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3 Reasons Cryptocurrency is a Huge Deal in Gaming

It almost goes without saying by now that cryptocurrency and blockchain technology have developed all kinds of fun and interesting applications. They are sought after as new-age investments with massive potential; they facilitate a variety of token-based online transaction networks; they have changed the notion of digital contracts in a way that has altered numerous industries; and as Start It Up covered in detail on Medium, they’re completely revolutionizing the supply chain industry, with profound implications all around the world.

As impactful as all of these concepts and applications are already proving to be though, a lot of the most exciting chatter surrounding cryptos and the blockchain of late has concerned gaming. While gaming was not among the primary considerations at the foundation of the blockchain and early cryptocurrencies, there has begun to be crossover that in retrospect was always inevitable. And now, there are clear reasons to believe that cryptocurrency is going to be a very big deal in various portions of the gaming world — from new games, to online casinos, to the biggest and most popular mediums for traditional experiences.

Investment in Blockchain Gaming

Regarding new games, the key trend to keep in mind is the explosive investment we’ve begun to see in blockchain-based game development and hosting. This is something we explored in another article titled ‘These Investors Are Betting Big on the Future of Blockchain Gaming’ — wherein we detailed massive amounts of money being put toward the creation of blockchain ecosystems for game makers and players. This investment is already beginning to produce entirely new games hosted on blockchain networks, effectively giving rise to a whole new type of online gaming.

How all of this evolves specifically is impossible to say right now. But it is quite clear that a new gaming medium is emerging. It’s an environment in which developers are free to create, gamers can find all sorts of exciting new material, and there is even potential for unorthodox transactions that are not common (or allowed, in some cases) in more conventional types of gaming.

Revitalization of U.S. Online Poker

This is more of a possibility than a sure thing. It is a fascinating possibility however, given the history of online poker in the U.S. To summarize that history briefly, online poker used to be a popular and lucrative corner of the broader online gaming industry in the U.S. However, legislative changes in the mid-2000s largely outlawed online poker platforms — or at least heavily disincentivized them from operating on U.S. soil. The ins and outs of the legislation are a little bit complicated, but the basic notion is that banks are prohibited from involvement in funds earned via interstate gaming. This reduced the potential for business enough that the industry more or less evaporated.

Cryptocurrency, however, may provide a workaround. As is explained in a write-up on cryptocurrency and online poker by Poker.org, the fact that the legislation revolves around the banks’ ability to handle gambling-related funds means that crypto gaming might not be affected. Banks cannot handle cryptocurrency anyway, which raises the question of whether it is considered to be a “real” currency that people in the U.S. are not allowed to use in online gaming transactions. If this idea proves to be legally viable (right now it’s still somewhat unclear), cryptocurrency could be responsible for the swift return of an entire branch of the gaming industry in the U.S.

In-Game Earnings & Exchanges

In addition to new gaming platforms and casino-related gaming, we mentioned that cryptocurrency and blockchain technology had the potential to impact the biggest and most popular traditional gaming mediums. By this we meant that the technology likely has a role to play in “regular” video games — those for mobile devices, PCs, and consoles — as well. Specifically, blockchain tech and cryptocurrency will soon be used to facilitate in-game earnings and exchanges of assets with genuine real-world value.

This is actually something we’re beginning to see some early examples of. Very recently in fact, CNBC wrote about people in the Philippines playing a game called Axie Infinity, wherein they collect NFTs for digital pets, raise said pets, and sell them for actual cryptocurrency. This is a very straightforward early example of something we expect to see much more of — and which will eventually likely make it into some of the most popular games in the world. It is not hard to envision mainstream games in which achievements earn crypto rather than fake, in-game currency.

All of these developments should be fascinating to track in the next few years. And in the end we’ll likely look back and realize that crypto and blockchain had as profound an impact in gaming as in anything else.

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