Do NFT games depend on the cryptocurrency market?

Non-fungible tokens (NFTs) have received more attention due to the popularity of games using them as in-game assets.

NFTs such as Cryptokitties allow users to own game assets and can be used in multiple games at the same time, but does this mean that NFTs are reliant on the market? And will the market tank if less popular games stop using them?

 

True Ownership with NFT Games

The concept of true ownership is an important one to understand when building game items with non-fungible tokens. With Ethereum and ERC721, developers can create unique digital assets that belong in a specific person’s wallet.

These assets are owned by a single individual and don’t have to be sold or traded with other people. This is why non-fungible tokens are becoming increasingly popular for blockchain gaming—they allow for more advanced virtual goods that players can own them forever.

In many ways, they represent actual ownership because they exist in a single place. While it might not be feasible to create an entire game around non-fungible tokens, it’s certainly possible to use them as components within larger projects.

With no need for trust between users: When using something like Bitcoin, you need to trust another user (or institution) will send you coins in return. You also need to trust that someone won't spend your coins without your permission while they're still in their possession.

However, with NFTs, these concerns are completely removed from the equation since you can only hold 1 token at any given time.

 

What do we mean by dependence?

Determining how cryptocurrencies and crypto-related items will fare within blockchain-based video games comes down to supply and demand. There are three primary crypto tokens that gamers commonly use: Ether, Enjin Coins (ENJ), and ERC-20 tokens.

While you can play blockchain-based video games with any of these coins, ENJ is intended for game interaction; it's directly tied to game accounts, so if you have ENJ in your account, it doesn't mean anything outside of that specific game.

Ether is a digital currency and not associated with any particular game, but because many blockchain games rely on Ethereum smart contracts to keep things running smoothly (and generate their own tokens), a sharp rise or fall in its value could affect gameplay as well.

ERC-20 tokens, which were created using Ethereum’s protocol, can be used across multiple games—so they're a bit more stable than other options. If you hold one of these types of currencies and see an influx in price over time, it might be worth holding onto them to see what happens!

 

How dependent are NFT games on the cryptocurrency market?

To answer that question, let’s look at some of 2018’s biggest (by revenue) games: CryptoKitties, War Riders, Tron Dogs, and Gods Unchained. For brevity’s sake, we won’t include many other successful projects like Enjin Coin or Open sea.

It’s important to note that all these projects use different approaches to game mechanics. Some are very simple while others are more complex. However, they all have one thing in common – they are not directly dependent on any one cryptocurrency but rather use a variety of cryptocurrencies as their in-game currency.

This is an important distinction because it allows players to play their favorite games without having to worry about which token will do well or poorly in terms of price fluctuations. The value of each token is fixed by its smart contract so players can be sure that if they buy something for 100 tokens today, it will still cost 100 tokens tomorrow.

This may seem obvious but if you think about it for a second you realize how rare such stable systems are – especially in gaming where most items tend to lose value over time due to inflationary mechanisms built into them.

 

Why cryptocurrencies may be a boon to gaming

Today, there are over 60 games that use non-fungible tokens (NFTs) to offer unique digital items. Non-fungible tokens can represent any number of assets. The majority of these assets are based on popular video game brands and in some cases resemble video game avatars as well.

However, it is becoming more common for these non-fungible assets to be related to cryptocurrencies and tokens. For example, several companies have released digital collectibles for top cryptocurrencies such as Bitcoin (BTC), Ether (ETH), Zcash (ZEC), and Monero (XMR).

It’s a safe bet that we will see even more crypto-collectibles in 2019 given how far blockchain technology has come and where it is heading from here. To find out if your favorite NFT game relies on cryptocurrencies, simply look at their website or other marketing materials.

If you don’t see anything about crypto-based assets or transactions then you know that your favorite game does not rely on it just yet. However, many NFT games do mention cryptos so be sure to check before investing your time and money into a new virtual item collection!

The pros and cons of gaming with cryptos: As stated above, there are many benefits to using non-fungible tokens when playing games online.

Cryptocurrencies allow users to easily buy rare digital goods without having to pay outrageous fees associated with credit card purchases or having access to an international bank account.

 

Conclusion

Crypto-collectibles are played by investors of all types. There is a growing community of crypto-collectors in Singapore, Australia, Hong Kong, and other countries.

The exchange rate of cryptocurrencies is not a factor in whether they play or not because they use altcoins that they already own to buy CryptoKitties. These gamers do not seem to be affected by exchange rates and enjoy buying and selling CryptoKitties just for fun.

They have been playing these games since 2017 and have made some profits from them. They also believe that CryptoKitties will continue to grow in popularity as more people learn about them through word of mouth.

As more people become aware of these collectible digital assets, they will likely become one of the most popular collectibles available online today.