Are We Back?
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Game tokens are pumping, studios are jumping on the NFT bandwagon, and it seems as though the gaming side of crypto twitter just woke up. With all of this excitement, it is important to keep one’s cool while wading through the news and rumors:
- Roblox rumors ignited CT, but celebration were premature
- ImmutableX’s BD machine scores a Ubisoft partnership
- Netflix expanded its gaming vision
- Yuga and ME launched a marketplace, but the segment remains tough
- Tokens pumped and influencers feuded
- Bots may be used to defraud people in skills based games
Let’s dive in!
Roblox Rumors Spark Premature Excitement
Twitter was buzzing last week with clips of Roblox’s David Baszucki talking about the Elton John NFT “dream”. The example that was given was taken by many in the web3 space as validation of the technology and a sign that NFTs are coming to Roblox.
However, as Decrypt’s Kate Irwin quickly pointed out, this was nothing but speculation. There has been nothing officially announced by the company, but then again their spokespeople were not exactly denying it either.
Baszucki’s response is a welcome sign, as not too long ago Valve’s team, when asked about the technology, was a lot more dismissive. However, given the speculative nature of CT’s rumor mill, it is prudent to be cautious and not take wishful thinking as facts.
Ubisoft Will Give Web3 Another Shot
On the other hand, there was a major traditional gaming company that jumped on the web3 bandwagon. Ubisoft is renewing its efforts in the space. The company took a pause after unfortunate previous trials, including the Quartz project.
This is a big win for ImmutableX and the web3 space as a whole, as it serves as major validation for the technology in the gaming industry. Nevertheless, the scope and focus of the partnership is unclear.
ImmutableX continues to develop its technology stack and trial it with inhouse developed titles. For instance, Gods Unchained will be migrating to Passport. It will be interesting to see if ImmutableX will be able to get Ubisoft to at least partially adopt it.
Netflix’s Game Vision Grows Bolder
Some of you may be tired of reading about Netflix here, but I think this may be a major up and coming player in the industry. It boasts a rare combination of proprietary and licensed IP, an existing distribution channel, and the need to offer quality games.
A recent LinkedIn post from Engie DeVora, suggests that Netflix is building an inhouse AAA studio to offer games to its subscribers with no ads or microtransactions. The last bit is particularly interesting as it will be a major differentiator, especially for free to play games.
While everyone from Blizzard to Epic Games and Valve is trying to get gamers to spend more money through micro transactions, Netflix looks inclined to roll everything into its subscription price tag. This has the potential to make waves in the industry.
Yuga and ME Tackle the Difficult Marketplace Sector
The new Magic Eden ETH marketplace will differentiate through enforcing creator royalties. The announcement came at an interesting time, as the NFT market appears to be waking up a bit. Nevertheless, the space remains a difficult one to find success in.
Not too long ago, it was disclosed that Coatue Management marked down the value of its OpenSea investment by 90%, as a stark reminder that even the leaders in this sector face challenges.
Marketplaces are trying to find themselves looking for focus between art, gaming and launchpads offerings. Yuga and ME may be well positioned for all three, but looking at Epic Games’ example in the traditional space shows that being profitable may still be difficult.
Tokens Pump and Tempers Flare
Gaming tokens spent the past week in a sea of green as recently launched coins from the likes of BigTime and Shrapnel joined long time trading assets for some jubilant market activity. This has prompted much talk and disagreement on twitter.
Gaming influencers in web3 are garnering more interest, but the talk has switched from dissecting gameplay to disagreements about top coin prospects and status flexes. We may see toxicity levels rise as content creators readjust to the changing atmosphere.
For gaming teams the recent run up has prompted roadmap shakeups. Studios are looking to fast forward token launches as many see the recent market activity as a sign of opportune times ahead. We may see a new gaming token season soon.
Bots as Adversaries
Typically, when we think of adversarial bots, we think of technologies that help players cheat the game studio and gain an unfair advantage. Teams have spent an enormous amount of time and money trying to prevent this.
However, it seems that it is conceivable for studios to use bots against gamers in skills based games. The recent allegations against AviaGames suggest that is a possibility, and it is unclear how gamers could detect and protect themselves against this.
The scenario, true or not, highlights the challenges with trust based designs in gaming. Web3 technologies can help address these shortcomings and help better align incentives with gamer needs.
This wraps it up for this entry. As always, if you are working on something exciting in the web3 gaming space, or are a traditional gaming team looking to explore the possibilities, don’t hesitate to reach out to any of us at Sanctor Capital. Have a great rest of your week!
Ilya Abugov (@AbugovIlya)
Disclaimer: This commentary is not investment advice. It does not purport to include any recommendation as to any particular investment, transaction or investment strategy, or any recommendation to buy or sell any investment. It does not reflect any attempt to effect any transactions or render any investment advice.
This post is solely for informational and entertainment purposes. It is inherently limited and does not purport to be a complete discussion of the issues presented or the risks involved. Readers should seek their own independent legal, tax, accounting, and investment advice from professional advisors. The views reflected in this commentary are subject to change at any time without notice.
