Gaming And DeFi: A Powerful Crypto Combination
Over the last few weeks, I wrote a number of articles centered around gaming and the virtual economy. In my mind, this is a very powerful force that is being unleashed on the world. The future of humanity could be altered by this one change. Giving people the ability to get rewarded by playing games and to own assets that are theirs outside the game while carrying value is enormous.
At the same time, Decentralized Finance (DeFi) is making a lot of news. On the Ethereum blockchain, it is reported that more than $1 billion is staked in DeFi accounts. Compared to the existing financial market, this is a drop in the bucket. However, a billion dollars is still a lot of money for an industry that is so young.
When we look at powerful, exponential change, especially within the technological realm, convergence is often a force that takes things to an entirely new level. One technology can make great changes; two is even better. When the two are combine, 1 + 1 can often equal 5.
It is possible we see this same situation with gaming and DeFi.
Imagine for a second that you could purchase a lottery ticket, have a chance to win the prize, and still get your money back after the drawing. This would certain change the lottery system.
That is already possible. Pooltogether is a lottery game that does exactly what I described. It combines the use of DeFi to enhance the gaming system. One puts up money, which earns interest, is able to win the weekly prize, and withdraw the money in full.
Obviously, we know there were some issues with the DeFi system. Maker went through a period where people were questioning that platform after a deep drop in the price of the token. So, obviously, this is not without risk at this point. There are still some things likely to be ironed out.
Nevertheless, consider the possibilities with gaming.
One of the most powerful aspects of blockchain games is the ability to buy in game assets and own them. What if we took this one step further and added the ability to get one's money back while still retaining the asset.
In addition, the development team for the game could solve another problem: funding for ongoing development. Games often get stale simply because the developers do not have the money to keep moving forward. This solves that problem.
So how would this look?
A game could be set up using the DeFi system. Players could buy their existing gaming assets the same as they do now. However, instead of simply paying and being done with it, the money in the DeFi system earns interests. When all the players purchases are pooled together, the development team uses the combined interest for ongoing advancement of the game.
The players retain ownership of their digital assets and are free to use them as they see fit. Ownership is achieved as soon as the transaction takes place. A time stipulation might have to be placed on the DeFi money to keep the system liquid. For example, the money might need to stay in the pool for 1 year before a user can withdraw it.
Consider the potential when these two are combined. All parties will benefit to a much greater degree than we presently see.
Obviously, development can be accelerated and ongoing as the funds are available for this purpose. Start ups often have a tough time getting going without access to funds. A DeFi system will provide the funds while the players can have confidence in their money being secure.
From the players' perspective, this is a major win. Over time, it is likely that the money will keep being rolled into more assets as one can take the funds out. This will, naturally, require more development to keep advancing the game. Since this is already paid for, the total fund of a popular game is likely to explode as more users delve into the deeper levels.
This all created a nice circular cycle where the interest helps to feed everyone in the system. Unlike now where rent seekers take the interest, under this scenario it is effectively "community" owned. The money goes to development which further advances the game which, in turn, should increase the value of the entire entity, including the digital assets the players were acquiring.
Each aspect of the community has incentive to keep moving forward. As long as more digital assets are created which enhance the player's experience in the game, money will keep flowing in. Of course, the developers have incentive to keep developing these assets and adding more layers to the game since it draws in more money, which generates more interest, thus paying them more.
We can only imagine what type of money we are talking about with a game that has 5-10 million players.
It certainly created very interesting possibilities.
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Posted Using LeoFinance
