After officiating international esports events, I am extremely bullish on game blockchain integration
Stop being an NPC in the game, be a creator player of a new civilization.Author: msfew, @msfew_eth
Internet-addicted Youth → Esports Referee
I am msfew, a heavy internet addict. Since elementary school, I have continuously immersed myself in video games, playing League of Legends with classmates on a laptop that barely runs at 20 frames per second.
Whether during my undergraduate classes, while interning at Google as a programmer, or later joining ORA (ora.io, World Intelligent Network) as part of an AI startup, I have never stopped dedicating several hours a day to gaming, even sacrificing sleep to play.
As my understanding of the gaming industry deepened, I recently realized the importance of becoming an "Esports Referee." After trying out a few events, I leveraged my narrative skills honed in the Crypto industry and my multilingual advantages to secure the position of an executive referee for the top international event, the "Overwatch Global Championship."
I officiated in front of players and coaches from European and American teams, as well as tens of millions of online and offline viewers at the Hangzhou Asian Games venue, ensuring the fairness and smooth execution of the event. (The person looking at the camera in the picture is me)
(This article's main theme is about gaming assets on the blockchain. If you're interested in the esports referee part, you can skip to the end to see the related content.)
Version Abandonment: Blockchain Games
2021 - 2022 was the peak of blockchain games. It seems that after that, we have not heard much about blockchain games, nor have we seen new giant blockchain game projects, only sporadic mentions of narratives like full-chain games.
Many analytical posts have discussed why GameFi failed (for example, considering gameplay, considering data metrics). Successful narratives and tracks have their own merits, but the reasons for failure are always the same: the narrative/product/new traffic cannot support the price ("Issuing bonds < Debt conversion"). GameFi has always been about the old "Play-to-earn," "Encircling cities from the countryside," "New economic systems," "New traffic entering the system," and cannot create or keep up with new rhythms.
Capital began to vote with its feet, and the funds entering the GameFi sector decreased, leading to fewer people entering this field. The overall quality of projects in the sector deteriorated, and projects that previously raised large amounts of money could not deliver on their original expectations, leading to a collapse of the inflated narrative bubble and creating a vicious cycle.
The Direction of Games + Blockchain?
How can we save blockchain games? I believe there are mainly three methods:
Tokenization: Abandon those poorly made low-quality games, stop pretending, and directly attempt to combine existing games with blockchain.
Full-chain games: Still full-chain games, but not for the sake of making games, rather to drive the development of infrastructure through the demand for games.
Incorporating new technologies: For example, integrating AI into games to make them more enjoyable.
Tokenization of Game Assets
After this cycle of influence, now 100% of people in the crypto circle are no longer averse to asset tokenization. This cycle is not lacking in good narratives, so games have been neglected.
However, traditional Web2 games that truly have consensus have been overlooked. They are the real hot topics.
Games "built natively from Web3" inherently struggle to compete with traditional gaming giants (for example, a few years ago, when Riot released a shooting game, it garnered huge attention) or traditional channels. Or rather, these games themselves are unwilling to take the "difficult path." Of course, if a game has a crypto-native mechanism, then it is essentially selling the currency as a product, and it is reasonable to consider tokens as products.
Instead of pondering how to carve flowers on dog shit, it is better to choose quality themes from the source.
Good Games Generate Good Assets
When it comes to the assets within popular games, they are excellent subjects for tokenization due to three advantages:
The speed of trend formation + the scarcity and non-replicability of the event itself: Once a good game issues a token, it is a one-time event. There are only a few good games; issuing one means one less.
Consensus scope: Most people in the crypto market highly recognize high-quality games.
Financial strength of the audience: Players and traders are willing to spend big money on game-related on-chain assets.
Additionally, the attention mechanism of games differs from that of memes, each with its pros and cons. The propagation mechanism of memes is fast and quickly fades, with very few memes surviving for years, while the propagation and attention for games are sustained, resembling an initial rapid phase followed by a prolonged engagement.
Similar mental models:
Game assets inherently possess a mental model similar to crypto assets. Taking CSGO as an example, Play-to-earn (box drops) + randomness (getting a rare skin) + series and individual items (NFTs) are very similar. At the same time, traders tend to have a "gambler's mentality," understanding that they are speculating. Of course, many gamers do spend a lot of money just to buy items based on luxury logic.
Loser Business:
A viewpoint that is often criticized is that in the future, one should invest in loser businesses, and gaming is a continuously growing loser business. More fresh blood will enter the system. One can refrain from trading tokens, but if one does not play games, it would be quite odd.
Did people not know these truths before? Why are they being stated now? I believe it is mainly because times have changed, the infrastructure is ready (trading platforms themselves, various "brokerages"), and the perception of tokens and on-chain assets is becoming increasingly accepted.
Having discussed the advantages, one issue is that game assets are limited by the game's ceiling (which is quite high), and they cannot propagate infinitely like pure memes (for example, elderly people may know Trump but resist understanding games). There are also regulatory and IP restrictions.
Finally, we return to the initial viewpoint: in the gaming sector, we should try to issue assets for good games/good assets, rather than creating garbage assets to issue assets. This is also a lesson learned from the previous cycles of AI and gaming experienced (everyone builds launchpads, launchpads build more garbage assets, which actually does not work).
Taking CSGO Skins as an Example
CSGO skins are a typical example of game assets because their model is simple enough (much simpler than the previously most sought-after Dream of the Red Chamber during the last GameFi cycle) and they are sufficiently popular.
Previously, off_thetarget, Gink5814, and I have all published content related to CSGO skins.
In simple terms, CSGO skins:
CSGO is a shooting game with many weapons (AK, M4, pistols, knives, gloves). The game's popularity is already very high.
The default skin is ugly (compared to skins), and you can purchase weapon skins through opening cases or the secondary market.
Skins correspond to → weapon type (main weapon? knife? gloves?) → specific model (AK, M4, butterfly knife) → wear level and pattern; coincidentally corresponding to the NFT track (PFP? U card?) → specific series (Punks, BAYC) → specific small images.
Players have a very high motivation and demand for buying skins, and there is even an official burn mechanism like account bans from the gaming platform.
However, I believe the current risk of CSGO skins lies in the price running far ahead of the value. The actual growth of the game's traffic may be declining, but due to narratives like "being a landlord" and "skin flipping," it has attracted a lot of pure capital and speculative traffic:
Being a landlord means buying skins and then renting them out. If the skins continue to rise, that’s great (however, there is still the risk of being bought out), but if they drop, the returns may not even be as good as a money market fund… So whether they rise or fall, good returns are not guaranteed.
Skin flipping seems to be finding dumb money to provide liquidity for the entire system, letting them calculate exchange rate differences, buying cheap dollar cards, but the sources of these cards and the 7-day lock-up mechanism make one worry about whether they will be the last wave in case of a sudden crash…
The propagation is too aggressive, usually through QQ groups and WeChat groups, where "teachers" command everyone to collectively raise their listing prices…
Overall, CSGO perfectly fits our narrative of "popular Web2 games on the blockchain." We have two directions to integrate CSGO skins with blockchain and achieve "on-chain" game assets: 1) Sell shovels; 2) CSGO on-chain fund.
1. Sell Shovels: Create CSGO Skin Trading Tools with Crypto Thinking
In any trading-related field, it is always selling water and shovels that can safely traverse bull and bear markets. Bloomberg, Uniswap, law firms, auditing companies… are all giants that stand firm, ignoring market conditions.
In crypto, assets and narratives change (ICO → VC coins → DeFi → GameFi → pure memes), trading methods also change (CEX → AMM → NFT → TG Bot → on-chain scanning terminals), but the demand for better, more comprehensive, and faster trading tools remains constant.
In terms of technical limitations, both crypto and CSGO skins have some strange restrictions:
Crypto: On-chain trading must generally follow AMM trading methods, and there are regulatory restrictions off-chain.
CSGO skins: The trading mechanism has cooldown period restrictions, and trading platforms adopt a listing system similar to NFTs.
Although both are constrained, they have each created a decent trading experience. The development of trading tools in crypto has actually been faster, undergoing multiple iterations. For example, to solve the fragmentation issue of AMM, aggregators like 1inch emerged; to address the fragmentation of NFT platforms, platforms like Blur appeared; to separate trading from wallets, DEX Wallets and TG Bots were developed…
Currently, the trading of CSGO skins can be improved with the following features:
"Chain Scanning Platform": Similar to crypto chain scanning platforms, analyzing KOLs and professional players' holdings
"Aggregator": All-in-one brokerage platform for buying (view base prices across platforms) and selling (analyzing volume and price of orders across all platforms + avoiding overselling + considering exchange rates and lock-up)
"Exchange": A trading mechanism similar to AMM (not selling to buyers but selling to the platform or pool), achieving true instant buy and sell.
"Derivatives": Leveraged trading, going long or short, lending, and other financial instruments and derivatives.
As an industry rooted in trading and thriving on it, crypto has rich experience in creating trading tools under technical constraints, which I believe will be a significant advantage for CSGO skin trading platforms.
Strong individuals never complain about the environment. If CSGO skins have more mature trading platforms and experiences, everyone's holdings will also be more diverse, and the volume and price will inevitably be healthier.
2. New Assets: On-chain ETF for CSGO Skins
The narrative of RWA and the interconnection of crypto stock platforms has recently gained traction. I believe the biggest issue with traditional assets on-chain is that these RWAs lack sufficient appeal, falling into the middle ground:
Their yields are not as high as stablecoins, nor do they have the safety of stablecoins (if stablecoins and US Treasury bonds are not counted as RWAs).
The purchasing process is complicated and requires KYC (not achieving the idealized RWA's ability to bypass geographical restrictions and the characteristics of geographical arbitrage).
Their appeal is lower than memes or other assets (few people in the crypto circle would want to buy funds for corn or soybeans; these are basically garbage assets packaged on-chain seeking exit liquidity).
Interestingly, CSGO skins have a clear division of indices, such as skin indices, default skin indices, agent indices, etc. They are naturally categorized into clear types, and can also be further subdivided into specific weapon series. CSGO is an excellent asset that is RWA and appealing.
The advantages of creating a fund for CSGO skins are numerous:
Benefits of on-chain funds: The general advantages of on-chain funds, with data and flows being transparent, low operational costs with a single contract, and unrestricted on-chain circulation.
Capturing the skin indices: Instead of risking individual items, capturing the returns of the entire field. CSGO skins have always had indices, but they were not tradable, leaving many people to only observe without participating.
Introducing gaming traffic: The logic of mass adoption. Gamers may enter crypto through this index fund, leading to a good out-of-circle effect and ultimate ceiling.
Pricing consensus among young audiences: Young people, especially those in the crypto circle, are not interested in many RWAs and do not take them up, but will chase after assets they care about. CSGO skins are an example. Young people play games every day, naturally developing an inexplicable affinity for these items.
How can a CSGO skin fund be realized? A simple idea for a knife skin index fund:
The knife fund allocates 80% to various categories of knives, and 20% can be used as stablecoins to earn yields.
To ensure that no one feels the presence of crypto, even though it is an on-chain fund, it can still allow fiat currency to enter and exit directly.
If someone feels that merely capturing yields is not enough (many players purely buy skins based on luxury logic), then holding a certain amount of fund shares can allow them to borrow skins from the fund's holdings for free; additionally, a certain proportion of skin holdings can be rented out on trading platforms.
In case of regulatory avoidance, we can use token standards like ERC-7641 RevShare Token to package it from the fund into a shareable yield token, sharing the value growth of assets in the fund and rental income.
Other Directions
In addition to the major direction of asset tokenization, there are two smaller directions: full-chain games and the integration of AI.
For full-chain games, the meaning lies not in putting games on-chain, but in promoting the development of underlying infrastructure through applications. Just like in the example of GPUs, people simply want to play better and more realistic video games, which drives advancements in graphics, and the progress in graphics in turn promotes the development of GPUs, which then fosters advancements in cutting-edge technologies like AI. A recent example in crypto is the Crossy Fluffle mini-game created by MegaETH; it is not about the game being core, but about encouraging stronger underlying infrastructure through these application demands.
Regarding the integration of AI, AI can exist as a neutral agent, executing tasks objectively, thus perfectly performing tasks like esports refereeing mentioned at the beginning; at the same time, AI can also serve as a generator of stories, infinite maps, and game assets…
Conclusion: GG, but No WP
This is why, after serving as a referee for international events, I am optimistic about the prospects of gaming assets on-chain and the combination of gaming and crypto.
It is not because gaming or asset tokenization is particularly popular now, but because we may finally have figured out how to play the game.
GameFi had its wins and losses, but this time, the crypto world has reopened, and the strategies will be more mature, with asset models and perceptions becoming more solid.
Don’t be an NPC in games; be a creator of a new civilization.
Some Insights as an Esports Referee
Here are some additional small insights, unrelated to the main text, for entertainment:
Esports referees are not like traditional sports referees; they basically do not need to make judgments on the outcome of matches. Their main role is to help players debug equipment or allocate resources.
The essence of an esports referee is actually that of a liaison on the field, facilitating communication internally (with players and coaches) and externally (with the main referee and event director team).
Getting into esports refereeing or the esports circle is actually very simple, much easier than leveling up in games. The challenge lies in securing individual match resources; once you have the first one, it becomes much easier.
There is a significant shortage of people who can speak English and Korean, and those with translation abilities are very scarce.
Esports competitions must always be held offline, as players' geographical locations must be unified to ensure relative fairness.
Esports, like Web3, operates mostly at night or even late at night, aligning better with the biological clock of young people.
Esports will replace traditional sports; the new generation will choose to participate in and watch esports rather than traditional sports.
