NFT discourse isn’t about NFTs

Here’s what frustrates me about the discourse around NFTs in games: it’s not actually about NFTs.

We’ve already had, for a long time, digital marketplaces for artificially-scarce virtual goods. There are many games where players can buy, sell, and trade their in-game goods, but to prevent counterfeiting and fraud the players need to go through a central server to do so. If the server is down or inaccessible you can’t do any of this, and if there’s real money involved the publisher-or-whoever takes a cut to pay for that server. Moving a system like this to an NFT-backed one would allow players to trade directly with each other regardless of central server availability and without needing to subsidize its maintenance.

This was a decently-well-known possibility for years, but no big publisher implemented it, because while it would have improved the player experience, it would have cut off a revenue stream. Taking a cut of every transaction pays far more than just the associated maintenance costs and can actually be the main way these games make money. No publisher is going to just give that away.

So when NFTs did catch on with publishers, it wasn’t for valid and player-friendly use cases in games where it made sense. It was for illegitimate cash-grab bullshit forced into games where it didn’t fit at all, or as the basis of a scam or pyramid scheme. And when those started getting big is when most people first heard the term “NFT”, and so it’s what they associate it with.

Players rightly deride these schemes, but this derision is now associated with terms like “NFT” and “blockchain” because the bad use cases are the only ones most people have encountered. So now if a game comes along with a good NFT use case (such as a digital trading card game that uses NFTs to make cards into unique and distinct entities that can be upgraded, traded, and sold player-to-player), it has an uphill battle because for most players it will be lumped in with the bad use cases and dismissed as just another scummy NFT game.

The problem was never the NFTs. The problem was the short-sighted player-hostile money-grabbing. But since that’s how a lot of people were introduced to NFTs, the conceptual well was poisoned. Once it gets in that state, the problem is self-reinforcing, because player-friendly publishers will mostly want to avoid tarnishing their games with this reputation, while player-hostile ones with nothing to lose will keep pushing for the player-hostile revenue streams.