An in-depth analysis of blockchain gaming Is it a bubble or a new revolution?

A Comprehensive Examination of Blockchain Gaming Revolutionary Innovation or Economic Bubble?

Source: Ryze Labs

1. Introduction: What is a Full-Chain Game?

Recently, the LianGuaiss card in the full-chain game Sky Strife reached 21000ETH, causing many non-full-chain game players to marvel at the magic of this track. Since the release of “Pong” in 1972, the gaming industry has been skyrocketing. From classic 8-bit games like “Super Mario” and “The Legend of Zelda” to highly complex and social network games like “Fortnite” and “League of Legends,” gaming has evolved beyond simple entertainment. The social, competitive, and immersive experiences offered by these games have far surpassed our imagination.

However, with the rise of blockchain technology and the development of cryptocurrencies, the gaming industry is reshaping our experiences in unprecedented ways. From innovative projects like Axie Infinity that tightly integrate gaming with the crypto economy, to games like Stepn that prioritize social interaction and innovation, blockchain games are gradually being seen as the key to achieving Crypto Mass Adoption. People are also exploring new ways to integrate gaming and blockchain, beyond just asset tokenization. This has led to the emergence of full-chain games.

So, what makes full-chain games different from traditional games?

In traditional games, all game logic, data storage, digital assets, and game states are stored by centralized game companies. For example, when we play games like “Arena of Valor,” “Genshin Impact,” or “Dungeon Fighter Online,” all the game content and in-game assets belong to the centralized companies.

In contrast, asset tokenization games (commonly referred to as Web2.5 games), such as Axie and Stepn, tokenize game assets. On one hand, players can own the assets and, on the other hand, enhance the liquidity of the assets. However, when faced with a game shutting down, the game assets may still lose their circulation value. Rather than replacing traditional games, asset tokenization games complement them, similar to the relationship between food delivery services and physical restaurants. Likewise, Web2.5 games face competition from other Web2.5 games and traditional Web2 games.

In the case of full-chain games, which have recently received much attention, all interactive behaviors and states within the game, including game logic, data storage, digital assets, and game states mentioned earlier, are all recorded on the blockchain and processed by the blockchain. This achieves true decentralization in gaming.

To help you understand better, I have summarized the characteristics of full-chain games into the following four points:

Data authenticity is ensured by the blockchain. The blockchain is no longer just a supplementary storage, but the true source of game data. It is not limited to recording asset ownership, but serves as the storage center for all critical data. This approach fully utilizes the programmable nature of the blockchain, enabling transparent data storage and permissionless interoperability.
The game logic and rules are implemented through smart contracts. For example, various operations within the game can be executed on the chain, ensuring the traceability and security of game logic.
Game development follows the principles of an open ecosystem. Game contracts and accessible game clients adopt an open-source model, providing vast creative space for third-party developers. They can create content, customize their game experience, and share it with the entire community through plugins, third-party clients, and interoperable smart contracts.
The game is independent of the client. This is closely related to the previous three points, as the essence of a truly native crypto game lies in the fact that the game can continue even if the core developer’s client disappears. This depends on the permissionless storage of game data, the permissionless execution of logic, and the community’s ability to interact with the core smart contracts independently, without relying on interfaces provided by the core team. Thus, true decentralization is achieved.

2. Why do humans need blockchain games?

Before understanding why we need blockchain games, let’s briefly understand the current situation and operating models of the traditional gaming industry.

Blockchain games are essentially games, and it is important and necessary for us to understand the operating models of traditional games in order to understand and analyze the future of blockchain games.

1. Current situation of the traditional gaming industry

With the development of the gaming industry, many excellent Web 2.0 games have emerged in our growing up process. Whether it’s FPS games like Counter-Strike and CrossFire, RPG games like Dungeon Fighter Online and Dragon Nest, or MOBA games like League of Legends and Honor of Kings, or even card games like Onmyoji and Hearthstone, games have become a very important part of our entertainment life.

According to Fortune Business Insights, the global gaming market size will reach $249.55 billion in 2022, and is expected to exceed $280 billion in 2023 and over $600 billion by 2030. Comparing this to the global movie and entertainment industry, which had a market size of $94.4 billion in 2022, we can see that games play a very important role in the economic development as a leisure and entertainment industry, with many aspects worth exploring in terms of commercialization. It can be said that games are the crown jewel in the leisure industry.

1) Why do humans love playing games?

According to the data from Statista, the number of global gamers has exceeded 2.5 billion and is close to 3 billion. So how does the game attract more than one-third of the world’s population to participate? The core reason can be summarized as meeting people’s needs and weaknesses from various aspects:

Escape from reality and restart life: Games provide a place where people can escape from the pressures and challenges of everyday life. In the game, people can get rid of the troubles of reality, immerse themselves in a virtual world, and have a second life.
Socializing without burden: For multiplayer online games, games provide a platform for social interaction, which is more friendly for people with social anxiety. Players don’t have to worry about the gaze of others in real life, so they can do what they want to do and build relationships with others.
Instant feedback and rewards: Unlike the struggles of students and workers in daily academic and work life, games are very attractive because they provide a rich reward system and instant reward mechanisms. After putting in effort, fighting monsters, and completing challenges, players quickly gain new skills, unlock new levels, or obtain new items. This incentive mechanism can inspire people to keep moving forward.
Low-cost freedom of exploration: Many games provide a rich virtual world that allows players to explore unknown areas, interact with NPCs and other players, and drive the development of the storyline. This satisfies humans’ innate desire for adventure and exploration. In the real world, compared to the exploration in the game world, exploration has much higher costs due to money, energy, time, and geographical limitations.
Pursuit of achievement and self-realization: By completing a series of tasks and goals, people can achieve the desire for success and recognition. Whether it’s rankings or achievement scores, people can more easily challenge themselves and grow in the game.

To target one or even multiple weaknesses of human nature, games can cleverly meet the needs and preferences of different users, playing a positive role in both reaching a wide audience and providing deep immersive experiences.

2) Current Situation and Development of Traditional Games

Next, let’s briefly understand the current status of the traditional gaming industry.

In traditional games, they can roughly be categorized into Shooter, Adventure, Role Playing, Battle Royale, Strategy, Sports, Puzzle, Action, Simulation, and other game types.

According to data from Newzoo, role-playing and adventure games perform outstandingly well on PC, mobile, and console platforms, consistently ranking among the top five. Additionally, shooting and battle royale games are also very popular on PC and console platforms. On mobile platforms, puzzle and idle games have gained popularity as well.

2. Challenges in the Traditional Gaming Industry

However, the traditional gaming industry currently faces two major challenges: restrictions imposed by game licenses and high pre-release costs, leading to slow recoupment and potential sunk costs.

1) Restrictions imposed by game licenses

Game licenses refer to specific permits issued by governments in certain countries or regions for game releases. This system aims to regulate game content, ensuring that games comply with the regulations, culture, and values of the country or region to protect minors from inappropriate content and maintain social stability.

For example, in Germany, game content is subject to strict scrutiny, particularly focusing on content that may have a negative impact on young people. South Korea and Japan have game rating systems evaluated and issued by relevant governmental organizations.

In China, the impact of game licenses is even more significant. China implements a strict game licensing system, supervised by the National Radio and Television Administration. Games need to obtain a license before they can be released in the Chinese market.

After the release of 87 licenses on July 22, 2021, the approval process stagnated for a long period until April 2022 when it gradually improved. In April 2022, 45 licenses were released, followed by another batch in September and December. However, during the stagnation period from mid-2021 to April 2022, only a few large companies managed to survive, while a large number of small and medium-sized game companies faced closure. According to data from Tianyancha App, over 14,000 small and medium-sized game companies (with registered capital of less than 10 million) were deregistered between July and December 2021.

China, as the world’s largest gaming market, has over 500 million people playing video games. However, obtaining game licenses has become a pain for countless Chinese companies. Even after obtaining a license, the tightening or constant adjustment of licenses has become the sword of Damocles for every game project. In the days without license releases, you can hear countless project teams without funding facing the sigh of bankruptcy.

2) The pre-release costs are too high and easily give rise to many hidden costs.

In the development model of Web2 games, the early stage involves costs in terms of manpower and infrastructure. There is idle time cost during the wait for licenses. Only when the licenses are released, the game is distributed, and commercial revenue is generated can profit sharing take place.

It is not difficult to see that a large amount of costs are incurred in the early stages. Once there are problems during the development stage, license stage, or user acquisition stage, all previous costs become sunk costs. For a medium-sized game, costs generally amount to several million US dollars. The long cycle of early stage development and release makes the profit cycle very long, which increases the risk of obtaining expected returns.

3. Attempting to Break the Stalemate in Web2.5 Games

In the face of these two predicaments, Web2.5 games are leading the way in breaking the stalemate. On one hand, Web2.5 games bypass the restrictions of domestic licenses by targeting global users, allowing citizens of the world to play. On the other hand, by issuing NFTs and tokens, income can be generated through market making during the game’s initial testing and start-up phases, greatly reducing the financial barrier to game production.

In the attempt to break the stalemate in Web2.5 games, remarkable games like Axie and Stepn have emerged. Axie’s popularity among Southeast Asians has led many people to earn a living through Axie, with income surpassing the average per capita income in the Philippines. Stepn’s move to earn mode has intrigued many non-Web3 users, leading them to ask, “How do you play that sneaker game? I want to try it too.” This sparked a wave of breakthroughs in blockchain games. However, as the Ponzi economic model collapsed, the subsequent development of Web2.5 games never reached the level of success seen by Axie and Stepn.

Builders have also begun to explore different directions. Some are heading towards producing AAA games, attempting to capture a share of the Web2 user base. However, this leads to competition both with Web2.5 games and Web2 games. Another group of people has chosen a different path, deciding to turn to fully blockchain games to explore new possibilities and validate their value. In this emerging industry of Web3, there are always pioneers who want to forge ahead on a completely new path.

III. Analysis of the Current State of the Blockchain Gaming Industry

Currently, the entire blockchain gaming industry is in its very early stages of development, whether it’s game projects or related infrastructure. In the industry landscape of blockchain gaming, it can be roughly categorized into four major types: blockchain game projects, blockchain game engines, blockchain gaming chains, and blockchain game distribution platforms.

1. Full-Chain Game Projects

Currently, full-chain game projects are still in the very early stages. Next, we will analyze several full-chain game projects to understand the current situation of full-chain gaming.

In terms of gaming projects, there are early well-known ones like Dark Forest, as well as recent ones like Loot Survivor, Sky Strife, Imminent Solace, and Loot Rayale. Most of the playable projects are still in the testing phase, and the total number of playable full-chain games on the market is less than 10. Overall, the games are mainly strategy-based (SLG), but there are also many new projects attempting simulation and management.

Since most games are still in the development and non-playable stage, we will mainly introduce a few playable full-chain games with unique features.

1) Dark Forest

First, let’s take a look at the representative work of full-chain gaming, Dark Forest. In simple terms, Dark Forest is a decentralized strategy game created on Ethereum using zkSNARKs.

Dark Forest was developed by Brian Gu, a graduate from MIT, under the pseudonym Gubsheep. It drew inspiration from Liu Cixin’s science fiction novel “The Dark Forest”. Other team members include Alan, Ivan, and Moe. This game project is not funded, but their team’s new project, Argus Labs, recently raised $10 million.

Dark Forest is one of the earliest incomplete information games built on a decentralized system. As a space conquest strategy game, players explore the infinite universe by starting their journey on their own planet, discover and occupy other planets and resources to develop their empire.

The three main highlights of Dark Forest: two of them were already mentioned when introducing full-chain games. First, the game logic, data, and state are all on the chain, and centralized entities cannot control the results of their actions individually. Second, a free and open high-combination game ecosystem: the open-source full-chain game model gives Dark Forest permissionless interoperability. Essentially, it is an Ethereum smart contract that can be interacted with by any address, giving rise to a prosperous secondary creation ecosystem (plugins) and generating more ecological communities.

For example, Project Sophon created a Dark Forest local library that allows users to start a game either off-chain or on-chain. Ukrainian gaming organization Orden_GG built a trading market for artifacts and added liquidity pools. MarrowDAO|GuildW @marrowdao from the Mandarin-speaking DAO community developed various plugins, including artifact trading markets and GPU mapping tools. Their user-generated content (UGC) ecosystem is very interesting.

(Source: MarrowDAO official Twitter)

Another significant highlight of Dark Forest is the use of zk-SNARKS technology for information hiding. For strategy games, if all information is transparent, opponents will know one’s position, and it becomes impossible to implement strategic opposition in a fully open and transparent environment. Dark Forest uses zk technology to hide most of the universe and opponents when players first enter the game. They only become visible when players explore hidden areas. Every time a player moves, they send a proof to the blockchain, proving that the movement is valid without revealing their coordinates in the universe.

Since the official v0.6 version Round 5 ended in February 2022, there have been no new game versions released for Dark Forest. Currently, the entire game is in a free-roaming state. If you want to experience the game, you can participate in some community-organized rounds, such as creating a small universe in the Arena system developed by dfDAO.

(Source: Fred creating a new universe in the Arena system developed by dfDAO)

Overall, Dark Forest has redefined the possibilities of Web3 games. Many people praise “Dark Forest” as a perfect example of the intersection between gaming and cryptography, inspiring many future blockchain gaming projects. According to previous reports, the cumulative number of players has exceeded 10,000+.

But the significance of Dark Forest goes beyond the game itself. As the first highly anticipated blockchain game, it is more like the spiritual totem of blockchain gaming, allowing industry builders to discover the myriad of freely open gameplay combinations and thriving derivative ecosystems that can emerge based on blockchain games, instilling stronger confidence in achieving the possibility of “Autonomous Worlds.”

After creating Dark Forest, the Dark Forest team, along with several other teams, formed 0xLianGuaiRC. While developing blockchain games, the Lattice project of 0xLianGuaiRC found that the existing development costs were extremely high. Therefore, in 2022, they started the MUD project, hoping to create a user-friendly blockchain game engine based on the ECS framework to solve the problems of contract-client state synchronization, continuous content updates, and interoperability with other contracts, thus lowering the development threshold and greatly promoting the development of blockchain games. In a way, Dark Forest is a huge symbol and accelerator of the blockchain gaming industry.

2) Loot survivor

Now let’s take a look at Loot Survivor, a game developed by the BibliothecaDAO team, which is an important part of the Loot ecosystem.

Loot was released on August 28, 2021, by @Dom Hofmann. Unlike common PFP-type NFTs such as BAYC and Crypto Punks, each NFT of Loot consists of white text on a black background. The interpretation of these texts is highly open and free, attracting a large number of ecosystem contributors and related derivative projects.

(Source: OpenSea)

Among them, Loot Realms, which launched on September 1, 2021, has been dedicated to the development of the Lootverse. Core contributors @lordOfAFew and @TimshelXYZ play important roles in this project, building the underlying narrative of Loot and presenting the gamification of storytelling through Realms’ first project, Eternum.

As early as February 2022, the team proposed the core concept of “Play 2 Die,” initially planned as an expansion of the Realms series called “Realms: Adventurers.” However, during the iterative development process, the team decided to quickly launch a smaller-scale single-player blockchain game, which gave birth to Loot Survivor.

Loot Survivor is a text-based dungeon crawler or Roguelike game that made its debut on May 25th (also the author’s birthday) at the Blockchain Game Summit in Lisbon, attracting a lot of attention.

The overall gameplay of the game is relatively simple, fighting monsters through text interactions until you die, and hoping to challenge yourself continuously through the leaderboard.

(Source: Screenshots and performance rankings of Fred in Loot Survivor)

Overall, the game has a small scale and replayability, but inherits the Loot ecosystem in terms of game design, adding game-driven narratives to the Loot ecosystem. Furthermore, as one of the flagship projects of the Dojo Engine ecosystem, it has given a boost to the Dojo Engine and Starknet ecosystem.

3) Imminent Solace

Imminent Solace is a recently released ZK fog-of-war-based treasure battle royale game developed on the Mud engine. The project team is developed by PTA DAO, a Chinese team that focuses on blockchain games. It combines PVP plunder, independent world exploration, and PoW resource mining. The gameplay is similar to the Dark Forest, but with simpler controls and a better user experience.

The ultimate goal of the project is to create a war simulation game similar to EVE, where players will face real losses in terms of resources and assets, requiring strategic challenges.

Imminent Solace is one of the more playable games among the recent blockchain games, with good game interaction and experience.

(Source: Screenshots and rankings of Fred in Imminent Solace)

In addition, there are also games such as Sky Strife developed by Lattice, OPCraft, SmallBrain’s text game Word3, web3 version of Werewolf Framed, and battle royale game Loot Rayale, and management game Genki Cats exploring the road of blockchain games. Most of them are still in the testing phase, and currently, there are only a few playable games in development.

Through research, it was found that current blockchain games are basically web-based games, with almost no PC and mobile versions.

On the one hand, this is related to the fact that blockchain games do not require a client. Since blockchain games can have multiple front-ends, the most important thing for project parties is to quickly create an MVP version for the community and users to play. Compared to PC and mobile development, web development is faster and has lower costs, making it the optimal or even the only choice for most projects.
On the other hand, blockchain games are still in the stage of concept verification, and the key is to quickly create playable games to validate the value of the game.

2. The Whole Chain Game Engine

Before we dive into the Whole Chain Game Engine, let’s first understand the essence of an engine:

In simple terms, it’s like standing on the shoulders of giants to see the world. A game engine integrates commonly used game development features into general code so that future developers don’t have to reinvent the wheel when creating games.

For example, in traditional game engines like Unity and Unreal Engine, game developers can directly use the existing engine to achieve the motion laws after a universe explosion or the trajectory of character movement after collision. This allows them to focus their energy on developing unique game content.

Similarly, the purpose of the Whole Chain Game Engine is similar. Compared to traditional game engines like Unity and Unreal Engine, which can handle tasks such as graphics rendering, physics simulation, and network communication, the Whole Chain Game Engine, due to the nature of blockchain games, focuses more on issues such as contract and client state synchronization, continuous content updates, and interoperability with other contracts.

Currently, some popular Whole Chain Game Engines include Mud, Dojo, Argus, Curio, and LianGuaiima. Among them, Mud and Dojo are the most mainstream engines, creating a situation where the EVM-compliant ecosystem and the Starknet ecosystem are competing. Let’s mainly introduce these two game engines here.

Mud

Mud is the first Whole Chain Game Engine officially released by Lattice in November 2022. Mud’s team, Lattice, and the Whole Chain Game pioneer Dark Forest both belong to the OxLianGuaiRC team. As the earliest Whole Chain Game Engine, Mud currently has the largest developer community. In addition to Dark Forest, it has given rise to projects like OPCraft, Sky Strife, Word3, and the recent Imminent Solace. Mud is currently the most widely used Whole Chain Game Engine.

Dojo

Dojo was born in the Starknet ecosystem and was initially developed around MUD in the Cairo language on Starknet. It was officially released in February 2023. From the words of Dojo’s core developer, tarrence.eth, we can see his enthusiasm for the Cairo language. He believes that Cairo has greater advantages in terms of proving recursion and incremental proof compared to the solidity language.

However, from the words of another core developer, Loaf, it can be seen that the reason for creating a MUD-like engine on Starknet is not because MUD is not good enough. It’s because Loaf wanted to create an ECS system on Starknet, so MUD was forked. Similarly, other Layer1/Layer2 solutions, like Move and Flow, have recently forked their own engines to develop their Whole Chain Game ecosystems. Ultimately, it is for the prosperity of the on-chain ecosystem and the choice of building infrastructure for Whole Chain Games.

The Dojo ecosystem is backed by the big IP of Loot and has also seen many impressive projects. One of them is Loot Survivor, as mentioned earlier. There are also projects like Loot Realms: Eternum, Dope Wars, and Influence that show great potential.

Just as traditional game engines play an important role in promoting the development of the gaming industry, the rise of blockchain gaming is closely related to the emergence of blockchain game engines. They allow developers to create games at a lower cost. The emergence of Mud and Dojo has fueled the development of the entire blockchain gaming industry. In May, June, and July this year, events like ETH AW hackathon, Pragma Cario 1.0 hackathon, and Lambda zkWeek hackathon provided constant nourishment to the development of blockchain gaming.

3. Blockchain Gaming Chains

In the field of dedicated gaming chains, compared to the previously popular dedicated gaming chains in Web2.5 games (not listed one by one), current blockchain gaming projects prefer to build on some general Layer2 solutions such as Arbitrum Nova, Optimism, Starknet, etc.

The main reason is that the user base of these previously gaming-focused chains consists of players who enjoy playing Web2.5 chain games and AAA-type games. Such players are not particularly interested in the relatively simple and rough content of blockchain gaming. This lack of attraction is why these so-called dedicated gaming chains do not have much appeal for blockchain gaming.

Furthermore, CaptainZ mentioned an inherent contradiction in placing all games on the blockchain: the contradiction between blockchain’s push-based nature and games’ loop-based nature.

Many blockchains are event-driven and triggered passively. The state is only updated when new transactions or operations occur. In many existing applications, many tracks align well with this framework. For example, in the DeFi track, when a user wants to trade two tokens on Uniswap, the transaction is executed after submission, and this process is event-driven. Similarly, many social platforms are event-driven. For example, when you tweet on Twitter, the tweet is published for others to see. This is also an event-driven process similar to blockchain.

However, many traditional game architectures are loop-based (except for some turn-based and asynchronous games like board games). The game system actively handles user inputs, updates game states, and renders the game world in each loop, which is called a “Game Loop” or “Tick”. Many games will require dozens or even hundreds of ticks per second to ensure the continuous progress of the game.

This causes a natural contradiction between the game’s logic and the current blockchain logic. In response to this situation, some teams have begun building dedicated chains for blockchain gaming, also known as “Ticking Chains”.

For example, the Argus team is building a new Layer2, called World Engine, based on Polaris (an EVM module compatible with Cosmos SDK). It has a pre-compiled ticking function. Curio is also building a new Layer2 based on OPStack, also with a pre-compiled ticking function.

Although they are still in the development stage, we look forward to the emergence of a brand new roll-up constructed chain specifically for blockchain gaming. We believe it will further drive the development of blockchain gaming.

4. Blockchain Game Aggregator/Publishing Platform

Lastly, let’s talk about the blockchain game aggregator and publishing platform that is still in its early stages of development. Currently, there are very few playable blockchain games available in the market, with Composable Hub’s data showing that there are no more than 30 playable games, including alpha, beta, and fully launched ones.

So, for players who are interested in blockchain games, finding them mostly relies on word of mouth and the spread within small communities. Unlike mature sectors like DeFi and GameFi that have many aggregators to help users explore and make choices, blockchain games are still lacking in this area.

Currently, there are two main platforms specifically focused on blockchain game aggregation: Composable Hub and Cartridge.

Composable Hub

Composable Hub is a blockchain game aggregation platform under Composablelabs. Composablelabs also has a Web2.5 GameFi aggregator called Klick and an NFT DEX called Lino Swap.

Currently, Composable Hub has aggregated 56 blockchain games, including 14 fully launched ones and 12 in testing phases, with 30 games still in development.

(Source: Composable Hub)

Cartridge

Cartridge is a blockchain game aggregator in the Starkware ecosystem, aiming to create a Web3 Steam. Currently, it has aggregated five games from the Starknet ecosystem: Dope Wars-Roll Your Own, Influence, Loot survivor, Briq, and Frens Land.

In addition, the Cartridge team is actively promoting the development of the Dope Wars-Roll Your Own game and is also the core contributing team to the Dojo engine.

(Source: Cartridge)

4. Key Advantages of Blockchain Games

Overall, blockchain games make gameplay fairer by storing the game’s logic, state, data, and assets on the blockchain. The use of open-source models for game contracts and accessible game clients provides extensive autonomy to third-party developers, allowing for more community-driven rules and gameplay.

This openness transforms the traditional binary relationship between game companies as providers and players as consumers into a new model where every player can become a builder and creator of games.

1. From PGC to UGC, Giving Everyone the Power to be a God

In traditional games, all the game content is provided by the company, whether it’s playing games like Honor of Kings, Genshin Impact, Fortnite, or Overwatch, we are all participants in the PGC (Professionally Generated Content) model. Of course, we have the right to create content, such as creating characters or writing fiction based on the game, achieving a certain degree of UGC (User Generated Content).

However, this type of creation does not involve the core of rules and gameplay. We can only be consumers of game rules and not makers. We are powerless when it comes to enhancing or weakening game characters, influencing game values and environmental collisions. We are still bound by the norms of Professional Generated Rules (PGR). For players who yearn to create, this is somewhat of a shackle. In the real world, disillusioned humans always long to have the power to become gods, yearning for User Generated Rules (UGR), whether it’s through novels, movies, or games.

Most traditional games are hesitant to make open-ended attempts due to considerations such as business models, security, and stability. However, we can find that some projects are starting to transition towards openness and PGR, using modding to allow other developers to create official content outside of the game. The most well-known example is Minecraft, which allows players to create and run their own game servers. Third-party developers can implement custom game modes, rules, and content, creating gameplay that is different from the original game, including Minecraft versions of games like PlayerUnknown’s Battlegrounds and even online graduation ceremonies during a pandemic.

Although Minecraft allows users to create game modes by allowing them to create multiple servers, these new servers are disconnected from each other and do not interconnect. The data accumulated by players in this gameplay cannot circulate in the servers of the new gameplay. This UGR is castrated, it is its own small universe, not a shared one.

The difference in all-chain games lies in sharing the same backend, while different mods and smart contracts only affect the frontend. This allows data to be shared and circulated in different clients.

Because of the characteristics of game logic and rules on the blockchain, and support for permissionless interoperability, all-chain games allow players to freely build and create various game features and experiences. They are not isolated from each other. This great potential for creative freedom enriches the content and functionality of games, such as trading markets, embedded games, and custom clients, making the gaming experience more diverse and achieving the transition from PGR to UGR.

This also reminds me of the virtual world of Jiuzhou collectively created by Chinese online writers Jiangnan, Jinhezai, and Dajiao more than a decade ago. They created a Jiuzhou universe through a collective weaving process, which has since expanded into industries such as literature, film, and games, forming a vast world.

In fact, if we compare it to our lives, all-chain games are similar to playing cards. Playing cards themselves only have fixed suits and numbers, but people have developed various gameplays, such as Landlord, Texas Hold’em, Tractor, Upgrade, Heart Bounce, and Golden Flower, showcasing the diversity and flexibility of game rules. All-chain games are the same. By supporting open-ended creation and interoperability, players can build various game experiences based on the basic rules. In traditional games, everyone can only be consumers of the game, but in all-chain games, people can become the makers of game rules.

In summary, the advantage of a full-chain game lies in its openness and inclusiveness, which gives players greater creativity and freedom to participate in the creation of game rules and content, forming a diverse, personalized, and vibrant game ecosystem.

2. Fairness and transparency, experiencing an unmanipulated gaming environment

Another significant advantage of a full-chain game is the transparency of its game logic and rules once they are all stored on the blockchain.

Especially for gambling and casino games, fairness and transparency are crucial.

Just like in the popular movie “Now You See Me,” the gambling apps players use are controlled by centralized companies, and all the outcomes may not be random but predetermined. For games like poker and blackjack, the opacity of game processes and states can lead to numerous players feeling cheated. This is one of the reasons why many Web2 money-related gambling games have been heavily criticized.

The transparency of the game logic and rules being stored on the blockchain in a full-chain game can ensure the openness and transparency of the rules. When combined with certain encryption technologies (such as the war-fog game “Dark Forest” and “Imminent Solace” combining ZK-SNARK), it allows for an experience of fairness that Web2 and Web2.5 games find difficult to achieve.

5. Challenges and limitations of full-chain games

With the continuous improvement of infrastructure, the wind of full-chain games has begun to blow. However, although full-chain games have some unique highlights, they still face many limitations and challenges:

1. Poor user experience

Generally speaking, players of full-chain games agree that the current playability of full-chain games is generally worse than that of Web2 and Web2.5 games. On the one hand, most current full-chain games have primitive or rough graphics. On the other hand, there are four main challenges in terms of interactive experience:

1) Difficult beginnings: Hard to match with other players

For multiplayer PVP games, it often takes four players to play together. However, due to the scarcity of full-chain game players, the number of players online at any given time is often less than ten. Combined with the lack of a matchmaking mechanism, many multiplayer games can only be played by creating rooms and inviting friends, leading to a loss of interest in the game at the beginning stage.

2) Authentic or not: High artificial barriers for some games

In addition to the game experience, many games also set multiple artificial barriers. For example, some games can only be played at specific times, some require an entrance fee before playing, and some require the purchase of certain tokens or NFTs to play, thereby increasing the cost for players to engage in the game.

Some game developers hold the spirit of independent game developers, believing that paying for games is the most genuine belief. However, independent games in Web2 still need some innovative gameplay or high-quality content to attract players.

But faced with the low replayability of most blockchain games, why would users be willing to spend money on a game that they wouldn’t even give a second glance in Web2? This reinforces the stereotypical impression that some gamers and outsiders have of blockchain games being self-indulgent. Apart from a few individual projects and believers, how many people are really willing to play? Many players are willing to play beta versions of games for the love of it, so the behavior of these project parties may discourage players.

3) Poor game experience: Frequent bugs

What players need most in blockchain games is faith, followed by patience.

From PC to mobile, games have generally been developing towards more convenient ways.

However, in blockchain games, it’s common to see a situation where several players agree to play together, but most of the time they encounter bugs. Whether it’s page refreshing or various sudden error messages, it’s difficult for impatient people to complete the full gaming experience of a blockchain game.

4) All talk, no action: Great narrative, low replayability

Currently, most game projects have a great narrative, but in reality, they have very low replayability. Most games are even harder to play than web games from ten years ago. With the improvement of infrastructure and more developers joining, we hope that the gap between the replayability of blockchain games and Web2 games can be narrowed.

2. Restrictions on game genres

Due to the current imperfect performance and infrastructure of blockchain, not all game genres are suitable for blockchain games.

From the current types of blockchain games, SLG (strategy) games are the most common. They don’t require high real-time updates and changes. On the other hand, RPG, AVG, ACT, and MOBA games require continuous and real-time updates. If all the data is stored on the blockchain, the current blockchain performance is still unable to support real-time updates. These types of games are not very suitable for blockchain games at the moment.

Currently, blockchain games mainly have two development directions. One is to take the small and beautiful route, accumulating users through playable MVP versions, such as simulation, pet raising, tower defense, and other lightweight game types. The other is to take the route of grand narrative and open world, creating an imaginative ecosystem through grand worldviews and cosmic storytelling. However, due to the limitations of game genres, it is mainly limited to the aforementioned types of games. Discovering how to create groundbreaking games like the next Axie or Stepn still requires our collective exploration.

3. Real Demand or Fake Demand

The biggest challenge and controversy facing the whole-chain gaming industry is whether the demand is real or fake.

Take the two core advantages of whole-chain gaming as an example:

1) From PGR to UGR, on the one hand, many open web2 games can achieve this, such as Minecraft. On the other hand, there is still a question mark regarding the circulation of server data in different game clients. For example, the necessity of transferring mounts, level 90 characters, and flying wings from an RPG client to a MOBA game needs to be explored.

2) Fairness and transparency are mainly reflected in the gambling games. However, on one hand, the number of players participating in online gambling is much smaller than offline gambling (only 120 million people involved in online gambling by 2023, while the number of people participating in gambling worldwide is approximately 4.2 billion per year). So, the ceiling is not high. On the other hand, for true gamblers, the convenience of withdrawing and depositing money is what they really care about. Compared to fairness, gamblers are more concerned about the speed of fund exchange, the convenience of the process, and the significant disadvantage of Web3 games due to the infrastructure of whole-chain gaming.

Regarding the two biggest features of whole-chain gaming, UGR and fairness, if there are some categories that can make good use of these two characteristics in the future, it may be able to solve the real demands of game players and attract more participation. However, at present, it still has a long way to go.

4. Completely Decentralized Games May Not Necessarily Be Fun, but Could Lead to Chaos

Just like the two sides of a coin, the other side of openness is chaos. Because of human nature, which is laziness, for players who only want to consume and not create, the most important thing is still the game’s playability, which they are used to in traditional PGR mode games.

It is difficult for game designers to hand over the game content to others. Because every user has different abilities, ordinary gamers may design games from their own perspectives, making it hard to balance the playability and fairness of the game.

Should professional game developers be responsible for professional matters, or should the rights be given to everyone? This is a very important issue to explore. How to achieve a balance between democracy and elitism is a challenge.

Therefore, for the development team of whole-chain games, it is crucial to have interesting and stable core gameplay, while leaving space for players to create and extend new gameplay. Achieving balance is essential. Otherwise, it is easy to fall into the extremes of a game being too centralized or too empty, unable to attract players to participate in the creation of new gameplay.

For the whole-chain gaming team, it is necessary to play the role of this “initial god” well, design the core gameplay of the game, and attract more players to create and enrich this game world through a reasonable incentive mechanism.

Six, Extended Thoughts on the Business Models of Blockchain Games

Lastly, let’s discuss the business models of blockchain games, which are a topic of great interest for both project creators and investors.

First, let’s analyze the business models of traditional games. The evolution of traditional electronic game business models has gone through several stages, continuously changing with the development of technology, market changes, and player demands:

1970s: Coin-operated machines were the earliest electronic games available to consumers, dating back to arcade games in the ’70s and ’80s. During this time, due to the hardware requirements for running electronic games, each game was placed in a separate physical device, including games like Pac-Man and Galaga. Players would insert coins to exchange for game time or lives.
1980s: One-time purchase. Early electronic games were predominantly console games sold through retail channels. Players would purchase physical game cartridges or discs. It was an era dominated by product sales, where players bought the game once and could play it.
Mid-1990s: Subscription-based revenue model. With the popularity of the internet, multiplayer online games began to emerge. Some game companies introduced subscription services, requiring players to pay a monthly fee to access game servers. An iconic example is “World of Warcraft.”
Mid-2000s: Advertising model + microtransactions. Free gaming models emerged, where the games themselves were offered for free, but players could purchase virtual items or in-game currency for additional perks. Additionally, some games adopted an advertising model, generating revenue through in-game ads.
Early 2010s: In-app purchases. With the widespread adoption of smartphones, mobile gaming became mainstream. In-app purchases became a primary revenue model, allowing players to buy various items within the app to unlock features or accelerate game progression.
2020s: Cloud gaming subscription model. Recently, cloud gaming has entered the public eye, allowing players to stream games from cloud servers without the need for downloads or installations. Furthermore, game subscription services like Xbox Game Pass and PlayStation Now have gained prominence, offering players access to a collection of games through subscription.

These shifts in business models reflect the constant adaptation and innovation of the electronic gaming industry in response to technology, market changes, and player demands. Likewise, the evolution of business models has, to some extent, impacted game design, development, and player experience.

With the advent of GameFi, from Axie to Stepn, the main business models include:

In-game economy: Most GameFi games establish their own economic systems, using tokens, NFTs, and in-game assets as value mediums. Players can acquire virtual assets through in-game activities, which hold value within the game and can be exchanged for real-world currency. For example, Axie Infinity, a well-known game, allows players to raise virtual creatures (Axies) that are NFTs. Players can trade and sell them, earning cryptocurrency rewards within the game.
Play-to-earn model: Players earn income by participating in games, which can be in-game currency, tokens, or other rewards with tangible value. For instance, when players join game guilds like YGG, they can earn income by participating in games like Axie Infinity, and receive incentives and loans from YGG.
Integration of DeFi and financial products: Some GameFi projects integrate DeFi elements, providing services such as loans, liquidity mining, and trading. Players can earn income or invest using DeFi products within the game. For example, in Decentraland, players can purchase virtual land and build their own structures. These lands can be used for investments or trades, with some plots appreciating in virtual value.

For early-stage blockchain games, the choice of business model is still being explored by project teams. However, based on the characteristics of blockchain games, the future of blockchain games must prioritize playability rather than DeFi. Pure Ponzi schemes are no longer attractive to experienced users.

The business model of blockchain games should better integrate its own characteristics to enhance playability. Based on the types of games, future business models can be roughly divided into three directions:

For lightweight games such as simulations and pet raising: consider using token fees with NFT+Token, free-to-play but requires LianGuaiy to become stronger.
For open-ended narrative games with high playability: if the playability is high, consider setting payment thresholds and related subscription and membership models, similar to indie games. However, in the early stages where playability is generally low, it is advisable to initially adopt a business model similar to lightweight games to attract users.
For card games: the business model can refer to the commission-based approach in traditional/offline models.

However, the entire blockchain game industry is still in the exploration and value verification stage. We also look forward to more interesting models emerging and becoming the next mass adoption.

7. Conclusion

In summary, the gaming industry has evolved from its inception to the integration with blockchain over several decades. Humans are not satisfied with being just game consumers (PGR), but also have a desire to become creators (UGR).

Just as Dota originated from the custom map community of “Warcraft III: The Frozen Throne”. The map editor allowed players to create their own maps, one of which was “Dota”. From its creation by Eul, to Guinsoo taking over the development and adding new heroes, items, and mechanics, to IceFrog introducing a series of updates and improvements to enhance game balance and depth, alongside additional heroes, skills, and tactical elements, Dota has gained wide recognition and success. Valve Corporation’s collaboration with IceFrog led to the launch of DOTA 2, which achieved huge success globally.

The map editor developers of Warcraft may not have anticipated the emergence of Dota, a globally renowned game, or the frenzy of popularity that MOBA games would bring. On the path of user creation, it often takes time and opportunity for new hit products to emerge.

Blockchain games are no different. In this current era of exploration, there are still many shortcomings such as poor user experience and low playability. To achieve mass adoption, they need to overcome the challenge of user acquisition. To attract more Web2 players, it is inevitable to address the barriers to entry into Web3, such as wallet registration, learning about purchasing NFTs and tokens, which all come with high learning costs and act as obstacles for all Dapps. Even with the simplification of game entry and funding through account abstraction and Web3’s built-in exchange, the biggest question remains: What needs of game players does blockchain gaming actually solve?

To tell a story for the sake of storytelling, and to put something on the chain just for the sake of being on the chain, is like holding a hammer and looking for a nail. How to make good use of the characteristics of UGR and fairness in the whole chain is a question that every builder of whole chain games cannot avoid. The unique characteristics of whole chain games not only provide fairness (for example, the recently launched non-whole chain game Fren Pet, if its daily roulette function is executed on the chain, it will achieve more fairness and to some extent reduce users’ impression of it being a “money game”), but also give the game a new journey from PGR to UGR, allowing every user the possibility of becoming a god.

The development of Web3 cannot bypass the wealth effect, and the essence of games cannot bypass playability. How to combine the wealth effect and playability still needs further exploration in the long run. It is hoped that continuous exploration in the track of whole chain games can truly bring about game projects that utilize the characteristics of the whole chain and solve real needs. Also, looking forward to the emergence of new universes in the open ocean of whole chain games in the future.

Lastly, I would like to express my sincere gratitude to partners such as Mr. Ni, Constance, Joven, Karvin, Yolo, Xiao Hu, Manda, Xiao Ran, Norman, Alex, Carl, Justin, Frost, Haiyu, Nico, Golem, Yafon, Gink, Robinn, and others for their assistance, as well as the patience and willingness to share from everyone during the exchange. I truly hope that all the builders in this track will continue to thrive!

We will continue to update Blocking; if you have any questions or suggestions, please contact us!

gameGameFi

Was this article helpful?

93 out of 132 found this helpful