Understanding the NFT Gaming Craze

Last updated: 12/31/2023
5 minutes read

Non-fungible tokens (NFTs) permeated into the gaming industry towards the end of 2021 — and there’s no sign of it looking back. Within this guide to NFT gaming, we’ll explain what NFTs mean, how they operate, and how they might enhance the gaming experience.

We will also list some of the most popular NFT gaming titles acting as the road testers of the NFT gaming concept.

What Does NFT Mean in Gaming?

An NFT is a form of cryptocurrency, but it differs from the likes of Bitcoin and Ethereum due to its lack of fungibility. Unlike Bitcoin, where one unit of BTC can be bought and sold for another, NFTs represent ownership of an underlying asset.

The first example of an overlap between NFTs and gaming occurred when the Ethereum-based blockchain game CryptoKitties launched NFTs for their players to earn and trade.

These NFTs equated to ownership of unique images of cartoon cats that could be exchanged and sold.

Since then, the gaming industry has allowed NFT gaming to proliferate, creating a new play-to-earn gaming model. Gamers can play and earn unique in-game assets and items that can be used, sold, or exchanged for other in-game assets.

It could be anything from new characters or weapons to new levels or maps. However you earn these gaming NFT assets, each NFT gives you exclusive ownership rights over them while they’re in your hands.

What is NFT in gaming: 5 interesting facts

1. NFTs give gamers even greater control than microtransactions

Video gamers have long been accustomed to purchasing in-game items and accessories via microtransactions. NFTs are the next generation of microtransactions, handing gamers even greater power with the ability to buy and exchange assets or even earn a percentage from future resales. The NFT marketplace could inspire enthusiasts of video game franchises to create unofficial NFT-powered assets such as fan art and external projects inspired by in-game storylines.

2. NFT gaming provides a unique gateway to cryptocurrency

The rise of NFT gaming is simultaneously raising awareness of the power of blockchain technology and cryptocurrencies. Aleksander Leonard Larsen, co-founder of the hugely popular NFT gaming title Axie Infinity, said that half of its active player base had never traded cryptocurrency before engaging with the play-to-earn model.

3. NFTs are focusing on interoperability

Perhaps the biggest idea for NFT gaming and video game publishers is the concept of the interoperability of NFTs. Tokens housed within a "local" blockchain of gamers actively playing within the same franchise will be able to transfer NFTs and enhance earlier or future releases with exclusive in-game assets compatible with an entire series.

4. NFT gaming collectibles are already on the rise

Video game publishers are already working hard to devise collectible NFTs that long-time fans of gaming franchises can invest in as rare pieces of gaming history. It could be retro MIDI-style game sounds or game art, or even physical memorabilia like paintings, figurines, and statues. Anything that celebrates a video game’s lifespan. For example, Capcom opted to create NFT trading cards of iconic Street Fighter characters, including the likes of Dhalsim and Ryu.

5. NFTs can bring fanatics even closer to their favorite games

NFTs in the latest video and online games are designed to bring gaming enthusiasts closer than ever to their favorite franchises. NFTs will help to reward the loyalty of long-time players, with rewards and access to unique events and releases regardless of whether the NFT’s value rises or falls.

NFT has the same meaning in gaming, standing for Non Fungible Token

How do NFT games make money?

Although some NFT gaming is available in a free-to-play format, the majority will ask you to purchase a starter pack or pay to unlock further in-game levels. As we’ve already mentioned about the interoperability of NFTs in games within franchises, publishers will hope to make continued income from gamers that can utilize NFTs in past and future releases.

Examples of the best gaming NFT titles so far

Want to learn which play-to-earn titles are taking over the NFT gaming scene in 2022, and beyond? Here is our hit-list of five of the best NFT-focused games across a range of genres to get your teeth stuck into.

1. Axie Infinity

This game was the starting point for NFT gaming. A role-playing game based on monster breeding. Your task is to bring up your own pet Axie and breed it to foster generations of Axie creatures. With each generation, they will inherit at least one trait from their forefathers. Axies can also be collected and exchanged in the Axie Infinity NFT marketplace in the same way as Pokemon or Digimon.

2. Gods Unchained

Gods Unchained is right at the top of the card fighter genre. It’s a free-to-play PVP card battle game with NFTs that are tradable and collectible. Players can earn "GODS tokens", which can also be used to improve NFTs or unlock new rare NFTs.

3. Battle Racers

Battle Racers is one of the most popular blockchain-based action-strategy games, whereby players can create, build and race NFT cars on weird and wacky race tracks. It’s your challenge to put together the best possible battle race car, with weaponry and parts that can be bought, traded, and tweaked to help you overcome your opponents and finish first across the line.

4. The Sandbox

The Sandbox is considered by many to be the "Minecraft of NFT gaming". Built within the Metaverse, players have the freedom to design and build their own environments and even sell and trade their own digital assets as NFTs. Although aesthetically it resembles something like Minecraft, the freedom of The Sandbox’s game mode puts this on a whole new level.

5. Splinterlands

Hearthstone fans will find glaring similarities between this and Splinterlands. Like Gods Unchained, this is another classic card battle game, featuring the NFT mechanics of collecting and trading assets. Each card has its own attributes and status, with some rarer than others. Conquering battles and quests unlock the potential to earn additional NFTs.

NFTs in Gaming usually mean users can buy in-game goods with tokens instead of real money

Should You Try NFTs?

There you have it. NFT gaming is big business. Looking at Axie Infinity alone, its in-game NFTs are said to be worth upwards of $2.26 billion, according to DappRadar.

Now that you’re familiar with NFTs in gaming terms, you can try these play-to-earn games out for size on your own terms.

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