Tech talks: Making the case for NFTs in gaming

Just as with many things in the betting industry, we can be slow to adopt as we’re sometimes innovation averse. However, with the advent of NFTs, and indeed the world of the metaverse, we’re now on the cusp of some very exciting developments in the industry.

So, let’s dive into NFTs – otherwise known as non-fungible tokens. In effect, they give digital ownership rights to a created visual product, stored forever on the blockchain’s distributed ledger.

Many of you will know of the famous ‘Bored Ape’ NFT that went viral – so how does a portrait of a sad primate translate into real ‘use-case’ applications for the gaming world?

It’s actually quite simple and virtuals will provide a great starting platform to take us through this. Let’s look at virtual horseracing – you buy your own NFT horse (let’s say, for a couple of hundred dollars), which will be bred from two previous ‘NFT horses’ that are from Seabiscuit-levels of NFT horsing pedigree – which then becomes your own horse and can be entered into virtual races.

With a baseline of certain outcomes and unique strengths of the horse via its ‘virtual bloodstock’, you’ll then be able to enter it into any of our virtual races of choice, and in turn, compete against other NFT horses.

This may sound far-fetched, but it’s really not – what we’re in effect doing is taking the model that has worked so well for Fortnite, with custom players, characters and skins, and doing the same thing for customised horses that you can then enter for virtual races – with a whole new level of trust compared to backing a randomly generated horse. Want to provide a new platform of engagement for new demographics to get excited by virtuals? You’ve got it.

The American Dream

The US is going to prove a massive driver of demand for this, given the extent that the media and sports betting world are so much more strongly merged.

NFTs in the NBA are already out in full force, and of today’s cursory Google search, LeBron fans now purchase the exclusive rights for a LeBron James Slam Dunk.gif for up to $200,000 – and there’s no shortage of takers.

Apply this to in-play sports content, for example, and we’ve got the same logic of art and a fan collectible. Take a betting-based marketing campaign stateside which offers one camera, one exclusive shot and one original .gif or image as a prize or part of an in-game jackpot, and you’ll have no shortage of takers (and some very busy in-play traders!).

Aside from fan engagement as part of a marketing campaign, there’s also another strong niche that can be filled, one which we’re currently seeing from the likes of fan tokens with Barcelona, Juventus and Roma.

In effect, you’re leaning on the crowdsourcing model whereby you’re giving fans a share in the club’s narrative and direction, while raising money – and without having to part with any ownership of shares.

This NFT-form of fan ownership is proving massively popular, and as demand increases for this limited supply of NFTs, basic economics will dictate that prices will begin to rise. Again, something that could even be repeated for launching a crowdsourced fantasy sports platform or even a betting site.

As we’ve already touched on, these have three core appeals to the gaming world. We’ve already covered NFTs for virtuals, fan-based tokens as part of the sports betting narrative, and third, casino.

Take Zynga, for example, and its fantastic bulldog logo – turn that into a ‘Golden Bulldog’ NFT players can win as a collectible, and you’ve instantly got demand as the bulldog is a key part of what resonates with fans of the brand.

Even better, you can also make them instantly redeemable with casino tokens and suddenly you’ve got a cross-over to land-based. Tie that in with, say, a Vegas casino with boutique stores in the hotel and that NFT can be used for equivalent cash value.

Converging worlds

Hopefully, by taking a step back from the hype, we’ve been able to distil three key ‘use-cases’ for NFTs in the gaming world, in a way that can be merged and applied to provide benefit.

At the end of the day, we need to remember that media, sports and betting are merging as one form of digital entertainment.

Just like artists have done with a digital stamp for art, which I predict is going to become an incredibly strong proposition as part of the sporting, and indeed, betting narrative. The proposition for it is just too strong – in effect you’re providing a tangible asset of both financial value and also a piece of the brand they resonate so much with.

I’ll leave you with one more scenario. Let’s take our good friends Yolo Group. They sponsor Arsenal, and let’s imagine a giveaway/win one piece of exclusive digital art of Arsenal celebrating their (likely) Champions League return this year. Who wouldn’t want ownership of that if you’re both a sports fan and betting with a Yolo-owned betting brand?

This is going to be a fantastic channel for engaging betting fans, and we are only going to be limited by our creativity.

As an engagement specialist, I believe this will prove to be a massive asset for operators. Yes, there is a massive amount of hype around NFTs right now, but we need to look beyond the viral parts of it and distil it into the ways it can engage and excite in our industry. As we’ve discussed here, I believe there are plenty!

Alex Kornilov is the CEO and founder of Betegy. Betegy provides global betting operators and media outlets with analytics and data visualisation by generating instant, high-quality personalised content using machine learning. Betegy’s clients include the likes of ESPN, Yahoo Sports, Bwin, Parimatch, Tipico and Sportsbet.io.