IT’S on everyone’s tongue. Online forums are abuzz with it. Social media is both a battleground and a display case for bragging rights about it.
Non-fungible tokens (NFTs) have been around since the mid-2010s, but only truly rose in popularity last year, when almost everyone in the digital entertainment and art industries tried to shove their arms into the same pot, expecting to reap monetary profits that ranged in the thousands, if not millions.
But what are NFTs exactly?
Not that complicated
NFTs could be anything from music, movies, to paintings or cartoons. As long as these ‘items’ are digital and are stored on a ‘blockchain’, these items are considered NFTs.
Like stocks and cryptocurrency, NFTs can rise or drop in value, and NFTs can be traded.
For example, without complicated jargon, if a person purchases an NFT of an illustration of a pig cooking another pig from the original artist, that person now owns the digital asset of that image, and the evidence of the ownership is stored on a blockchain, which is sort of a public and decentralised ledger.
If the image is popular and sought after, someone else can buy from it from the owner at a much higher price using cryptocurrency, and the ownership is then transferred through the “ledger”.
That’s ultimately NFTs at the moment, the core of which is spending an obscene monetary amount in the name of owning something “cool”, so that everyone in-the-know knows how cool you are for owning something cool, sought after and expensive.
Worlds collide
As mentioned above, NFTs only came into existence in the last decade, but another form of it existed well before the 2010s, and it was in the the world of videogames.
In videogames, gamers could purchase – if they bothered – digital skins, costumes, clothing, etc. through in-game microtransactions. These were (in most cases) purely aesthetic enhancements that would make each player’s individual avatars look unique and different from other players.
Some game companies and publishers never bothered about the inclusion of these, while others plunged headfirst into the world of microtransactions and purchaseable cosmetics, because gamers can just as exploitable as seven-year-olds, and gaming companies can be just as exploitative as gambling companies.
And therein lies the difference between existing cosmetic microtransactions and NFTs: exclusivity. This is something, in the past few months, game companies and publishers have shown major interest in adopting into videogames.
Late last year, one major videogame developer and publisher did just that.
Enter Ubisoft
In December, French multimillion dollar videogame company Ubisoft broke ranks to become the first company in the industry to incorporate NFTs into one of their videogames, Ghost Recon Breakpoint.
The developer and publisher of major IPs such as Assassin’s Creed, Splinter Cell and a multitude of other successful games aimed to be the first successful videogame company to release NFTs through blockchain technology in gaming, and yet, only a part of the previous sentence came true.
As expected, the infamous Ubisoft made a huge blunder and caught even more flak from players. The NFTs released by the company were a series of limited edition cosmetics that could be claimed in the game.
Breakpoint players criticised that in order to claim the items, they had to play anywhere from 100 to 600 hours for two of three of the limited edition cosmetics. It was also reported that two of the items weren’t even claimed by the end of the time limit for the limited offerings.
On the NFT collectors side of things, they simply had no interest in cosmetics for a video game. Recall the explanation of NFTs and their perceived “cool value” earlier in this article. Because NFT collectors weren’t frothing at their mouths like how Ubisoft expected them to, it drove the value of the Breakpoint NFTs down.
According to Apex Legends Senior Character Artist Liz Edwards, the market for the resold Breakpoint NFTs was about US$400 (RM1,672) in total.
The bad, the worse and the ugly
When news broke that videogame companies saw a future in NFTs and blockchain gaming, gamers made their voices clear on how they were largely uninterested. There was even a sprinkling of anger over the misguided priorities and goals of these companies.
The complete lack of interest and rejection by both players and NFT collectors displayed how Ubisoft’s first attempt at breaching the NFT market was dead in the water.
It should’ve been a wake up call, but it wasn’t.
In the weeks that followed after the great Breakpoint fumbling, Ubisoft CEO Yves Guillemot allegedly told Ubisoft employees: “These NFTs are just the beginning.”
The statement did not come as a surprise, as Ubisoft has been at the forefront of milking its playerbase through microtransactions of cosmetics, in-game items etc for over a decade, and the CEO of the company doubling down is to be expected.
Ubisoft, like other gaming companies, are seeking to leverage upon blockchain technology and NFTs in order to make more money, particularly to offset the slow sales of their most popular game titles.
These companies include the equally maligned Electronic Arts, Zynga and GSC Game World. The latter announced that its next S.T.A.L.K.E.R. game would have NFTs, and when players pushed back, GSC released a passive-aggressive statement on how they had to cancel the plans.
Meanwhile, major American video game and electronics retailer GameStop failed to read the room as well, and have put into motion plans to create an NFT platform or marketplace that will allow creators and publishers to list gaming-related items.
Other companies are either hesitant or completely against NFTs, such as Valve banning blockchain applications on its Steam game distribution platform, while competitor Epic Games is neither with or against NFTs and cryptocurrency, promising a more open approach instead.
As a whole, the gaming industry is rather split on NFTs, cryptocurrency and blockchain technology.
Despite how microtransactions are still viewed by the gaming community, developers and publishers have continued to push their products out, despite a wide variety of moral and ethical criticisms, such as enabling and fostering gambling addiction through lootboxes, and the exploitation of those with impulse control disorders.
By elevating the situation to NFTs, these companies retain previous criticisms from microtransaction, but will also venture into the territory of how environmentally-damaging blockchain technology and cryptocurrency is.
It is not a far-fetched observation that once one company successfully integrates NFTs, others would follow suit, regardless of whether or not non-stakeholders want it.
