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The #Esports Industry Is Booming — Can #Blockchain Supercharge It? #Blockstation $GMBL

Posted by AGORACOM-JC at 10:11 AM on Wednesday, October 25th, 2017
  • Multi-player gaming is the king of esports and there is a belief that the blockchain can be a big benefit to its continued growth
  • video gaming industry is currently undergoing some major developments as big players are posting massive growth, with the likes of Activision BlizzardATVI +2.16%, Take-Two Interactive, and Electronic ArtsEA -0.15% (EA)

Darren Heitner , Contributor

I cover the intersection of sports and money. Opinions expressed by Forbes Contributors are their own.

Multi-player gaming is the king of esports and there is a belief that the blockchain can be a big benefit to its continued growth. Photographer: Patrick T. Fallon/Bloomberg

The video gaming industry is currently undergoing some major developments as big players are posting massive growth, with the likes of Activision BlizzardATVI +2.16%, Take-Two Interactive, and Electronic ArtsEA -0.15% (EA) posting year-to-date gains as of Oct. 13 of 70%, 112% and 51% respectively. The growth has been partly driven by the recent and upcoming releases of AAA game franchises.

Aside from big budget titles, the esports scene can be credited for much of the traction driving the industry forward. The idea of creating professional leagues out of popular multiplayer titles is catching on. Just this month, the NBA’s Cleveland Cavaliers and Golden State Warriors announced their entry into esports. They join the New York Yankees among the North American sports franchises that are buying into the growing esports scene.

Established professional sports franchises, especially soccer franchises in Europe, have been involved and invested in esports for a while now thanks to the popularity of EA Sports’ massive FIFA franchise. The emergence of other esports leagues catering to multiplayer games such as Valve’s Dota 2, Riot’s League of Legends and Blizzards’s Overwatch are also encouraging more franchises to participate.


This fusion of traditional sports and esports creates huge potential to usher in a new level of events, sponsorship, merchandise sales and betting into video games.

What makes all of this even more exciting is the introduction of blockchain into gaming. The technology that drives cryptocurrencies like Bitcoin is now finding applications in the esports ecosystem.

There are several ways new blockchain ventures like (a decentralized, blockchain-based esports community) or Network Units (a blockchain-controlled multiplayer infrastructure and integration that can turn any game into an esport) are bringing blockchain and esports together.

Ending Gamer Community Toxicity

The growth of a multiplayer game and its viability for esports depends heavily on the community. A key problem for most gaming communities is toxicity. Toxic communities are filled with members who behave negatively often characterized by abusing other members, exploiting the system and cheating. For instance, the Overwatch development team announced that it is working on measures to come down hard on toxicity after receiving complaints from its community.

Managing a multiplayer game community has its challenges. For developers, sustaining a game requires a stable infrastructure that has enough capacity to handle all transactions. It also needs transparent and fair ways to handle player conduct and reputation. As a decentralized and transparent technology, blockchain offers plenty of potential for such use.

“Gamers expect a fair match and a good challenge,” says Network Units CEO Dan Shirazi. “Sadly, most of them aren’t getting it. Cheating or broken matchmaking mechanics ruin entire gaming communities. Gamers become demotivated, stop spending on content and the full economic potential of the game is missed.”

Network Units is an online gaming platform with a built-in player reputation management. It provides decentralized and scalable computing resources to augment developers’ infrastructure and mechanisms to mitigate cheating, downtime, and costly maintenance that developers often face when using traditional means.

Network Units is also creating its own NU token cryptocurrency that will drive the economy of its decentralized multiplayer infrastructure. Using the platform, game developers can avail of resources to host their multiplayer games. Other users may contribute to the platform as service providers by renting out spare hardware and bandwidth. Players may also serve as active clients who can participate in the verification process and, by doing so, earn tokens which they then are able to use for in-game purchases.

Community Involvement and Professional Development

Gaming communities also rely on continued buzz to sustain player interest. This mainly comes from community generated content. YouTube has since been filled with gaming footage and commentaries revolving around popular multiplayer games. Streaming platform Twitch continues to experience monumental growth. In order to develop its user base, Twitch recently announced that the company is working on new tools for gamers to monetize their streams. is also working on its own blockchain-based platform to meet the various needs of esports enthusiasts. The platform aims to offer merchandise, licensed betting and esports education to its users. Its education arm, dubbed Esports University, seeks to encourage gamers to become esports professionals. Users are encouraged to create guides and video tutorials to help other gamers improve their skills.

To manage the platform, will be using blockchain to power its Esports Reward Token (ERT). Contributors of high quality content will be rewarded with ERTs which may then be used to avail of the other services within the platform. Token holders will also be able to exchange their ERTs to fiat currencies of their choice.

“Blockchain and cryptocurrency allow the decentralization of the esports world. From content creation to participation we see many solutions emerging. One major factor behind this is that users can follow and see every transaction on the blockchain, which makes everything trustworthy and openly visible for anyone. This helps not only us, but the whole industry to become more professional and grow,” said co-founder Benjamin Föckersperger.

Indeed, blockchain’s transparency could also help in restricting access to the betting functionality to prevent underage users and those with gambling problems from accessing these services.

Evolving the Ecosystem

This growing draw of esports is prompting developers to give focus to multiplayer gaming. There is much potential in games that eventually become the focus of esports leagues. The substantial market of gamers worldwide offers lucrative opportunities for established sports franchises and brands, and encourages their increased participation in esports.

For esports to succeed; however, the state of gaming communities must improve. Issues such as toxicity and low community involvement must be addressed. Fortunately, developments in technologies such as blockchain could be offering the necessary solutions to improve game services, curb toxicity and encourage participation through rewards. These new mechanisms should help the continued growth of esports.

Darren Heitner is the Founder of South Florida-based HEITNER LEGAL, P.L.L.C. and Sports Agent Blog. He authored the book, How to Play the Game: What Every Sports Attorney Needs to Know.

Follow @DarrenHeitner


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