Virtual Currency Games

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) agent…

Digital currencies have been slowly gaining in maturity both in terms of their functionality and the financial infrastructure that enables them to be used as a credible alternative to non-virtual fiat currency. Though Bitcoin, the 1st and most popular of the crypto-currencies was created in 2009 2009 2009 there have been forms of virtual currencies used 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 property. 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 world economics to the extent that the Ultima currency experienced inflation because of the game mechanics which ensured that there is a never ending way to obtain 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 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 and other such games full-time with the purpose 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 were unwilling or unable to put in the hours to level-up their very own characters. In line with the calculated exchange rate of EverQuest’s currency because of real life trading that took place 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 globe, somewhere between 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 is perhaps the most complete example of a virtual economy up to now whereby it’s virtual currency, the Linden Dollar which can be used to buy or sell in-game goods and services could be exchanged for real world currencies via market-based exchanges. There were 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 were able to design, promote and sell content they created. Real estate was a particularly lucrative commodity to trade, in 2006 Ailin Graef became the 1st 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 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 more than $5000 in 2009 2009 from Second Life activities.

How exactly to be paid in dollars for mining asteroids…

To date, the ability to generate non-virtual cash in video gaming has been of secondary design, the player having to go through non-authorised channels to exchange 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 could be set to change with the advent of video gaming being built from the bottom up round the ‘plumbing’ of recognised digital currency platforms. The approach that HunterCoin has taken is to ‘gamify’ what is typically the rather technical and automated procedure for creating digital currency. Unlike real world currencies which come into existence if they are printed by a Central bank, digital currencies are created when you are ‘mined’ by users. The underlying source code of a particular digital currency which allows it to function is named 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 for the reason that it is possible to duplicate a unit of currency thereby causing inflation or altering the worthiness 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 every transaction that’s made whereby with the aid of specialist hardware and software they ensure that data is not tampered with. This is an automatic process for miner’s software albeit an extremely time consuming one which involves lots of 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 as an incentive to help keep maintaining the network, thus is digital currency created. Because it can take anything from several days to years for a person to successfully mine a coin sets of users combine their resources into a mining ‘pool’, utilizing the joint processing power of their computers to mine coins more quickly.

HunterCoin the game sits within this type of blockchain for an electronic currency also called HunterCoin. The act of playing the overall game replaces the automated procedure for mining digital currency and for the first time makes it a manual one and without the need for expensive hardware. Using strategy, time and teamwork, players go out onto a map in search of coins and on finding some and returning safely to 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 to their own digital wallet, typically an app designed to make and receive digital payments. 10% of the value of any coins deposited by players visit the miners maintaining HunterCoin’s blockchain plus a small percent of any coins lost when a player is killed and their coins dropped. As the game graphics are basic and significant rewards remember to accumulate HunterCoin can be an experiment that might be viewed as the first video game 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 for example asteroids and trading them for goods with other players with the purpose of building their own galactic empire. Players will undoubtedly be rewarded for mining in DogeCoin, a far more established form of digital currency that is currently used widely for micro-payments on various social media sites. DogeCoin will also be currency of in-game trade between players and the methods to make in-game purchases. Like HunterCoin, DogeCoin is really a legitimate and fully functioning digital currency and like HunterCoin it is usually traded for both digital and real fiat currencies on exchanges like Poloniex.

The future of video gaming?

Though it is start in terms of quality the release of HunterCoin and VoidSpace is an interesting indication of what may be the next evolution for games. MMORPG’s are being considered as methods to model the outbreak of epidemics as a result of how player’s reactions to an unintended plague mirrored recorded hard-to-model areas of human behaviour to real world outbreaks. It may be surmised that eventually in-game virtual economies could be used as models to test economic theories and develop responses to massive failures predicated on observations of how players use digital currency with real value. Bitcoin Revolution 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 regions of personal digitial ownership for example. In the mean time, players now have the means 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 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 can’t be exchanged directly to USD, one must convert it into a more established 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 then 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 hire a few ‘bot’ programmes that could 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 right now even efforts such as this might only realistically bring about enough change for a daily McDonalds. Unless players are prepared to submit to intrusive in-game advertising, share personal data or join a casino 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 positive thing, because surely if you get paid for something it stops being a game any more?