WAX: Tokenization and Use of Smart Contracts in Gaming Industry Are Inevitable
Videogames are amongst the most rapidly developing markets of our time. The multi-billion eSports industry has already attracted such giants as ESPN and Disney. The audience of eSports events is expected to reach 600 million people in a few years.
Computer games are no longer a hobby for schoolchildren who spend a lot of time and their parents’ money on playing online; it is now a respectable pursuit for people of very different backgrounds and ages. A professional eSports player can make a fortune and a reputation now.
With the emergence of cryptocurrencies, gamers have obtained one more tool for monetizing their virtual efforts. While in-game coins are questionable in terms of real-life acceptance, bitcoin feels free at Steam, a major gaming platform. It is considered among the most convenient ways to pay.
The market of virtual assets, where players buy and sell in-game objects for real money has surfaced only recently. There have been several attempts to blockchainize this functionality, however, a major success is still out there. Creating a fully functional decentralized market requires a vast user base and a considerable supply.
One of the world’s biggest centralized marketplaces for virtual items, OPSkins, has been voicing its intent to introduce blockchain in its operation on several occasions. For that purpose, they create a new platform dubbed WAX (Worldwide Asset eXchange). ForkLog contacted Malcolm Cassel, the CEO of WAX, to find out should we expect that the project could overcome the conservative momentum in the industry and launch the inevitable process of all-in tokenization.
ForkLog: Hi! A quite obvious question first: are there many gamers on your team? What games do you play?
Malcolm Cassel: OPSkins was created by gamers in the first place to solve gamers’ problems. Our team first started collecting gold in the WoW, then we became veterans in CS:GO, DOTA2 and Team Fortress. Now, PUBG is also on the list.
FL: Is your platform something you personally would be waiting for?
Malcolm Cassel: These days, we’re the biggest player on the market, and we’re well aware that the industry is distributed across thousands of local platforms, thus creating a considerable disbalance between the demand and the supply. We’re planning to solve this issue once and for all by creating a global platform for virtual assets accessible from anywhere in the world and offering the full list of all items available for sale in real time. Such a network, being inexpensive and reliable, would improve the pricing mechanism, and enhance the market’s liquidity and expansion.
FL: For those who aren’t that into computer games, why do we need such third-party services? Why can’t game developers provide the gamers with all necessary means for trading?
Malcolm Cassel: The gaming industry is a giant with market cap over $100 billion, but it’s still young and hasn’t tapped all possible markets yet. The market of virtual goods trading is one of such markets, especially when it involves transactions with real-life money. Gamers have to rely upon centralized markets controlled by a third party. The seller sells their virtual goods to the intermediary who then finds the buyer and then sends the seller their reward. OPSkins uses the same model as well.
A healthy game economy requires secondary markets. It’s like buying a house: just imagine you can’t ever sell a house once you’ve bought it. I believe lots of people would have refused to buy expensive real estate knowing they’ll have to live there forever with no chance of moving elsewhere.
FL: What are the basic shortcomings of centralized platforms? How can blockchain solve all those problems?
Malcolm Cassel: Centralized markets are just expensive, and ensuring security is another pain in the neck. Considering the market consists of thousands of payments systems, each of which has its own shortcomings, the industry becomes chaotic and repulses lots of potential users
Decentralized services, on the other hand, aren’t easy to launch. Without an API, one can’t standardize the trading of assets from different games. WAX uses blockchain to decentralized the existing market of OPSkins, and moves the trading to the p2p model. We use smart contracts to certify the honesty of all transactions. Sellers would easily create their stores and even choose who to trade with.
FL: You’ve decided to call your nodes ‘guilds’ and pegged each of them to a particular game or server. What’s that all about?
Malcolm Cassel: People are social creatures. Notwithstanding any anonymity offered by the internet, multiplayer games are based on social aspects of gaming. One can go through a certain fraction of an MPG on their own, but important episodes require group action. Some groups gather for a short while, for instance to do in a boss. However, there are long-term groups called guilds or clans. Those groups are for like-minded people who move towards the same in-game goal together.
We decided it would be reasonable to use the same model in WAX. Guilds on the platform would vote for games they wish to support. Users will choose which guilds to join. Each game can be supported by an unlimited number of guilds provided there’s a demand. WAX won’t dictate which games to support. It’s up to the community to decide.
FL: Do you expect blockchain to change the face of gaming? How fast can it happen?
Malcolm Cassel: eSports is a perfect match for tokenization. We’re confident that tokenization and utilization of smart contracts in gaming aren’t just possible, they’re inevitable. Some experts believe that all in-game transactions would use cryptocurrency in the future. But why can’t we use bitcoin or ethereum for that purpose? The answer is that both of them don’t fit the specific demands of the videogames market.
The gaming industry is more about microtransactions. In bitcoin and ethereum, transactions take a long time and are quite expensive. Second, we shouldn’t forget about some technological control. Bitcoin is governed by user consensus and we can’t predict the way it would change in the future. Ethereum is controlled by Ethereum Foundation. WAX needs technological independence to create a blockchain that meets all demands of the market.