Virtual items can be extremely valuable.
To provide some perspective, the highest price ever paid for a virtual item was $6 million for Planet Calypso from the game Entropia, and there is a long list of other virtual items from various games that have sold for thousands of dollars.
One recent example and success story is CryptoKitties, which has sold several virtual items for over $100,000.
CryptoKitties aren’t just cute little pictures of cats. They are non-fungible tokens managed, protected, and authenticated by Ethereum’s blockchain.
A non-fungible token is like a certificate of authenticity and proof of ownership, except unlike paper documents, it’s impossible to forge.
Blockchain completely redefines the value of virtual items and turns them into a new class of digital assets, thanks to four key properties unique to collectibles stored on a blockchain: transparency, immutability, security, and decentralization.
Transparency means the scarcity of an item is proven. So, if you want to find out how many copies of your item lie on the blockchain, you can visit a blockchain explorer like Enjin X and easily see for yourself.
Immutability creates a unique, publicly visible historical log of items. An item’s past is trackable, meaning you can visit Enjin X and confirm it was used by your favorite pro gamer. You can see what it was previously purchased for and how popular it has been. Immutability gives your virtual item a backstory.
Security of blockchain technology is second to none, especially that of Ethereum’s blockchain, which is the most decentralized and contains the most nodes. Arguably, Ethereum is the most secure database in the world, and its protection covers the storage, transfer, and management of items.
Decentralization means items are not stored in a central location governed by a single authority. Items created on the blockchain aren’t stuck inside gaming servers, so users won’t lose access to those items by losing access to a game. A decentralized database provides items full control and sovereignty over their assets when stored on a blockchain. With user-friendly apps like the Enjin Smart Wallet, users carry their items in their pocket and still find them available after entering games the items belong to.
Thus, the concept of true ownership over digital assets are introduced.
This is the reason there are people willing to pay $140,000 for a picture of an adorable kitten — because it’s proven to be rare, it has an interesting history, you’re not likely to lose it, and it truly belongs to you.
Enjin Coin (ENJ) created the first coding for a non-fungible token and helped CryptoKitties implement it into their game. The resulting code became known as the now famous ERC-721 protocol.
But the code for Enjin’s smart contract is now much more advanced.
Enjin will soon release their Unity Software Development Kit (SDK), which will enable any of the 4.5 million game developers using Unity to leverage the power of the blockchain and create their own blockchain-backed collectibles. These collectibles will be available for use in games made for Android, iOS, PlayStation, Xbox, Nintendo, Windows, Oculus Rift, Google Cardboard, Facebook Games, and many more.
The SDK will enable forward-thinking developers who use the Unity game engine to fund their upcoming projects by issuing early release collectibles, monetize their economy by constantly creating new collectibles, and make a commission off third-party sales of collectibles.
Enjin’s next generation smart contracts provide several unique features to developers, but our open platform will allow developers to select and use the parts of it they like and add code over and above what is provided. There are no limitations, just possibilities.
Key features include, but are not limited to:
- Value Backed by Enjin Coin: Gamers can often be wary of investing in virtual items, especially during a game’s pre-sale. By backing collectibles with Enjin Coin, developers can guarantee their value. This will help build the items’ intrinsic and ongoing trade value while also reassuring buyers and encouraging them to invest in collectibles.
- Taxing Secondary Markets: The SDK will enable game developers to set up secondary marketplaces both within and outside of their games where they can earn a percentage of all player-to-player sales. This can also have a viral marketing effect, as they are giving players a powerful financial motivator to promote and advertise the game’s digital assets.
- Regulating Third-Party Markets: The SDK enables developers to regulate third-party markets by selecting specific locations in which collectibles can be bought and sold. By enabling specific third-party websites to promote and sell their items, developers will be able to earn a commission from sales and gain extra exposure for their game.
- Creating Taxable Rental Markets: By enabling players to rent out their collectibles, developers can earn a percentage of the rental fees. This feature will be added in future updates of the SDK.
- Cashing in for Crypto: Developers will be able to set an exchange rate for players to cash in items for their Enjin Coin-backed value, and, in turn, receive a portion of that cryptocurrency back into their own wallet.
Collectibles can be used in fundraising pre-sales and as an ongoing monetization strategy. With our Unity SDK, developers can create digital assets before they have even built their game, enabling them to reward supporters instantly by delivering rare, valuable, or discounted in-game assets. Players can hold these assets securely in their Enjin Smart Wallet for later use when the game is released.
Developers can also use collectibles to mobilize their community and create incentive to promote their game. By providing influencers and publications with digital assets to use, customize, give away, or sell, developers will create a powerful motivator to push their products, helping solidify their gamer base even before launch.
Players that receive a pre-release digital asset are likely to use it and try out the game, especially if they paid for it. Developers will be able to generate revenue by taxing a portion of each sale and receiving the profits automatically.
The ability to create collectibles on the blockchain, back their value, bring in ongoing revenue from peer-to-peer trades, gain repeat business from rental markets and more will soon be available at the click of a mouse. No coding required.
This will be an absolute game changer for crypto and gaming combined. There is no use-case more ready to be utilized and no suite of tools more powerful or user-friendly.
If you’re a game developer looking to harness the full power of the blockchain it might be worth looking into Enjin’s solutions? They connect game developers with blockchain developers to help facilitate innovation in both industries.
You can drop the team a line here.
Disclosure: Enjin is a preferred gaming partner of The Crypto Collectors. We support their blockchain solutions as we find them safe and reliable. At the time of writing we hold no ENJ coins as investment.
About the Author:
Co-Founder of The Crypto Collectors — Host of #BlockchainChat — PR/New Media Specialist and Advisor, Adel de Meyer works with blockchain businesses with a focus in gaming, decentralized marketplaces, privacy and collectibles.