Gamers are feeling some kind of way about blockchain technology. They came out in furious force when major game studios like Square Enix, Zynga, and Ubisoft announced plans to incorporate NFTs into new titles. The argument is that these cryptocurrencies and blockchain assets are Ponzi schemes for the digital world, and still actually haven’t proven they’ve got legs.

But there’s simply a lot of misconception and misunderstanding about what the value of an NFT is, which is why sales pitches aren’t sitting well with gamers, said Mike Wagner, CEO of Star Atlas, during a GamesBeat and Facebook Gaming Summit.

“A lot of people are perceiving this right now as essentially a cash grab, a way to create some quick revenue with no follow-up, which just isn’t reality,” he said. “What it’s going to take is a lot more education and understanding from the community.”

Wagner was joined by Miko Matsumura, general partner at gumi Cryptos Capital, to talk about blockchain and what’s really in it for gamers, the ways blockchain and NFTs are rocking the gaming world, and what we can expect for the future of blockchain games like Star Atlas, and the metaverse.

Evil crypto vs. crypto for good

Matsumura pointed out that much of the crypto world is still the wild west, filled with weird crypto projects that don’t represent the kind of innovations that developers and investors are trying to launch.

“Let’s separate the builders and the people delivering triple-A quality gaming and things from people who really are just setting up a shop and doing some money laundering or whatever it is they’re doing, whatever unsavory activities,” he said. “In order for us to be answering to this community, it’s important for us to acknowledge that yeah, there’s a lot of bad crypto out there. It doesn’t mean that there isn’t any good crypto. That’s what I want to underline.”

Right now, we’re starting to see the emergence of these crypto-native IP franchises that are evergreen, community-driven, and gamer-centric, Matsumura said. It’s becoming part of celebrity and influencer culture, and brands are getting on board, and the crypto world is slowly demystifying.

“We’re starting to see this merger between popular culture and blockchain, crypto, and most importantly gamer culture,” he added.

In fact, we’re living in a world now where Eminem has changed his Twitter profile picture to his Bored Ape Yacht Club NTF purchase. He spent 123.45 in etherium, or $461,868.42 in real dollars. Bored Ape Yacht Club, an NFT project, similar to Cryptopunks, the OG NFT project that was launched in late 2017, recently announced they were teaming up with Animoca to get into the play-to-earn video game space, launching in Q2 of 2022.

“We saw mainstream artists, musicians, composers, all coming into the space to create some new concept and sell some new product,” Wagner said. “It’s a representation of self across social media, which in its own right is a nascent version of what the metaverse will ultimately become.”

How blockchain cements player centricity

With Star Atlas, a triple-A-quality video game with both traditional core game and blockchain mechanics, Wagner and co is trying to change the narrative around blockchain and NFTs for gamers, arguing that blockchain is ultimately about gamer-centricity, and putting gamers in the driver’s seat. They heavily focus on utility-driven NFTs, or assets you can purchase that are not only collectible, but offer in-game benefits and also true monetization potential, Wagner said. Players can earn one of two native digital currencies — ATLAS, the medium of exchange across the entire economy, or POLIS tokens — which give players a stake in the Star Atlas DAO.

“What’s critical for us is forming a robust and sustainable circular economy,” Wagner said. “It can’t be purely extractive-based. It can’t be just these emissions of tokens through play-to-earn that ultimately have no utility, nowhere to go. How do we create experiences that other people want to participate in that we as a team don’t have to develop? That’s what we’re focused on, building this tool set, building this platform, and enabling people all over the world to create within this new universe.”

There’s an idea of history and durability built into blockchain, and that’s a value proposition for gamers, Matsumura said. The thing that’s so interesting about the creation of durable IP franchises owned and controlled by the players is that the blockchain is a consensus history recording device, he said. Players can essentially become legendary parts of the history of a game, and it can be commemorated in an indelible way.

“To me, the idea of player centricity is enhanced by blockchain,” he said. “The NFT as a historical artifact. It’s part of the legend of both the player, the entire environment, and the game itself. Those are the types of things that blockchain can uniquely add that I think gamers should think about.”

The core value prop for gamers

For Wagner, the core value proposition remains true asset ownership, or the sharing economy, which includes the gamer in the value creation.

“To me, NFTs have a tremendous amount of value,” he said. “Players can then take that asset, sell it later, sell it peer-to-peer, trade it with someone else, barter with it, that’s all value. Being able to monetize the time you spend in a game, that’s something that’s never been possible before. I’ve spent thousands of hours in MMOs I played over time, and what I got out of it was the entertainment value. That was really enjoyable at the time I was spending it, but if you can add that additional benefit of being able to also capture some value, capture some income, that’s fantastic.”

The revenue models of traditional studios are extraction-based — it’s a unidirectional flow of capital. But blockchain creates open economies that players can participate in, in many different capacities, he said.

“To me one of the greatest advantages is being able to tap into this new financial ecosystem that is crypto, and bringing people in through gaming, is one of the most expeditious approaches to getting people exposed to crypto in general,” he said. “Obviously we’re heavily focused on gaming as the primary application in the Star Atlas metaverse, and I do believe this will bring people in. They’ll start to get informed. They’ll educate themselves on the benefit of this new financial ecosystem. I don’t think there’s any turning back once they get exposed to it. It’s the red pill. Once you’re in, you’re in.”

The game is basically democratizing the economic metagame of participation and turning players into owners, Matsumura said.

“That feels gamer-centric,” he said. “That feels like a real desirable aspiration. Maybe it’s not for everyone, but I feel like there’s nothing wrong with wanting that for players.”

The revenge of the nerds

“To me, one of the biggest sales points of the emergence of blockchain, NFT, and in fact this financialization of gaming is the idea that the gamers can have a revenge of the nerds,” Matsumura said. “And what I mean to say by this is, what becomes so important is that the fiscal and monetary power that’s given to the gamer is really part of how we win.”

The story of creator versus corporation is prevalent in NFTs and in blockchain gaming, Wagner added, but creators are now able to bypass all these middlemen that they’ve typically had to operate through to be able to sell things, like their art for example. Now that they’re able to sell their product directly, they’re capturing the revenue that used to get siphoned off.

“We’re more focused on being the creator,” he said. “Yes, we’re a corporate organization as well, but ultimately it’s being a creator and then turning that over to the people who are participating.”