Collectible Card Games and Tokenization of Digital Game Assets on the Blockchain

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*On Oct. 16, 2019, the developers of Gods Unchained published a blog that outlines upcoming improvements to their card minting process. The information contained below about network transaction costs will no longer be accurate once those changes are implemented.*

Gods Unchained is a collectible card game (CCG) that gives players the option to store their cards on the Ethereum blockchain. From there, they can trade or sell them on third party storefronts. Most of us probably remember the news that came out a few months ago about the upcoming Forte digital gaming marketplace powered by Ripple technology. Gods Unchained is an interesting foray into how these kinds of assets or games would operate using some of the various blockchain systems in place, and it is an indication that low transaction cost cryptocurrencies like XRP and Ripple powered tech like ILP and Codius could be superior for purchasing and tokenizing these kinds of assets.

The developers of Gods Unchained garnered a lot of goodwill in the gaming community when they offered to cover the stripped winnings of a professional Hearthstone player after Blizzard removed him from the tournament and rescinded his winnings over statements during a tournament broadcast that explicitly supported protesters in Hong Kong.

Players can purchase cards in Gods Unchained using Ethereum. The packs differ by rarity, and players can buy rare, epic, legendary, or shiny card packs. The rarer the pack, the more expensive. The priciest was above $186.60 when I checked the cost.

With these cards and the free packs they earn while battling, players can build decks with monsters, warriors, and spells that they then use to battle other players in the game’s various modes.

The free packs of cards a player can earn while playing the game seem different than the packs that are purchasable on the game’s digital storefront. To be clear, they both function the same while you are playing, but when you buy a pack of cards from the store, a smart contract is created, which records the amount and type of card packages you have purchased. For example, if you bought a single legendary card pack from the storefront, a smart contract would be created that records the value of the transaction at 0.112 Ether (the cost of a single Legendary card pack). With earned cards, no smart contract is created when you receive them, and they don’t seem to be stored on the blockchain at all.

The minted cards are Erc721 tokens viewable on block explorers like etherscan.

The cards are not immediately minted when you purchase them, and must be activated on the Ethereum blockchain in a separate transaction. There currently doesn’t seem to be any way to do this in bulk. Each purchase transaction generates a different smart contract. A contract for six-packs, like in the picture below, must be settled independently of any other contract.

It’s important to separate the gameplay from the blockchain as card usage is not dependent on the Etherum blockchain, which is only used to tokenize the cards when a player wishes. The gameplay is quite fun and has most of the features you would expect from a digital card game. The worst part about the Gods Unchained experience was the high transaction costs incurred when minting. It’s an odd thing for the worst part about a blockchain-based card game to be the interaction with the blockchain, but for me, that was the most grating part of the Gods Unchained experience.

Network Transaction Cost

Players must pay a network transaction fee twice, once when sending ETH to the storefront and again when tokenizing the cards. If an exchange isn’t available that can deposit directly to metamask, a transaction fee must be paid three times. This can get expensive when the network transaction fees are high. Metamask recommended a network fee of $3.12 to mint my first pack of six cards onto the Etherum blockchain. For a single pack of the same type, the network transaction fee was $0.58. I purchased the same card pack a few days later, and the network fee for minting was $0.10 for the single pack and $0.61 for the pack of six. I’m not sure why the recommended transaction fees were so high on that particular day. It could have been network congestion or a bug that I encountered, but the high, medium and low options for metmask were all around $3.00. I could have manually set the transaction amount in metmask to something far lower on the more expensive days, but I wanted to give an indication of what a novice player would encounter if he tried to purchase cards and tokenize them on the blockchain. If you’re familiar with cryptocurrency transactions, you can lower the costs, but this requires a degree of technical sophistication beyond what can be reasonably expected for a novice user.

On the cheapest day that I minted the cards, the cost for all network-related transactions for six-packs of rare cards was $0.75. The total cost of a single pack of rare cards was $2.24. In order to purchase six-packs of rare cards, and to mint them onto the Ethereum blockchain, it costs me 33% of a single pack of cards to do so. On the most expensive day, the cost to mint the cards absent the ETH transfer costs were worth roughly 1.39 packs of cards.

The cards do not need to be minted on the Ethereum network to enable play, and a post on the Gods Unchained subreddit includes the suggestion that players wait to do so as future updates may include a cheaper and more efficient process. At the moment, the activation process tap dances around the expensive transaction fees of the Etherum network. Blockchain integration seems tacked on as a less efficient and more cumbersome alternative to some of the different CCG storefronts out there. The singular advantage is that the cards can be stored and traded independently of a game’s storefront. Compared to a game like Gwent, where you cannot trade the cards at all, this is an improvement. But even then, with Gwent all you need is a credit card and a game account to play. Collectible enthusiasts would probably prefer a physical card to an Ethereum token, and gamers would turn to the much more accessible blockchain free alternatives. Gods Unchained is still in beta, so there is the possibility of improvements to the card minting model, but my experience with games in general leaves me skeptical that a great deal will change from now to the game’s release.

The Forte Marketplace

Most of this will be assumptive as we do not have access to the Forte marketplace, but if Forte wants to allow developers to sell game assets on the Forte marketplace as a form of monetization, then they must have some way to track what those assets are, and who owns them. They have also indicated that they are aiming towards decentralization on their marketplace:

“Our aim is to support the decentralization of these technologies, where open protocol networks support a wide variety of game economies based on what’s at stake. There is an amazing degree of research and innovation happening across the entire sphere of blockchain development today, and our goal is to use the best of breed solutions across the entire space, and to enable game developers to do the same so that they can focus on creating great games for their players. This desire to support the best of breed solutions across the entire blockchain ecosystem means we need to support multiple blockchains and empower cross-chain interoperability for developers and players. That is where our partnership with Xpring and the truly outstanding innovation they’ve created with both the open source Interledger Protocol and Codius come in.”

“We’re building a wallet that will be easy to use and integrate with both new and existing games on many platforms and facilitate cross-chain transactions using Interledger. We’re building a container-based hosting solution compatible with the Codius specification for running game-specific chains and flexible, secure, performant computation that rich, engaging games need. We’re building a security-audited smart contract framework and tools to inspect nodes, update contracts, reconcile new data, generate data reports, and mint new chains. We’re securing licenses for regulatory compliant operations in all major markets.”

The interesting aspect of blockchain interoperability enabled by Ripple technology would be the possibility in the future to trade, exchange, or sell the Gods Unchained ERC 721 tokens mentioned above on the Forte decentralized marketplace. This is probably pie-in-the-sky fantasy, but a future Forte marketplace could theoretically allow users to transact on the Forte marketplace with any available currency, and I don’t see why it would be impossible to set up a smart contract that would trade an ERC 721 Gods Unchained card for traditional currency, cryptocurrency, or some other kind of digital game asset – something like a trading card in a digital card game being exchanged for a gun skin in a video-game via a decentralized marketplace.

The use of XRP to settle would also drastically reduce the cost of transactions for the average consumer. The Forte Marketplace also integrates ILP, which could take care of the cumbersome chain of moving crypto from an exchange to a wallet and into a storefront. It would also provide the added benefit of seamless transactions across blockchains.

A decentralized marketplace that uses proven open-source technologies like ILP, XRP, and Codius could allow developers to digitize collectibles and enable trade between players all over the world for a fraction of the transaction cost that the Ethereum network currently allows.

If the Forte marketplace works as well as we’ve seen something like Coil work, it could provide collectible card game developers with a vibrant and easy to use marketplace and tokenization process that they can easily integrate into their games. Coil currently allows users to pay for their subscription product via credit card, which sends microtransactions of XRP to content creators based on the time they spend on the content. If the Forte marketplace allows players to transact via credit card in a similar manner, it could very well jumpstart cryptocurrency adoption amongst gaming platforms because it would be absent the inconvenience and transaction costs of the traditional exchange to wallet to store purchasing process present in earlier blockchain gaming alternatives.

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