Esports is a term for competitive gaming where players usually compete in different categories, organizing or enrolling in tournaments and battles. The Fortnite prize pool for 2017–2018 went up to $100,000,000. This is how far the industry can come and it is the perfect ground to build Blockchain and smart contracts opportunities.
To learn more about the enterprise use case of esports on blockchain, please read this case study [https://bitcoinassociation.net/enterprise/use-cases/bsv-for-esports/esports-on-blockchain/].
Esports tournaments are huge events that involve a massive group of people. Blockchain can secure and make the competitions more efficient, therefore smart contracts can be useful for pay-outs based on the player’s performance during a tournament. Instant transactions and transparency of such events are important for esports’ reliability. There are some challenges that esports face on a daily basis and some Blockchain solutions, that might be the answer.
What challenges does the esports industry face?
This industry is quite new on the market and challenges don’t pass it. There are a couple of quite significant ones that stand out and can divert players. Players receive a small portion of what the industry earns yearly, and fans of esports can’t know who the players are, unless they have accounts on YouTube or the streaming platform Twitch. Within esports, there is no sufficient ecosystem and no transparency on pay-outs. When it comes to content, there is not much and when there is, it’s mostly advertisements. No effective monetization system is present, as well for content creators. When it comes to investing in esports is not that easy without secure participation within esports.
0:1 For Blockchain Technology in Esports: Some major decentralized changes
Blockchain can help esports platforms bring together a range of stakeholders, media, sponsors, and others. Stakeholders can use Blockchain-powered platforms to distribute prizes, sponsorships, media rights, transfers of players, etc.
Blockchain is the power house of the trust factor within many industries. Esports is one of them. In order for players to perform better and have the motivation to join this community, they need to feel safe. Blockchain brings transparency to payments and smart contracts solve legal issues between developers and tournament organizers. Game developers can secure their games and get securely payed. Blockchain solves the unfair prize money distribution on the tournaments.
For cryptocurrency payment solutions within the esports industry, read our latest article on Medium.
Blockchain solves match-fixing in esports, as managers pressure players to lose tournaments. The technology allows players to be more autonomous and all contracts and agreements are there for everyone to see. Tournaments are quite expensive, so Blockchain reduces costs of setting up esports platforms and those of tournaments.
Blockchain also solves the problem of donations in esports. Sometimes viewers can ask for a “chargeback” from the players, so Blockchain is streamlining the process.
Many esports teams have conducted ‘initial coin offerings’ or ‘ICOs’ as means of raising funds for their activities, but an ICO is also effective for developing brand identity.
These ICOs are made by creating some merchandise that can be purchased with a native coin or awards. Taking part in ICOs increases competition between coins and when there is a tournament, the value of coins fluctuates and it causes more engagement to the viewers.
Outside of brand building, Blockchain can help esports team scout for talents, just like in real sports. This can happen by creating a publicly accessible ledger of individual player portfolios with gaming records. Such publicity may cause leaking of personal information without consent and on the Blockchain, it cannot be removed, so this practice might cause damage to the careers of potential talents.
Esports fandom, collectibles and in-game assets through Blockchain
One of the most exciting prospects of esports are fandoms and merchandise that are created for binding the esports community.
In-game assets are quite valuable and with Blockchain they can be traded. Games can have their own tokens and in time, the tokens might have the same value. If the esports platform is Ethereum-based, the ERC20 tokens can be used for such assets. Blockchain allows the trading to commence in crypto exchanges. Assets can be unique and represented by “Non-Fungible Tokens” (NFTs), which respond to the ERC721 token standard.
Skins are quite popular with esports and players use them for cosmetic purposes, such as outfits or colors of weapons.
It all sounds very nice and innocent until unlicensed skins, gambling and fraud come up. Nowadays developers try to solve the issue and skins become highly-valued rewards from competitions with special tokens to trade these assets. Blockchain can be used for an inventory for skins and in-game assets. Non-Fungible Tokens (NFT), unique cryptographic tokens, can be used for ensuring uniqueness and avoiding replicas. These tokens can be traded for fiat currencies.
Blockchain impacts fan identity by creating experiences such as crowdfunding of assets, collectibles and superfan assets. There could be Blockchain loyalty programs, offering good payouts. Ethereum-based programs can go over partner networks and let rewards be used with partnering brands. The Ethereum Blockchain allows people to buy shares. Tokenized team shares can be purchased on the open market and the token owners can be a part of the financial side of organizations and sports teams.
Esports and Blockchain go together by all means. They need each other to grow, to improve and to conquer both industries. Milestones are yet to come, as digital innovations make esports transparent, secure, trustworthy, helping gamers succeed in their careers and introduce the Blockchain technology to the public.
If you are interested in reading other enterprise use case studies done by the Bitcoin Association follow those link and enjoy the professional work done by them
iGaming on blockchain; BSV for iGaming
Payments on blockchain; BSV for payments