How Cryptocurrency Is Changing Gaming

11 min




Virtual economies have always been a little strange. In-game markets in World of Warcraft, for example, are purportedly disconnected from the economies of the real world. And yet, items within these worlds do have real value. Note the massive marketplace for skins for Counter-Strike. People are willing to pay actual non-game currencies for these products, as publicized in multiple high-value item trades in the past and an on-going marketplace for items. These virtual economies are also affected by the economic forces that shape the real world. Things like inflation, runs, supply and demand and currency devaluation all take place. While gamers might be at the mercy of those running the economic show, they also have a far greater voice in how the marketplace runs. Changes to the economies of nations are not easy to make for those outside the spheres of power, but gamers can agitate for modifications within their own marketplaces and have an actual effect.

Several parallels can be drawn to the world of cryptocurrency. Just like virtual economies, cryptocurrencies are marketplaces based on the value of non-tangible items. The value comes from the agreement between two people that the coin is worth something. Therefore, it does have value. This is actually the same thing that gives currencies like the United States dollar and the Euro their value. Traders agree that they are worth so and so much money. The marketplace agrees that a certain amount of a given currency can by a given product. And as a result, this value is the “true” value of the currency. Just as in the world of gaming, the value is assigned not based on the cost of creation, but on the mutually agreed upon valuation between two people working together.

The Merger of Gaming and Cryptocurrency

Cryptocurrency is also starting to infiltrate the world of gaming economies. Because coins are easy to transfer between users and have the same value regardless of geographic reasons, international games with marketplaces open to peer-to-peer trading have begun to see value in adopting the use of cryptocurrencies in their marketplaces.

Ease of transfer is one of the unique improvements of cryptocurrencies over so-called fiat currencies, as currencies administered by governments are known. Of the many benefits touted by cryptocurrency boosters is the ease of securely transferring value between two mutually distrustful parties. The infrastructure of cryptocurrencies like Bitcoin includes a system, called the blockchain for independently and publicly holding and verifying transactions. With the infrastructure for transferring value in place as part of the currencies, users can transfer value without the need for a third party payment processor or value store like a bank.

Furthermore, cryptocurrencies like Bitcoin hold the same value regardless of the geographic region that players live in. When using fiat currencies, trading with international players can be challenging enough to be either impossible or just highly inconvenient. Chinese players want to trade in Renminbi, European players want the Euro, American players want US Dollars, Indian players want rupees and Russian players want Rubles. Through in the dozens of single-nation currencies that you’ve never even heard of (The Macedonian Denar, perhaps?) and the problem is overwhelming. Furthermore, users might not be able to easily tell whether the price in a foreign currency is the price they want to pay in their local currency. Add currency conversion fees from payment processors and it quickly becomes an unwieldy process that most players would rather avoid. This can lead to certain fiat currencies becoming the de facto standard currency in the world, and that role often falls to the stable and widely-traded United States Dollar.

Cryptocurrencies can replace that mess. By using one cryptocurrency as the official currency in-game, it’s possible to run the economy with no need for currency conversion. It simplifies the transfer and valuation process, and might even lead to fewer in-game scams on users with unfamiliar currencies. Of course, the downside is that the value of Bitcoin changes like lightning, meaning that the cost is difficult to know as a fixed value. Games can use tools in trading windows to translate the value of cryptocurrency to the users preferred local currency, and apply rules such that the value at the start of the trade is the same as the value at the end of the trade, cutting down on some dishonest users.

Gamification of Forex Trading

The trading of cryptocurrency itself is also starting to merge with gaming. Just as gaming platforms are considering adopting cryptocurrencies for trading between players, cryptocurrency trading platforms are adopting concepts from games to improve the trading experience.

Forex, or foreign exchange market, is a marketplace for trading fiat currency and cryptocurrency. At the best of times, Forex platforms have the look of a cross between a giant sudoku puzzle and the mathematics homework that nightmares are made of. So when you think about it, it lends itself particularly to concepts of gamification.

All the best Forex trading platforms offer what could be described as a game mode, where you can get involved in all the action of trading, using real-world data, but without risking any money. Of course, that means there’s nothing to lose, but it also means nothing to gain. The point is, however, that these demo accounts are a great way to learn the ropes. You can experiment with different levels of risk, and perhaps develop some Forex day trading strategies that work as well in practice as they do in theory.

Conclusion

There’s a natural crossover in demographics for cryptocurrency and gaming. The same computer nerds that love Bitcoin might also love EVE Online or World of Warcraft. So it’s natural to see the two markets trading ideas from one another. Over time, we’re sure to see more merger between cryptocurrency and gaming.

You might also like the following posts:

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How Augmented Reality is Creating a New World for Gaming




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