Vague Patch Notes: NFTs in gaming are a bad, dumb idea

You are bad and you should feel bad.

This is going to be a little more ranty than usual. Apologies for that in advance, but… well, we’re talking about NFTs. NFTs are bad. They’re bad in every conceivable implementation, but today I want to actually narrow my focus pretty significantly and just take a look at a very simple concept: If you remove all of the bad stuff that’s swirling around cryptocurrency and NFTs and assume them as being value-neutral, what do NFTs actually have to offer the online gaming space?

The answer is nothing.

Let’s not mince words here: Even once you set aside all of the ways that NFTs and cryptocurrencies are not value-neutral but rather a harmful scam that does real tangible damage to people and systems as well as the environment itself, you’re left with something that doesn’t actually provide any solutions for gaming that don’t already exist in a significantly better fashion.

If you’re not already familiar with what an NFT is, you know what Google is and how it works, but the short version is that it’s a token encoded in the blockchain that certifies your ownership of something. This is kind of a key element to understand that kind of gets elided a lot while people are joking about how you’re paying money for a JPG; what you’re actually paying money for is the receipt that claims you own the JPG. It is, on every level, a familiar and old-school grift on multiple levels.

But again, we said we’re leaving that to one side. What can this offer to online games? Well… not much right away. Think for a moment about what ownership of an NFT means in game terms. Right now, if you play an MMO, you own a thing that is tracked on a secure network that records your ownership of access to various game content as well as certain other promotional items. This is called your account. Your Guild Wars 2 account tracks what you have access to in Guild Wars 2 and is secured by ArenaNet to ensure that no one hacks it. This is also why the game is replete with messages to not share your login details to ensure that no one else gets access to it.

Not pictured: NFTs.

(Not coincidentally, this is the exact way so many NFT cryptobros get scammed, thus proving that the blockchain is not inherently any more secure than anything else. Man, it is hard to ignore all of the ways that this is dumb for any extended period.)

But the goal here is supposed to be that NFTs are decentralized, right? Your ownership of one of these can, theoretically, transcend games! Except it totally can’t because well that’s not how coding or development actually works. And to make that clear, I’m going to create a wholly fictitious line of NFTs called Outfit Bros, which promises that you can buy one of these and have a ready-made outfit in any game that cooperates!

Except, uh… there’s no actual incentive for these various games to play along if they don’t want to. Simply owning a receipt of an image that says “you own this outfit” does not in and of itself model an outfit in a playable, implemented fashion in any sort of game.

NFT advocates often try to work around this by arguing “imagine fractionalized code,” or in other words, imagining that your NFT of this outfit does actually contain a modeled outfit for all the various games that work with Outfit Bros. But even if it did that, individual engines still need to rig the model specifically. Consider GW2 and Final Fantasy XIV for a moment; they both have wildly different equipment systems, dye systems, and animation setups. As MMO designer Raph Koster has explained at length, just having a fully modeled outfit does not allow you to drag and drop this into the game and go to town. It’s why work has to be done to port outfits from one game to another, even if they’re running on similar engines.

Oh, and this is all assuming that the companies in question will do all this modeling and rigging work for an outfit owned by one person. Multiply that by the number of NFTs out there, and imagine the workload increase as compared to the profit. There’s no actual motivation there.

“But… but imagine that weapon drops were NFTs! Imagine a world where you could sell or rent a good drop you got!” Congratulations, you’ve just recreated the real-money auction house from Diablo III, a system almost no one liked. For that matter, you have to balance the system around this nonsense to begin with. So is that “good drop” going to be something uncommon for everyone (thus making it valuable and ensuring that the buy-in for the game is obscene), or is it uncommon for me (thus meaning that most drops are utterly worthless on the market)?

Son armas para usar para herir.

Again, we run into the simple problem that the game being described using NFTs both requires technology and coding to be much more simple than it is and requires people to be invested in a game that objectively sounds kind of bad. Code is not a set of LEGO bricks. You cannot just slap bits and pieces of it together and build a functional game, art assets do not work like that, and none of that is even getting into the fact that all of these bespoke assets have to be coded into the game directly and uniquely.

So why are people pushing this? Because it’s the greater fool scam.

Here’s the simple version of the scam. Let’s say I have a rock. Just a totally ordinary, nothing special, plain grey rock. I want to use this rock to make some money. So I hatch a plan, and I sell the rock to Bree for $1000. She, in turn, sells the rock back to me for $2000. I then sell the rock to Chris for $3000, who then sells it back to me for $4000. Then, I sell Tyler the rock for $5000.

On paper, Tyler now has a rock worth $5000. What is the rock actually worth? Nothing because it’s a totally valueless rock. I created a paper trail that made it look valued and in-demand, using the item as what amounts to a hot potato wherein the last person stuck with the rock has to find someone willing to buy the rock for it to have any value. That’s the greater fool scam, finding someone willing to buy an artificially inflated property without being the last one to hold the actually valueless item.

In a centralized and regulated marketplace, of course, there are rules against this sort of grift because it’s a very straightforward and obvious scam. But once you realize that, you also realize that the whole “it’s decentralized, there’s no governing authority” thing is not actually the glowing endorsement it’s supposed to be.

So, no, NFTs are not the future of gaming. There are companies looking into them because, well… that’s a corporation’s job. If these companies smell money, they’re obligated to take a closer look. But at the end of the day, they don’t offer anything to video games that can’t be done through other means or aren’t already being done. And that is, again, ignoring all of the other ways that these things are a scam.

Special thanks are offered to both Stephen Diehl and Dan Olson, whose excellent Twitter threads helped organize my own thoughts and are a great starting point for anyone who’s interested in learning more about this particular scam. Diehl’s thread is right here, and Olson’s is here.

Also, if you would like to creep into the comments trying to defend NFTs, I will wish for earwigs to crawl into your open mouth while you sleep.

Sometimes you know exactly what’s going on with the MMO genre, and sometimes all you have are Vague Patch Notes informing you that something, somewhere, has probably been changed. Senior Reporter Eliot Lefebvre enjoys analyzing these sorts of notes and also vague elements of the genre as a whole. The potency of this analysis may be adjusted under certain circumstances.

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