Virtual Currency Games

Every little boy’s (and several 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 another where one’s ranking on a scoreboard could be rewarded in dollars, and sterling, euros and yen.

The story of the millionaire (virtual) real estate agent…

Digital currencies have already been slowly gaining in maturity both in terms of their functionality and the financial infrastructure that allows them to be used as a credible alternative to non-virtual fiat currency. Though Bitcoin, the very first and most well known of the crypto-currencies was made in 2009 2009 2009 there have been forms of virtual currencies used in video games for a lot more than 15 years. 1997’s Ultima Online was the initial notable attempt to add a large scale virtual economy in a casino game. Players could collect coins by undertaking quests, battling monsters and finding treasure and spend these on armour, weapons or property. This was an early incarnation of a virtual currency in that it existed purely within the game though it did mirror real life economics to the extent that the Ultima currency experienced inflation as a result of the overall game mechanics which ensured that there is 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 even though it was prohibited by the game’s designer to also sell virtual what to one another on eBay. In a genuine world phenomenon that 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 aim of gaining experience points so as to level-up their characters thereby making them more powerful and sought after. These characters would then be sold on eBay to Western gamers who have been unwilling or unable to devote the hours to level-up their very own characters. Based on the calculated exchange rate of EverQuest’s currency as a result of the real world trading that took place Edward Castronova, Professor of Telecommunications at Indiana University and a specialist in virtual currencies estimated that in 2002 EverQuest was the 77th richest country on earth, somewhere within Russia and Bulgaria and its GDP per capita was higher than the People’s Republic of China and India.

Launched in 2003 and having reached 1 million regular users by 2014, Second Life could very well be the most complete exemplory case of a virtual economy up to now whereby it’s virtual currency, the Linden Dollar which is often used to buy or sell in-game goods and services could 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 10 years between 2002-13, Second Life having turn into a marketplace where players and businesses alike could actually design, promote and sell content that they created. Real estate was an especially lucrative commodity to trade, in 2006 Ailin Graef became the very first Second Life millionaire when she turned an initial investment of $9.95 into over $1 million over 2.5 years through buying, selling and trading virtual property to other players. Examples such as for example Ailin are the exception to the rule however, only a recorded 233 users making a lot more than $5000 in ’09 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 games has been of secondary design, the ball player having to proceed through non-authorised channels to exchange their virtual booty or they needing to possess a degree of real life creative skill or business acumen which could be traded for cash. This could be set to change with the advent of video games being built from the bottom up round the ‘plumbing’ of recognised digital currency platforms. The approach that HunterCoin has taken is to ‘gamify’ what’s usually the rather technical and automated process of creating digital currency. Unlike real life currencies that come into existence if they are printed by a Central bank, digital currencies are manufactured by being ‘mined’ by users. The underlying source code of a particular 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 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 worthiness of a transaction after it’s been made for personal gain. To make sure this will not happen the blockchain is ‘policed’ by volunteers or ‘miners’ who test the validity of each transaction that’s made whereby with the aid of specialist hardware and software they ensure that data has not been tampered with. This is an automatic process for miner’s software albeit an exceptionally time consuming the one that involves many processing power from their computer. To reward a miner for verifying a transaction the blockchain releases a fresh unit of digital currency and rewards them with it being an incentive to help keep maintaining the network, thus is digital currency created. Because it can 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’, utilizing the joint processing power of their computers to mine coins quicker.

HunterCoin the game sits within this type of blockchain for an electronic currency also called HunterCoin. Bitcoin Era of playing the overall game replaces the automated procedure for mining digital currency and for the first time helps it be 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 out there attempting to stop them and steal their coins) they are able to cash out their coins by depositing them into their own digital wallet, typically an app designed to make and receive digital payments. 10% of the worthiness of any coins deposited by players visit the miners maintaining HunterCoin’s blockchain and also a small percent of any coins lost when a player is killed and their coins dropped. While the game graphics are basic and significant rewards take time to accumulate HunterCoin can be an experiment that might be seen as the first gaming with monetary reward built-in as a primary function.

Though still in development VoidSpace is really a more polished approach towards gaming in a functioning economy. A Massively Multiplayer Online Roleplaying Game (MMORPG), VoidSpace is set 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 goal of building their own galactic empire. Players will undoubtedly be rewarded for mining in DogeCoin, a far more established form of digital currency which 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 really a legitimate and fully functioning digital currency and like HunterCoin it might 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 can be an interesting indication of what could be the next evolution for games. MMORPG’s are currently being considered as methods to model the outbreak of epidemics because of how player’s reactions to an unintended plague mirrored recorded hard-to-model areas of human behaviour to real world outbreaks. It could be surmised that eventually in-game virtual economies could possibly be used as models to test economic theories and develop responses to massive failures based on observations of how players use digital currency with real value. Additionally it is a good 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 methods to translate hours before 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 that a player could comfortably recoup their initial registration fee of just one 1.005 HunterCoin (HUC) for joining HunterCoin the overall game in 1 day’s play. Currently HUC cannot be exchanged right to USD, one must convert it into a competent digital currency like Bitcoin. During writing the exchange rate of HUC to Bitcoin (BC) is 0.00001900 as 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 consideration would mean… $0.01 USD. This is simply not to say that as a player becomes more adept they could not grow their team of virtual CoinHunters and perhaps employ a few ‘bot’ programmes that would automatically play the game beneath the guise of another player and earn coins for them aswell but I think it’s safe to state that at the moment even efforts like this might only realistically result in enough change for a daily McDonalds. Unless players are prepared to submit to intrusive in-game advertising, share personal data or join a game such as CoinHunter that’s built on the Bitcoin blockchain it is improbable that rewards are ever apt to be a lot more than micro-payments for the casual gamer. And maybe this is a good thing, because surely if you receives a commission for something it stops being truly a game any more?