How the gaming sector can benefit from blockchain

Gaming Potential For Blockchain As Real Adoption:
Undoubtedly, blockchain is still on the look-out for its mass adoption, a perfect use-case that can set its path to becoming a usable technology adopted by wide users. Many think a digital form of currency can be the one but all hopes of adoption by the financial institution have shuttered and faces tough regulations from governments each year.

Blockchain technology has a very broad scope in different areas and sectors, such as IoT, Manufacturing, and Medical industry supply-chain management. However, none of these sectors have come up to this date as a leading success story for how blockchain can be implemented with full buy-in and mass adoption.

Gaming shows potential as a real adoption for blockchain:

Gaming, as a global phenomenon generates each year revenue of $110 Billion and is growing rapidly. It is also a sector that is run by people who are technologically inclined and predominantly younger. Blockchain does need that bit of persona to target for early adoption.

As anyone who has played many of the most popular games will know, the demand for gaming virtual items is substantial. Many players are addicted to the notion of advancing in the game.
Over time, players build their characters and collect in-game items. Some such items may have been obtained through months of gameplay, involving various tasks and a substantial level of effort.

Some cases of how seriously people consider virtual items in the gaming world:

1. In South Korea, where the number of computer game players is massive, some have reported the emergence of gangs and mafia. Powerful players steal and demand that beginners give them virtual money for their “protection”.
2. A Japanese woman was charged after destroying data belonging to her “husband” in the popular game Maple Story. She faces up to five years in jail or a fine of more than £3,000 for manipulating electronic data.
3. In China, Qiu Chengwei was sentenced to life in prison after stabbing and killing fellow gamer Zhu Caoyuan. In the game, Qiu had lent Zhu a powerful sword, which Zhu then went on to sell on eBay for 7,200 Yuan (about £473 or US$870).

Items from gaming like characters/ power-ups have gained monetary value in the real world. eBay, along with specialist trading sites, have allowed players to sell their virtual items. This has attracted fraudulent sales, money laundering, phishing attacks as well as theft. Also, the games database contains thousands of credit card details and are frequently targeted by hackers.

In addition, the game industry is plagued with fraudulent downloads. It is estimated that for every legitimate virtual item sold and downloaded, there are 7.5 virtual item downloads lost to fraud. This number can be much higher in some countries — in China. For example, there are 273 fraudulent virtual items downloaded for every legitimate item. This means a staggering 50–99 percent of all virtual good purchases are illegitimate. You can imagine how much revenue could have been generated if there were no such fraudulent downloads.

Watch out, there are thieves:

1. According to a new report, popular smartphone games such as “Clash of Clans” are being used to launder hundreds of thousands of dollars on behalf of credit card thieves.
2. In 2015, it was reported that Steam, the world’s most popular online store for PC games, had around 77,000 of its accounts hijacked.
3. Online message boards for games like World of Warcraft, Final Fantasy XIV and League of Legends are littered with stories from users who have had their accounts, virtual items stolen.
   

Therefore, given the huge size and challenges which we mentioned above, gaming does show potential for blockchain industry. Here are all ways how the use of blockchain can resolve problems for the gaming industry to protect players and game makers interest.

How blockchain can help the gaming sector to solve these issues and reach its potential:

1 | Making payment processing secure:

The game database contains thousands of credit card details. Players are worried about the protection of this information. With Blockchain, gamers can keep their debit or credit cards away. No matter how small payment is, this technology offers a decentralized method for it. There is no way for a scammer to steal information or manipulate.

2 | Minimizing fraudulent downloads:

The gaming industry suffers the maximum hit of online fraud downloads. Blockchain can save billions by eradicating every chance of fraud. For each successful purchase or download, buyers public-key record (will be used for download) is saved in the decentralized database.

When the player opens the app, they input associated private-key to unlock and enjoy gaming. This acts as an individual user licensing. No way hackers can tamper with this database to add fake accounts.

3 | Storage safety and security:

Storing data online seems a risk for game companies and players. Data stored with encryption makes it impossible for hackers to target an individual account as they can’t guess the private-keys.

4 | Safe trading of virtual items:

• Trading sites for virtual items are frequently targeted by hackers and have weaker security than a shopping site or online bank. The use of blockchain can create a decentralized marketplace where items can be traded safely and securely.
• Each virtual item earned in the game can be associated with the owner’s public-key (works like an ownership right). This will enable items to be traded in the platform or trade ownership, only when the owner approves the trade with its private key.
• Smart contracts will add a security layer where virtual items can be permanently locked in the individual account or could exchange the ownership right when needed.

Gaming apps have the potential for Blockchain use and can help to transform traditional business models to bring enhanced security, transparency, and reduced costs.