Every little boy’s (and many grown men’s) dream of earning money by playing video games is edging closer to reality. The recent release of HunterCoin and the in-development VoidSpace, games which reward players in digital currency instead of virtual princesses or gold stars point towards a future where one’s ranking on a scoreboard could possibly be rewarded in dollars, and sterling, euros and yen.
The story of the millionaire (virtual) real estate agent…
Digital currencies have been slowly gaining in maturity both in terms of their functionality and the financial infrastructure that allows them to be used as a credible option to non-virtual fiat currency. Though Bitcoin, the 1st and most well known of the crypto-currencies was created in 2009 2009 2009 there have been forms of virtual currencies found in video games for more than 15 years. 1997’s Ultima Online was the first notable attempt to incorporate a large scale virtual economy in a game. Players could collect coins by undertaking quests, battling monsters and finding treasure and spend these on armour, weapons or real estate. This was an early incarnation of a virtual currency for the reason that it existed purely within the overall game though it did mirror real life economics to the extent that the Ultima currency experienced inflation as a result of the game mechanics which ensured that there was a never ending supply of monsters to kill and therefore gold coins to collect.
Released in 1999, EverQuest took virtual currency gaming a step further, allowing players to trade virtual goods amongst themselves in-game and though it had been prohibited by the game’s designer to also sell virtual items to each other on eBay. In a real world phenomenon which was entertainingly explored in Neal Stephenson’s 2011 novel Reamde, Chinese gamers or ‘gold farmers’ were employed to play EverQuest along with other such games full-time with the purpose of gaining experience points in order to level-up their characters thereby making them more powerful and sought after. These characters would then be in love with eBay to Western gamers who have been unwilling or unable to put in the hours to level-up their own characters. In line with the calculated exchange rate of EverQuest’s currency because of real life trading that occurred Edward Castronova, Professor of Telecommunications at Indiana University and an expert in virtual currencies estimated that in 2002 EverQuest was the 77th richest country on the planet, somewhere within Russia and Bulgaria and its GDP per capita was greater than the People’s Republic of China and India.
Launched in 2003 and having reached 1 million regular users by 2014, Second Life is perhaps the most complete example of a virtual economy up to now whereby it’s virtual currency, the Linden Dollar that can be used to buy or sell in-game goods and services can be exchanged for real world currencies via market-based exchanges. There have been a recorded $3.2 billion in-game transactions of virtual goods in the a decade between 2002-13, Second Life having turn into a marketplace where players and businesses alike could actually design, promote and sell content they created. Real estate was a particularly lucrative commodity to trade, in 2006 Ailin Graef became the very first Second Life millionaire when she turned a short investment of $9.95 into over $1 million over 2.5 years through buying, selling and trading virtual real estate to other players. Examples such as for example Ailin will be the exception to the rule however, just a recorded 233 users making a lot more than $5000 in 2009 2009 from Second Life activities.
How exactly to be paid in dollars for mining asteroids…
To date, the opportunity to generate non-virtual cash in video gaming has been of secondary design, the player having to proceed through non-authorised channels to switch their virtual booty or they having to possess a degree of real life creative skill or business acumen which could be traded for cash. This may be set to improve with the advent of video games being built from the ground up around the ‘plumbing’ of recognised digital currency platforms. The approach that HunterCoin has had is to ‘gamify’ what’s usually the rather technical and automated process of creating digital currency. Unlike real life currencies which come into existence if they are printed by a Central bank, digital currencies are created by being ‘mined’ by users. The underlying source code of a specific digital currency that allows it to function is called the blockchain, an online decentralised public ledger which records all transactions and currency exchanges between individuals. Since digital currency is nothing more than intangible data it really is more susceptible to fraud than physical currency in that it is possible to duplicate a unit of currency thereby causing inflation or altering the value of a transaction after it has been made for personal gain. To ensure this will not happen the blockchain is ‘policed’ by volunteers or ‘miners’ who test the validity of each transaction that is made whereby using specialist hardware and software they make sure that data is not tampered with. This is a computerized process for miner’s software albeit an exceptionally time consuming one which involves a great deal of processing power from their computer. To reward a miner for verifying a transaction the blockchain releases a new unit of digital currency and rewards them with it as an incentive to help keep maintaining the network, thus is digital currency created. Since it may take anything from several days to years for an individual to successfully mine a coin groups of users combine their resources into a mining ‘pool’, using the joint processing power of these computers to mine coins quicker.
HunterCoin the overall game sits within this type of blockchain for a digital currency also known as HunterCoin. The act of playing the overall game replaces the automated procedure for mining digital currency and for the 1st time makes it a manual one and with no need for expensive hardware. Using strategy, time and teamwork, players venture out onto a map searching for coins and on finding some and returning safely with their base (other teams are on the market attempting to stop them and steal their coins) they can cash out their coins by depositing them to their own digital wallet, typically an app made to make and receive digital payments. 10% of the value of any coins deposited by players go to the miners maintaining HunterCoin’s blockchain plus a small percent of any coins lost whenever a player is killed and their coins dropped. While the game graphics are basic and significant rewards remember to accumulate HunterCoin can be an experiment that might be viewed as the first gaming with monetary reward built-in as a primary function.
Though still in development VoidSpace is a more polished approach towards gaming in a functioning economy. A Massively Multiplayer Online Roleplaying Game (MMORPG), VoidSpace is defined in space where players explore an ever-growing universe, mining natural resources such as asteroids and trading them for goods with other players with the purpose of building their very own galactic empire. Players will undoubtedly be rewarded for mining in DogeCoin, a far more established type of digital currency that is currently used widely for micro-payments on various social media marketing sites. DogeCoin may also be currency of in-game trade between players and the means to make in-game purchases. Like HunterCoin, DogeCoin is a legitimate and fully functioning digital currency and like HunterCoin it could be traded for both digital and real fiat currencies on exchanges like Poloniex.
The future of video gaming?
Though it is early days in terms of quality the release of HunterCoin and VoidSpace is an interesting indication of what could be the next evolution for games. MMORPG’s are currently being considered as ways to model the outbreak of epidemics as a result of how player’s reactions to an unintended plague mirrored recorded hard-to-model aspects of human behaviour to real life outbreaks. It may be surmised that eventually in-game virtual economies could be used as models to check economic theories and develop responses to massive failures predicated on observations of how players use digital currency with real value. It is also an excellent test for the functionality and potential applications of digital currencies that have the promise of moving beyond mere vehicles of exchange and into exciting areas of personal digitial ownership for example. In the mean time, players will have the means to translate hours in front of a screen into digital currency and then dollars, sterling, euros or yen.
But before you quit your day job…
… it’s worth mentioning current exchange rates. It’s estimated a player could comfortably recoup their initial registration fee of just one 1.005 HunterCoin (HUC) for joining HunterCoin the game in 1 day’s play. Currently HUC cannot be exchanged directly to USD, one must convert it right into a competent digital currency like Bitcoin. During writing the exchange rate of HUC to Bitcoin (BC) is 0.00001900 while the exchange rate of BC to USD is $384.24. 1 HUC traded to BC and to USD, before any transaction fees were taken into account would mean… $0.01 USD. This is not to say that as a player becomes more adept that they cannot grow their team of virtual CoinHunters and perhaps employ a few ‘bot’ programmes that could automatically play the game beneath the guise of another player and earn coins for them aswell but I believe it’s safe to state that at the moment even efforts like this might only realistically bring about enough change for an everyday McDonalds. Unless players are willing to submit to intrusive in-game advertising, share personal data or join a casino game such as CoinHunter that is built on the Bitcoin blockchain it really is improbable that rewards are ever apt to be a lot more than micro-payments for the casual gamer. And perhaps technical analysis is a good thing, because surely if you get paid for something it stops being a game any more?