Ishan Pandey: Hi Radoslaw, welcome to our series “Behind the Startup.” Please tell us about yourself and the story behind Hoard Exchange?
Radoslaw Zagorowicz: Hey Ishan, thank you for having me here! I’m Radoslaw Zagorowicz, the co-founder and CEO of Hoard Exchange. I graduated from Warsaw University with a master's degree in Mathematics. I’ve been active in the Ethereum ecosystem since 2014. At the beginning as a developer and now as a founder of a blockchain software house in Poland.
We are three co-founders. Mikkel Thykjær Jørgensen has a legal background. We launched Hoard Exchange in 2018 to enable true ownership of virtual assets. In video gaming, virtual items have become a $175 billion market. However, the sad reality is that gamers do not truly own the content and assets they pay for. Game developers merely give players access rather than ownership of in-game items. This is unfairly disadvantageous to gamers, especially as virtual assets now carry real-world value.
Hoard Exchange enables game developers and users to integrate in-game items with the Ethereum blockchain. We believe that enabling actual ownership of virtual items will result in greater engagement of gamers, more flexibility and functionality in development for content creators, and the expansion of the industry by attracting new market participants.
Ishan Pandey: Even though much of the latest buzz about NFTs have been focused on their potential to represent digital images, their utility extends much beyond that. Do you believe NFTs will have a large impact on other industries, such as the gaming industry? What are your views on gaming metaverse?
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Tokenized artwork, videos, and tweets selling for millions of dollars have dominated headlines in recent months. I believe what we have seen so far is just a tiny fraction of what is possible with NFTs. Beyond artwork, NFTs could be used for user verification by enterprises, event ticketing, tokenization of real-world assets, and much more.
Specifically, within the gaming industry, NFTs enable verifiable ownership of unique virtual items. People are increasingly attaching real value to virtual items. As we spend more time in the digital world, we’d want our virtual avatars to have distinct identities, styles, and persona. NFTs are the ownership layer that will be used to identify every object in the virtual environment, including our clothes, accessories, and more.
Ishan Pandey: What is the future of blockchain-based in-game items and is there an infrastructure available for the blockchain game items?
Radoslaw Zagorowicz: There are no blockchain-based gaming marketplaces built for gamers. Due to which we are building a marketplace that is the go-to place for users to buy, sell, rent, and exchange their in-game items. Users can also put their gaming assets as collateral to access liquidity. GameFi projects like Cryptokitties, ENS domain, and many others are already integrated on the Hoard Marketplace.
The Hoard platform uses NFTs minted on the Ethereum blockchain to track and identify unique in-game items. Players don’t just have a blockchain tracking their assets, but their assets have the same level of decentralized security as the Ethereum mainnet.
Ishan Pandey: Amid concerns that it was merely a gimmick, NFT sales surged by about 200 percent in the first half of 2021, compared to the same period in 2020. What has caused this unexpected surge?
Radoslaw Zagorowicz: I see three factors at play here. With celebrities, brands, and social media influencers going gaga over NFTs, the crypto-curious people have been more inclined to participate. The second factor is the rising crypto prices. NFTs are minted on the Ethereum blockchain and are often valued in Ether, quadrupling this year. Part of the wealth accumulated from rising prices found its way into the NFT market. Third and the obvious one is the COVID-19 pandemic, which forced people to spend more time at home and online.
Ishan Pandey: Non-fungible tokens (NFTs) are individual pieces of crypto that contribute to the vast amounts of climate-warming carbon pollution emitted by the cryptocurrency used to buy and exchange them. What are your thoughts on the detrimental environmental impact of NFTs?
Radoslaw Zagorowicz: The carbon footprint of NFTs and the broader blockchain ecosystem has been a major concern. NFTs rely on the Ethereum blockchain, which currently uses a Proof of Work consensus mechanism, similar to Bitcoin. It involves mining operations that consume much electricity.
We can’t say with precision what percentage of Ethereum’s carbon emissions can be attributed to NFTs. However, there is no denying that minting NFTs is contributing to carbon emissions. Thankfully, Ethereum is switching to ETH 2.0 in just a few months. It will do away with mining and reduce carbon emissions by more than 99%. So, NFTs and the rest of the Ethereum ecosystem will become much more environmentally friendly.
Ishan Pandey: There are currently empty stadiums worldwide with only athletes competing in various leagues or championships in various sports. As a result, what impact, in your perspective, has the COVID-19 pandemic played in the rise of online gaming among millennials?
Radoslaw Zagorowicz: The COVID-19 pandemic and the subsequent social distancing norms forced billions of people to stay indoors. People had plenty of time to connect over the Internet, rekindle their hobbies, and explore new things.
The pandemic accelerated many trends, including online gaming. People found new ways to engage with their favorite teams and players. The stadiums were empty, but fans went crazy for NBA Top Shot NFTs. Humans have an innate desire to experience fun, thrill, and adventure. The pandemic cannot suppress what makes us inherently human. When we could not go to the stadiums, we turned to online gaming to have similar experiences from the comfort of our homes.
Ishan Pandey: A non-fungible token (NFT) celebrating Andy Murray’s 2013 Wimbledon triumph recently sold for $177,777, according to the auction platform. Do you believe the sports and gaming industries are becoming more accepting of cryptocurrencies?
Radoslaw Zagorowicz: Yes, the sports and gaming industries are more inclined than ever before towards cryptocurrencies and NFTs. Look at the major sports leagues such as the NBA, NHL, NFL, and others. They are all selling NFTs of merchandise, video clips, and unique experiences.
The San Jose Sharks will start accepting crypto payments for season tickets, suite leases, and partnerships starting the next season. The NBA’s Dallas Mavericks and Sacramento Kings have already embraced crypto. We can clearly see the trend.
Ishan Pandey: How do you think the advent of blockchain gaming will affect the existing gaming business, and do you think this will lead to widespread blockchain adoption? What are the most pressing concerns confronting the gaming industry today, and how may blockchain-based gaming help to address them?
Radoslaw Zagorowicz: The gaming industry has never hesitated to embrace new technologies and deliver novel experiences to players. We are still in the early days of blockchain gaming. Players spend hundreds of billions of dollars on games and in-game assets, but they don’t own what they paid for.
With blockchain gaming, players will truly own the items they purchase and be rewarded for being part of the ecosystem. Staking, lending, and borrowing of in-game assets will unlock new monetization opportunities for gamers. It also means that players will be more engaged with their favorite games.
Once the gaming sector embraces blockchain, we will see mass adoption of blockchain in general. That is because the gaming industry is massive, and most players are young. The younger generation is more open to new technologies.
Ishan Pandey: According to Ethereum creator Vitalik Buterin, the most critical improvement to the Ethereum blockchain since 2015, which went into effect very recently, the network is well-positioned to make an even more significant improvement to minimize its energy usage by 99 percent. Can you tell us a little bit more about this recent upgrade and what it means for the Ethereum ecosystem?
Radoslaw Zagorowicz: Ethereum 2.0 has been in the works for almost six years, and I’m glad it’s finally arriving. Once the transition is complete, the Ethereum network will switch from the Proof of Work to the Proof of Stake consensus mechanism. Staking will put an end to the energy-intensive mining operations once and for all. It will reduce carbon emissions, decrease gas fees, and boost transaction speed to thousands of transactions per second from just around 15 TPS today.
Given the considerable carbon footprint of Bitcoin and Ethereum, it is good for both the society and the environment that the world’s second-largest blockchain is reducing emissions by more than 99%.
Ishan Pandey: What new trends are we going to witness within the gaming ecosystem, especially in the post-covid-19 era?
Radoslaw Zagorowicz: I see a couple of exciting trends playing out in the gaming industry. First, gamers will be able to seamlessly take their virtual assets from one game to another or transfer their assets between two games developed by the same company. Second, people will get more immersed in the metaverse games. Snoop Dogg’s partnership with The Sandbox is a fine example. The legendary artist is building his own virtual mansion in the metaverse game where players could have unique experiences, attend live concerts, and do much more via their avatars.
Disclaimer: The purpose of this article is to remove informational asymmetry existing today in our digital markets by performing due diligence by asking the right questions and equipping readers with better opinions to make informed decisions. The material does not constitute any investment, financial, or legal advice. Please do your research before investing in any digital assets or tokens, etc. The writer does not have any vested interest in the company.
This article is part of The Gaming Metaverse Writing Contest hosted by HackerNoon in partnership with The Sandbox.
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