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Can ‘Gaming Capital Markets’ Boost Interest in Crypto Gaming?
Zynga co-founder Justin Waldron is behind the upcoming launch of the Open Game Protocol, a chain-agnostic app layer that aims to reward players of every game in every token – and reward developers with tokens too.
“We think the most important thing for players is that they get rewarded, and more importantly, that they believe in the rewards they get. And the most important thing for developers is that they get more players, and ultimately they can make a living making games,” Waldron told me in an interview.
But it’s not exactly easy for game developers – who aren’t blockchain engineers – to reward players each token is already on the market, because that means you have to buy large amounts of that token upfront and then write smart contracts to distribute it.
“For most game developers, all of those things are a non-starter,” Waldron said.
Conflicting incentives
Crypto gaming has had an identity crisis for years, as diverse genres such as narrative games and casino games are lumped together. In particular, many crypto game developers, investors, and influencers have touted the importance of “good games first.”
But perhaps they didn’t realize why anyone would play a crypto game in the first place: a player can win something of real financial value. Otherwise, big-budget games like Fortnite and League of Legends – backed by billion-dollar studios – generally offer a better gaming experience.
Some indie developers have realized that the advantage of crypto gaming is the financialization that makes it different, but we have yet to see a title break into the mainstream. This year we’ve seen casino games, hypercasual titles and “Ponzi-like” titles come and go, all trying to take advantage of a more token-forward approach.
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Marketing around crypto games has emphasized which blockchains are used, promoting them as major brands. This is often because it is the L2s themselves who do the marketing.
But the motivations and interests of L2 blockchains may actually conflict with what game developers actually need.
“Their own incentives get in the way a little bit,” Waldron told me. “They say: ‘I want to stimulate a certain type of TVL and transactions in my chain.’ So to some extent they are less attuned to the games they are working with.”
How it works
Waldron compared OG Protocol to Stripe because any game developer can get token rewards for their game as quickly as setting up credit card payments.
But there is also a community component and tokens can be staked.
“We built a system to create these reward pools so that the token communities can decide which games get how many rewards,” he said. “Instead of the games creating the assets, they are assets that link to existing games.”
Traders can support the tokens and games they like.
All of this is possible thanks to what Waldron calls “game coins,” which are tied to existing tokens. He used FARTCOIN as an example.
“The FARTCOIN game coin is not used within the games. In fact, it is a governance token that just determines where FARTCOIN rewards go. And so it is a way to speculate on how big the gaming ecosystem for FARTCOIN is going to be.”
Game developers outside of crypto could eventually use the protocol for their non-crypto games as an alternative to traditional advertising, Waldron suggested.
“It will be another way to acquire users that is cheaper and more effective than advertising,” Waldron said, adding that developers can also buy game coins and stake them against their own titles.
The OG Protocol uses Solana to start, but plans to expand to EVM chains in the future. It is incubated by ICMrun, a Solana-forward group focused on tokenization applications.