Letter from Square Enix President Indicates Potential Interest in NFTs

Non Fungible Tokens or NFTs for short were a-buzz in 2021. Following on from the cryptocurrency boom of last decade, there is an ambition towards it being the next step towards a theoretical “metaverse”, decentralised gaming, real ownership of assets/artwork in the blockchain, or any number of other things. But while there could be a place for it in the future, at the moment, it is more about trading (from my perspective) exorbitant sums of money for a link to an image, which may be valuable in the future when used in tandem with projects that have barely left concept stage yet. With a trading boom now, I cannot blame anyone for wanting to take the chance at flipping NFTs for real-world profit should they have the funds, but until we see an actual concept come to fruition as a final product – I would not personally take a risk.

But whether it is just a short-lived fad or the next big-thing in gaming, gaming publishers are getting on-board with it, albeit with mixed results. Ubisoft, for example, recently dipped their toes in the water with Tom Clancy’s Ghost Recon Breakpoint, with the estimated uptake likely well below expectations.

The basic and elemental technologies to enable blockchain games already exist, and there has been an increase in the societal literacy and acceptance of crypto assets in the past few years. We will keep a close eye on societal shifts in this space while listening to the many groups of users that populate it, and ramp up our efforts to develop a business accordingly, with an eye to potentially issuing our own tokens in the future.

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The advent of NFTs using blockchain technology significantly increased the liquidity of digital goods, enabling the trading of a variety of such goods at high prices and sparking conversations the world over. I see 2021 not only as “Metaverse: Year One,” but also as “NFTs: Year One” given that it was a year in which NFTs were met with a great deal of enthusiasm by a rapidly expanding user base. However, we do observe examples here and there of overheated trading in NFT-based digital goods with somewhat speculative overtones, regardless of the observed value of the content provided This, obviously, is not an ideal situation, but I expect to see an eventual right-sizing in digital goods deals as they become more commonplace among the general public, with the value of each available content corrected to their true estimated worth, and I look for them to become as familiar as dealings in physical goods.

Square Enix appears to be the next coming that MAY be looking at implementing NFTs into a future project or existing projects. This comes from a New Year’s Letter from President Yosuke Matsuda. While many have taken this as a definite thing they would be looking into, I would err on the side of caution on thinking that. Namely, this letter is evidently aimed more at corporate investors than gamers, so dropping statements about NFTs and the Metaverse which investors would see as a money making opportunity may be more aligned to responding to that.

I encourage you to read the full article above and make your own opinion on it. Personally, the idea of having NFTs implemented into any game at this point would be very risky, due to the risks of:

a) Alienating players due to the barrier of entry and increased instances of gaming being more about making money than having fun

b) Having a negative impact on the environment and

c) A risk of making communities more toxic and have more controversies around it. Especially if they are added into online games such as Final Fantasy XIV, which has had a very heavy emphasis on not being pay-to-win, items being fairly static and been heavy-handed on RMT.

Of course, I don’t trade in NFTs or have much stake in this area of technology outside of some colleagues and friends investing in them. So I could very well be wrong about my perspective, but I don’t see how the middle-of-the-line gaming experience would be greatly enriched by them.

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