entry more than ever. In this article, I’ll explore the fundamental issues responsible for creating that momentum in an effort to help solve these issues once and for all.

The fundamental problem is that legacy blockchain technology – especially Ethereum – introduces huge barriers to entry that hamper the ability of the metaverse to onboard new users. These problems are then exacerbated by the inability to allow network users to statically charge for their use of the network.

Monkeys and penguins are expensive

The fees required to use popular NFT marketplaces can be an insidious problem as projects often impose these costs on the user with often unrealistic expectations of their profit potential. A quick glance at Etherscan reveals the incredibly high value of transaction fees paid per project. Projects like Bored Ape Yacht Club and Pudgy Penguins have seen their users pay 106.7 and 111.4 Ether (ETH), respectively, to interact with their smart contract. Together, the users of these two projects had to shell out nearly a million dollars in transaction fees alone!

Axie Infinity, really based on NFT?

But here’s the problem: these projects aren’t actually NFT-based games! In Axie Infinity, players can fight and breed small creatures which can then be sold or rented to other players precisely because they are implemented as an NFT. This is what makes Axie Infinity a great example of a truly NFT-based game. The problem is, the more a game actually exploits NFTs and the benefits of a blockchain-based asset, the more ETH fees users have to pay.

The commercial and reproduction aspects of these games incur transaction fees on the Ethereum blockchain. Axie Infinity paid over 15,000 ETH in transaction fees, which roughly equates to over $ 60,000,000! It is money that developers could have spent to improve their product but, more importantly, it is money that users could have spent to buy even more digital assets from Axie Infinity and other game developers.

The catch-22 for new users and editors

Many new users drawn by the NFT craze head straight to a market like OpenSea to list their own NFT. In an ideal world, this would be a fantastic opportunity to add another blockchain advocate to the ranks by providing a fantastic user experience. Unfortunately, right now the transaction fees associated with simply listing an item for sale on OpenSea are around 0.1 ETH, or around $ 400. It’s not the kind of user experience that makes people think they’re using futuristic technology!

These absurd fees not only hurt new users trying to find out what this blockchain craze is all about, but they also deter large business entities from relying on blockchain platforms. Why would the big video game publishers build NFT interoperability into their video games if the end consumer of their product had to pay more than $ 100 or so to trade in their in-game weapon skins. Surely no consumer would be thrilled. by in-game NFT assets that cost more to trade than the base game.

Even if a large video game publisher had the ambition to cover these blockchain transaction costs for its player base, these costs would still be prohibitive and would increase in proportion to the game’s life cycle. Indeed, this game publisher would be penalized at as the replayability of his game increases! Given these shortcomings with current blockchain transaction pricing, it’s no surprise that we haven’t seen video game developers and publishers headlong into digitizing game assets using of the blockchain.

Free blockchains

Obviously, there are substantial issues with current NFT-based games on legacy blockchains. This is in large part due to their transaction pricing mechanism, which hampers adoption by new users and deters video game publishers from implementing NFT assets in their game. Triple A video game titles use blockchain to track ownership of game assets. It would simply be far too expensive for consumers or publishers to bear the cost of transactions on a paid blockchain.

There is hope, however. It is possible to eliminate user experience fees from a blockchain. The Steem blockchain (which integrated with Hive to thwart Justin Sun’s hostile takeover) has been operating on a no-cost model since its inception in 2016. Splinterlands, one of the most successful blockchain-based games, has leveraged the fees. -less of the properties of Steem, and now Hive, for a spectacular effect.

Related: Going without feeling is the only way to enable blockchain adoption

The essence of the solution contents within these blockchains is the introduction of a token derivative or “property” which is used to “pay” for transaction fees, instead of something like Ethereum gas, and which can be “delegated” from one user (such as a developer) to another user (such as a player).

Using a token derivative to cover the cost of transactions allows game developers to statically price their network usage over time. If this sounds a bit confusing to you, don’t worry; I am going to explain.

Consider, for a moment, if Axie Infinity had been built on a no-fee blockchain that exploits such a token derivative instead of forcing users to lower their balances. If that had been the case, the developers could have bought a given amount of native currency proportional to the network bandwidth they would need for the game, then delegate the network resources to new users.

Fuel growth

For starters, this would have allowed new users, who receive the delegated resources, to be able to trade in their Axies and interact with in-game smart contracts for zero transaction fees. This would then allow the game to naturally develop its player base, as players would not be discouraged by the cost of playing the game. This would reduce the barrier to entry, channeling more new players into the ecosystem and stimulating the game. demand for in-game assets.

Such a pricing structure could allow game publishers and developers to pay a single fixed cost for consistent use of the network. On Ethereum, you pay per transaction, which is a big deal – around $ 60,000,000, as of November 2021 – for games like Axie Infinity. Of course, what happens when the user runs out of token derivative? Wouldn’t they be back where they started? Finally, not if it regenerates over time!

Related: Navigating the NFT minefield: this should be made easier for first-time buyers

Because we are talking about a property of a token, and not the tokens themselves, it can be programmed as we wish without significant economic consequences. The purpose of this property is not to exchange value, but to motivate the use of the network, and it can be designed accordingly. If we don’t want users to be forced to constantly buy more and more tokens, all we have to do is regenerate the token ownership over time, which would also give us the static price that we search and theoretically unlimited transactions for the user! Therefore, a game like Axie Infinity would just need to make a one-time purchase and never have to pay – or charge its playerbase – transaction fees again.

Resources could be continuously delegated from the publisher or developer directly to the active player or user base, offering players free interactions with smart contracts and essentially solving a $ 60,000,000 inefficiency in space. NFT game.

The current structure of paid transactions poses a direct threat to mass adoption. At Koinos Group, in addition to creating the first user-friendly blockchain, we are working on a solution that would allow large organizations to better assess the costs associated with adopting this cutting-edge technology.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research before making a decision.

The views, thoughts and opinions expressed here are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Thomas Clement is a blockchain analyst at Koinos Group, a blockchain development company dedicated to helping people leverage blockchain for the benefit of humanity.


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