Should Games Be Built Fully On-Chain?

In the article, our analyst Jerry Kwok provides a primer on blockchain games and explores the promises and impediments of building games fully on-chain.

Access the full article now: https://bit.ly/3NgdPsP

What are FOCGs?

Compared to Web 2.5 games, which involve tokenizing in-game assets or launching on-chain game currencies, FOCGs implements the entire game logic, state, and data storage on-chain. These client-agnostic games use blockchain as a decentralized game server, where players participate and contribute to a shared game state trustlessly.

Due to blockchain bottlenecks such as lack of native game ticks, high gas costs and low throughput, early FOCGs were blockchain-based games with asynchronous gameplay elements, i.e. turn-based TCGs. For other game genres, such as high tick RTS games that operate synchronously, scaling solutions become necessary.

The effective implementation of ZKPs (i.e. Dark Forest using zk-SNARKs) is also essential for incomplete information games to be built fully on chain while guaranteeing fairness.

Composable Modding

Mods in traditional games largely exist in isolation and fragmentation, lacking universal frameworks for meaningful interactions. To achieve composability, a potential approach is to allow third-party developers to directly interact with the game logic through smart contracts, allowing them to:

• Create new mods (with mod-specific token economy)
• Extend existing games and mods (such as adding new items, characters and quests)

This incentivises modders to consider all relevant mods when designing new features as these inputs could directly impact gameplay across the board, as opposed to merely aesthetic variations.

Smart contracts as social contracts

In traditional games, players relied on informal and unenforceable agreements for interactions that went beyond the predefined in-game mechanics. This approach has limitations, particularly in high-stakes games where the impact of broken agreements can be substantial.

Treaties explored by Curio, are in-game smart contract agreements that can be formalized between players and can be trusted to execute when predetermined conditions are met. The customizability and modularity of these in-game smart contracts could extend social dynamics beyond the boundaries of games and allow for direct interaction with other on-chain ecosystems, such as DeFi protocols.

Impediments to FOCGs:

• High gas costs and low TPS - bottlenecks of most mainnet chains make it challenging to support synchronous games and concurrent game sessions/instances.
• Vulnerability of on-chain randomness - validators can see the result of randomness before its confirmed on-chain, creating room for manipulation.
• Cost of permissionless composability: + Necessitate consistent game physics across all mods which restricts flexibility for modders + Game balance considerations limit new inputs to low impact features, i.e. aesthetic variations that don't impact gameplay. + Updating new inputs across the entire tech stack, including front-ends and relevant contracts, would entail complex coordination. + Different genres require different tick rates, which makes it impossible to build new genres of mods that rely on a higher tick rate than what the infra can offer.

What Jerry Kwok thinks of FOCGs:

In an ideal scenario where the value propositions of FOCGs proves highly valuable for players and modders, traditional games could incorporate these elements into their off-chain or hybrid systems, benefitting from them without being restricted by design space limitations.

However, I am hopeful that FOCG could out compete these hybrid games in specific niches. I believe the strongest case for FOCG are high stake games, driven by a player base that demands not only in-game assets and credentials but also the entire game logic to be on-chain.

Take Marvel Heroes shutting down as an example in Nov 2017. The studio, Gazillion received a wave of demands for refunds. However, with clever legal technicalities, consumers found themselves without a straightforward entitlement to compensation nor access to purchased in-game assets.

Merely having assets on-chain does not completely solve this problem in the event of a game studio rug pull, as the game state and progress would still be lost, rendering those assets useless in terms of gameplay utility.

In-game mechanics and outcomes being provably fair is also significant.Imagine a group of players engaged in a battle against a common enemy, where a high-value item drop is at stake for the highest damage dealer. Or a 4x RTS game where spawn location and proximity to scarce resources are randomized. In these scenarios, FOCG can guarantee the outcome of the battle or randomness to be tamper-free.

This trustless environment would not only benefit the players but also extend to speculators and protocols that place bets via smart contracts on game outcomes. Ensuring unmanipulated game result and permanence (as game state and logic can be forked) would allow for high stake game ecosystems and its economies to truly scale without any platform risks.

Jerry Kwok goes into more details about what other elements need to be further explored and aligned in the article: https://bit.ly/3NgdPsP