Hi all,

Have you ever played a game on your laptop? Or your tablet? Or your smartphone? You're not the only one. Depending on the definition, between 2 and 3 billion people worldwide are "gamers". Mobile games alone are a market that's worth close to $100 billion per year.

Traditional games, however, can be turned off. That happened to FarmVille which used to be played by millions of Facebook users every day. On 31 December 2020, Facebook shut down the game.

That couldn't happen to blockchain-based games.

So what’s up?

We'll explain the basics of on-chain gaming, using "Pirate Nation" as an example.

• What are the challenges?

• What are the benefits?

• How does the future look like?

Let’s get started! 🤓

In recent years, there has been a lot of hype around blockchain games. We should highlight, however, that blockchains are not fast enough to support every type of game (at least for the time being). First-person shooters, for example, must be based on a different technology.

Many other types of games could be "blockchain games", but they're not all the same. Some use blockchains merely for specific aspects, such as the distribution of digital assets to represent in-game items or currencies.

You like a strategy game that requires a general for your army and gold to buy weapons? Those items can be stored on a blockchain while the gameplay uses traditional servers.

Then there are fully on-chain games like Pirate Nation (and a growing list of other titles). Every aspect of the game is run on a blockchain. The rules, i.e. the game logic, are implemented through blockchain-based smart contracts. The game state (e.g. your player name or your rank) is also stored there.

Sounds complicated? That's because it is.

Challenges for on-chain games

On-chain gaming forces developers to work under technical limitations which are different from traditional game development. For starters, blockchains are not as fast and scalable as regular gaming servers.

There has been a lot of progress though. In March, the company behind Pirate Nation announced the launch of the Proof of Play Multichain. It came just six months after Proof of Play had raised $33 million seed funding. In a nutshell, the infrastructure was built with speed and scalability in mind – allowing for millions of players.

Whether those players will all be human beings is another challenge. By design, on-chain games allow bots to play alongside 'real' players. All necessary information is publicly available. Any game may be a target for bots, especially when digital assets are available as prizes.

It's possible to limit bot activity. In Pirate Nation, for example, many actions require energy which replenishes slowly during the day. It keeps potential bot activity limited, yet it also limits potential player activity.

There are some other technical complications which have to be solved. Is it worth the effort? Proof of Play's CEO certainly thinks so:

Benefits of on-chain games

While on-chain games have to make some trade-offs, they can also benefit from the unique characteristics of blockchains.

As the entire game is on-chain and therefore public, everybody can create additional applications or build a new interface. Two players may be using Pirate Nation, but one of them could be in the setting provided by Proof of Play, the other one may use a modern-day setting where speedboats go into battle against container ships.

Overall, development is no longer limited to the company publishing the game. Everybody can create gameplay. As Amitt Mahajan puts it: "It's a return to the open and decentralized nature of the internet."

Meanwhile, on-chain game developers are pushing blockchain technology forward. Applying innovative concepts in a low-risk gaming environment is a perfect live test. Other applications, notably decentralized finance, use the same infrastructure, but store a lot more value. Such applications can then benefit from cutting-edge technology which has already proven its value.

Is on-chain gaming the future?

It's unlikely that all games will be blockchain-based next year. At the same time, there are lots of benefits for certain types of games.

Therefore it's fair to assume that on-chain gaming will be a part of the future. It may not be a complete revolution of the gaming industry, but an evolution is very likely.

Pirate Nation is a good example for what is possible, but also for the time needed. The game was first announced in April 2022, the beta version launched eight months later. Much progress has been made, but a lot of development work remains (which can be tracked on the public roadmap).

While this is just one example, the challenges for other teams are similar. However, an innovative approach in a well-established industry certainly opens up a lot of opportunities.

That’s the end for today! 😢