Last week, throngs of people descended upon NYC to attend NFT.NYC, the largest NFT conference. The best word to describe the experience is “spectacle.” It was difficult to even walk around (or leave) the conference as mobs of people still very interested in NFTs roamed around for free mints, swag, and talks. Public spreadsheets (another) with events abound. Consumer interest is undeniably still high.
Plenty of ink has already been spilled on NFT.NYC hot takes so I’m going to focus on gaming-specific observations after attending 40+ gaming-related events and demos:
Games have the potential to be the second major utility for NFTs
NFT game producers are community managers now
NFT games are more complex than they need to be
1) Games have the potential to be the second major utility for NFTs
This conference and its satellite events confirmed that access is the primary and only generally-accepted utility for NFTs so far. The meta game at NFT.NYC was trying to figure out what closed networking events and exclusive parties to go to. And the most exclusive parties were open only to holders and their guests. This tracks how other exclusive events (parties, festivals) have used NFT for access, with Coachella’s lifetime passes as a newsworthy example.
Games have the potential to be the second major utility for NFTs because of 1) consumer interest (mixed, controversial) and 2) significant investment.
Consumer interest: A study of 1,500 console and PC gamers found that 56% of them are interested in earning NFTs through gaming, according to market research firm Interpret. There are tons of news articles, mainly based on anecdotes from gamers or game studios pulling statements supporting or mentioning NFTs, that mention gamers hating NFTs. Recently, the “gamers hate NFTs” message is louder due to market sentiment and rug pulls but I encourage you to consider the other side of this argument by asking players yourself.
Significant investment: Before the bear market, numerous NFTs generated significant capital from mints or investments. Meanwhile, the top blockchains all have either game-only funds or general funds that include games as a top use case (Please let me know if I’m missing anything):
Polygon gaming fund, $100MM, July 2021
Avalanche general fund, $200MM, November 2021
Solana gaming fund, $150MM, Dec 2021, $100MM for Korean web3 startups with a focus on games, June 2022
Flow general fund, $725MM, May 2022
Immutable X gaming fund, $500M, June 2022
This is a significant amount of funding waiting for the right projects. It’s hard to conceive that we will not see at least one hit coming from billions of investments in web3 games.
2) NFT game producers are community managers now
Community management in games focuses on what happens to a player outside of the game (digital and IRL). And since most projects don’t have games launched or have a not fun game launched, many folks working on the game better get good at community management fast. Historically, community engagement has been complex and unsatisfactory in web2. The community manager usually ends up being the [insert other functions] manager too. But now I see a lot more game producers ending up as community managers, not by choice, especially if they have done a mint before shipping the game.
In web3, some teams think that hiring some Discord mods or temporarily event staff are sufficient. It’s not. Discords with founding teams deliberately trying to avoid community management seem to have more toxic communities than those with active founding teams who answer tough questions (wen game?). The IRL example is sending the proper staff to support a major event like NYC.NFT.
The most glaring example of crappy community management, and I won’t name names explicitly, is when I went to an event for a game launch and I couldn’t find anyone working on the game. Twenty minutes later, a guy shows up (let’s call him Bob) and tells me to create an account on an exchange so I could play the game, which is sketchy, but I did it anyways, and it still didn’t work. He started to take screenshots of my errors and slacked his teammates for help. I found out that Bob was hired two days ago to help with this event and that the founders / core employees of the game didn’t even attend this event. That was the most extreme example, but after speaking to many NYC.NFT attendees, botched gaming community events seem to be the norm. At least I got a t-shirt though…
3) NFT games are more complex than they need to be
Just like the Defi geniuses who brought us Terra/LUNA, mysterious 20% yields, and crypto hedge funds like 3AC, there a bunch of self-proclaimed experts/economists/tokenomists in GameFi who are hellbent on figuring out how to have future players hold the bag. I do believe that there is a role for GameFi in the future, but in the short-term, web3 games should focus on two things:
Making memorable experiences (aka fun, h/t Hermann Peterscheck)
Build enough of an audience and by extension attention so that entities other than only other players will pay
The game demos I tried were always trying to explain some deep game design / tokenomics concept to the average consumer: multiple tokens (some tradable), burning mechanisms, new NFT mints, decaying NFTs (think horses, characters), royalty fees, DAOs, how much can players play without buying one of the aforementioned tokens, etc. The most hardcore of players per genre would like these things and if the outcome of web3 games is that you have highly monetized but small communities (tens of thousands), then so be it. But I see web3 games gaining a much broader audience which parallels the mainstream adoption of NFTs.
When in doubt, KISS…