THE FUTURE OF CRYPO IN ESPORTS
In 2008, the first application of blockchain was introduced to the world through Bitcoin. As expected, Cryptocurrency blew the internets and caught many people’s interests. Today, Crypto has become among the leading technologies that have transformed many sectors such as insurance, banking, logistics, and banking. The most recent development is its inclusion in the gaming industry.
This evolving technology has become a global phenomenon surrounded by doubts and critics. Most of the concerns raised against this revolutionary technology are the uncertainty of traditional financial systems. The meteoric rise of Cryptocurrency has ensued a wave of institutional adoption by startups, small business enterprises and even giant companies in the market.
Economists have projected a surge in the crypto industry as institutional money penetrates the market. They are still more hope that Crypto will be included in the Nasdaq listing, which will help to boost the credibility of blockchains and promote their use as reliable alternative means of payment. Financial experts are pushing to ensure Crypto acquires a verified ETF (exchange-traded fund) to make it simpler for people to invest in Crypto.
There is no doubt that Cryptocurrency is the next big thing. Investors, organizations, and financial institutions are adopting new amendments that encourage crypto transactions. For instance, PayPal offers users a chance to leverage their crypto holdings to make payments to online merchants around the world. This is a clear indication that Cryptocurrency is already impacting business operations. Additionally, the administrative and regulatory bodies are speeding up to speed up the enforcement of crypto activities in the virtual currency industry. This positive attitude from all relevant parties dictates that the future for the cryptocurrency market is promising. Just recently, the Indian Supreme Court overturned its initial ban on crypto operations, and many countries have followed suit.
In the simplest definition, eSport refers to competitive video gaming organized by virtual gamers. Video gamers converge online to compete with each other while viewers watch from the comfort of their homes. The event has attracted advertisers and sponsors, and clearly, we can see the increase in prizes awarded to winners. Some of the most common eSport games that attract high viewership include counter-strike, madden NFL, league of legends, and call of duty.
The first esports event was hosted by Stanford University in 1972. The winner of this event was awarded a freed and one-year free subscription to Rolling Stone magazine. Since this first event, esports has evolved from free beers and become a billion-dollar giant industry. In 2018, the value of exports was estimated at around $1 billion and was expected to rise to $1.6 billion by 2023. This signifies an average annual growth rate of 15%. Additionally, viewership is also expected to hit 645 million views. In 2020, the eSport attracted over 495 million viewers from around the world. But what really contributes to this sudden surge in viewership and revenues? Your guess is as good as mine. As expected, the tremendous growth of eSports is attributed to sponsorships from market heavyweights.
Although other players like IBM and Marvel Entertainment play a significant role in making the event a success, BMW is the current flagship sponsor. This trend is projected to intensify in the coming years attracting new monetization strategies. The flourishing of the audience has also helped to grow eSports and include Women based Esports.
Although eSports is not a new entry into the market, it is evident that these two spaces (eSport and Cryptocurrency) complement each other. Financial experts have cited that Cryptocurrency will make eSport payments better and much easier.
Using Crypto in Gaming
Crypto complements gaming in the following ways:
- Offers payment Alternatives
Most viewers are unable to stream video games because their payment option is not available. Paying for video games through Crypto has made it more convenient for and easier for members without credit/debit cards to enjoy viewership and stake at eSport matches. One major advantage of Crypto payments is their anonymity. Individuals who do not want to be known or exposed may consider this payment method. Viewers can join a crypto casino, make deposits and stream the event online or through their television.
- Offers transparency
Every gamer fears losing his stake through manipulation. Gamblers have always raised this concern when staking on games. Cryptocurrencies offer a ledger that is immutable. This implies that it stores information permanently and cannot be deleted, making it difficult to manipulate outcomes. Hacking blockchains requires the hacker to control over half of the nodes on the network, which is seemingly impossible. The action is also recorded on the network hence allowing fans to follow the game in real-time.
Hackers have a way of manipulating modern technology to access fan’s data. However, with Cryptocurrency games, fans are able to decide what they want to reveal to the public and what they want to remain anonymous. Gamers and fans can no longer worry about their personal data leaking into unauthorized third parties. Unlike credit cards, you can hide your location.
Building Trust among Developers and Contractors
There are many cases of developers who have been conned through the normal payment system. Many developers have filed complaints of not being paid after successfully completing THE job. Blockchain offers an excellent platform for video game developers to interact in real-time with their clients. The transparency of cryptocurrencies makes game developers and players more comfortable and willing to take the game to greater heights.
Most virtual gaming sites are not regulated by Malta Financial Services Authority or the UK’s Gambling Commission. These sites rarely provide intelligence on the process of selecting winners and the number of winnings awarded to players. It could be a scam. With blockchain currency, there is no need for regulators as crypto technology allows players and fans to see the activities of their money in real-time.
If gamers make deposits through bank transfers, debit cards or wire transfers, the bank can trace the source of their money and question any unusual activities suspected in the account. However, with crypt, gamers deposit funds in their wallet ID and stake their preferred matches without being audited. Your source of money will not be questioned.
Cryptocurrencies have made it easier for gamers and fans to make purchases without seeking approval from thirds parties like banks. Games can purchase game collectables instantly and stake them.
Available eSport Cryptocurrencies In Esports
Blockchain technology has surprisingly gained fast popularity in the eSport industry. Most clubs have begun to implement transaction solutions based on this technology to help engage and monetize their fan base. By now, several blockchain applications have opened up new innovations for collecting revenues. Let’s look at some of these applications and how they have been used in the eSport industry.
- Fan Tokens
FIAT currencies, including pounds, euros, and dollars, can be used to purchase fan tokens. These fan tokens allow fans to interact with their favourite players and earn discounts. Fan tokens seek to offer fans access and influence over some decisions that their favourite gamers and sports teams often make. They also enjoy VIP rewards and other special promotions.
NFTs refer to unique digital assets that are often preserved in a certain blockchain. They represent various intangible and tangible assets such as collectable sports highlights, digital art, and virtual real estate. NFTs verification authenticity is a key attraction feature to this blockchain technology. Dapper Lab is a perfect example of blockchain companies that have created NFT applications in the gaming industry, i.e. NBA Top Shot.
So rare is another example of NFT applications used in the gaming industry. This global fantasy league has partnered with top football clubs such as real Madrid, Paris Saint Germain, Liverpool FC, among many others.
The newest NFT entry in the market is Tom Brady’s platform called Autograph. This application collaborates with top athletes and gamers to offer potentially real-life experiences and digital collectables. The manning legacy collection is another NFT entry in the market that seeks to offer digital artwork collectables. Through this application, fans enjoy the virtual meet and greet, autographed memorabilia, and physical artworks as well.
Decentralized Esport Ecosystems
A report by Newzoo predicts that eSport viewership will surpass the 557 million mark by the end of 2021, signifying a growth rate of 14%. Cryptocurrencies provide a single yet robust system that brings gamers, fans, advertisers, sponsors, media, and team managers together. This ecosystem seeks to eliminate potential complexities or intermediaries, which allows easy transfer of funds, media rights or players through smart contract programs that the blockchain technology has programmed.
There is no doubt that the relationship between cryptocurrencies and esports has resulted in lucrative transactions and innovations that have helped both industries grow. However, growth comes with risks, and the future of this relationship is not exceptional from risks that may arise from uncertain regulatory and legal authorities. The significant infusion of capital in the industry will likely attract federal regulatory involvement and tax implications.
Evidently, Crypto’s flexible nature has helped to boost the growth of digital sports. These innovations have helped to unlock new revenue streams, promote engagement of fans and improve return on investments for sponsors.