Blockchain is fast becoming a household word, seeing the impact it has had on virtually all industries in the world. To push its adoption, blockchain needs industries like gaming, which have a higher likelihood of being widely accepted than its finance-only usage. This has worked, given the influx of hundreds of thousands of gamers using the first set of blockchain games built.
While this was great for blockchain adoption, it raised eyebrows about a pending issue with blockchain technology: scalability. The first known blockchain game, cryptokitties, experienced this issue from inception when more than 30% of Ethereum transactions were due to the game. The result was slow transactions and increased gas fees to perform those transactions.
Several solutions have been worked out so far. This article will go through some of the solutions adopted by some games and the merits of them. Before that, I will give brief definitions of terms associated with blockchain gaming and explain scalability and its relevance in blockchain gaming.
Terms Related to Blockchain Gaming
This is a decentralized ledger that allows the immutable storage of an infinite amount of data. It is suitable for blockchain games as it possesses features like programmability, interoperability, verifiability, accessibility, and immutable transparency.
To ensure accurate transactions are recorded on the blockchain ledger, different mechanisms are put in place to verify transactions and avoid double-spending. The popular ones are Proof of Work (PoW) and Proof of Stake (PoS). As will be seen in this article, others exist that have proven better, like Proof of Authority (PoA) and Delegated Proof of Stake (DPoS).
This is a postulate applied to the blockchain that states that, in any blockchain, it is not possible to have all three pertinent features, namely security, decentralization, and scalability, coexisting in their full capacities. If two are optimal, it would be at the sacrifice of the third. For example, if the blockchain is highly secure and fully decentralized, it would not scale well.
Non-Fungible Tokens (NFTs)
These are digital assets that cannot be interchanged for similar items. It exists in different forms, including art, game collectibles like swords, skins, and pets, etc. By virtue of NFTs, gamers have the opportunity to own their digital collectibles even outside the game, potentially use them in other games, and sell them in NFT marketplaces like Opensea.
These are games built on a blockchain to take advantage of its features. As such, gamers can own game collectibles (NFTs) or tokens outside of the game and buy or sell them via fiat currencies.
This is a name that comes from amalgamating the terms, “gaming” and “finance”. It is a more accurate representation of blockchain gaming since it combines the gaming world with that where profits and earnings can be made. Its most popular type is the Play-to-Earn (P2E) model, where players can earn tokens or NFTs as rewards for playing the games.
This is the ability of a system to continually tweak its consensus mechanism and adjust its system characteristics to achieve greater transactions per second (TPS) with the increasing numbers of users of the system. In other words, if the speed and cost of transactions remain fairly constant with a growing number of users at the same time, the system is said to be scalable.
Scalability is important if blockchain games are to compete in terms of speed and efficiency with the traditional centralized gaming systems. It can thus be rephrased that if a blockchain game does not scale, it won’t stand the test of time. It would be subject to increasing cost, slow transaction processing time, and slow gaming speed with an increasing number of players. However, on the issue of the blockchain trilemma (creating a balance between scalability, decentralization, and security), scalability has been the toughest part to achieve.
Some Scalability Solutions Embraced by Blockchain Games and Their Merits
In order to scale, several solutions have been proposed to be used on the blockchain. They are broadly classified into two types:
Layer 1 solutions: consensus-based redesign, sharding, hard forking, etc.
Layer 2 solutions: the use of sidechain, state channels, plasma, roll-ups, etc.
Layer 1 Solutions for Gaming
Layer 1 solutions are those that involve redesigning the base protocols of the blockchain networks to allow for throughput, cheaper transaction fees, and energy efficiency. It is generally referred to as “on-chain solutions.” A typical example of a layer 1 solution is Ethereum trying to solve its scalability issue by resigning its consensus mechanism in the soon-to-be-released Ethereum 2.0.
In deciding to stick with layer 1 solutions, most blockchain game developers choose a blockchain that can scale properly based on their consensus mechanism. As such, they stick with those with redesigns from the usual PoW mechanisms used in popular gaming platforms like Ethereum that are relatively slow. Doing so has led to some games being built on some of the blockchains that will be discussed below with their obvious merits. They include:
Alien Worlds, one of the most popular games in the space, is built on a blockchain that uses a redesigned consensus mechanism that allows it to scale, the Worldwide Assets eXchange (WAX) Blockchain. It is evidently built to accommodate the scalability issues with blockchain games. It uses the Delegated proof of stake mechanism, which is over 125,000X more efficient than the PoW mechanism used in Bitcoin and Ethereum. For the merits outlined below, several games opt to use the Wax blockchain for their projects. Some other popular games that did this are R-Planet, Kolobok Adventures, and over 60 other games.
Merits of Using WAX’s Scalability Solution
- It can process more than 15 million transactions daily with a daily user rate of over 300,000 users and is capable of handling more. This allows it to handle the gaming functions. It also allows it to handle its transactional functions as gaming collectibles and tokens are bought and sold in thousands of affiliated dApps and NFT marketplaces
- It is more energy-efficient as it uses less than 0.00001% of the energy of Proof of Work chains.
- It supports staking, for which the WAX community can transact with zero fees and unlimited opportunity
Mobox: NFT Farmer has been one of the most successful blockchain games of the last year and has been built on the Binance Smart Chain (BNB). BNB is a product of modifications to the Ethereum blockchain. It combines the Proof of Authority (PoA) and Delegated Proof of Stake (DPoS) mechanisms to provide a highly scalable blockchain network. As a result, it is significantly more efficient than the Ethereum blockchain with the same advantages. Due to its merits, as outlined below, several blockchain games have also built their games on the BSC blockchain. They include Squid NFT World, Battle Pets, and over 430 other games.
Merits of Using BSC’s Scalability Solution
- Lower transaction fees regardless of transaction volume when compared to Ethereum
- High speed of transaction completion (generally 3 seconds)
Layer 2 Solutions for Gaming
Most gaming applications that hit the scalability issue still resort to layer 2 solutions to scale further. It basically involves scaling by the use of a secondary chain that is linked to the main blockchain. To make it easier, some side chains are built for scaling games on other blockchains like Immutable X, for example.
Some layer 2 solutions are:
Purpose-made for Axie Infinity, arguably the most famous blockchain game, originally built on Ethereum.
In February 2021, the game had 27,000 players who were earning AXS and SLP, its game rewards. With that number of players, scaling became an issue. The Ethereum gas fees increased, and it led to slower transactions. To curb this issue, the development team decided to build an Ethereum sidechain called Ronin and move the game.
Unfortunately, a recent hack saw over $600m stolen from the Ronin bridge.
Merits of Using Ronin as a Scalability Solution
- Fast and seamless transactions with close to instant confirmations
- reduced transaction fees
- Thanks to the Ronin bridge, Axie assets can be withdrawn and transferred without limitations
- Built especially to meet the scaling demands of gaming
Illuvium is looking to be the first AAA blockchain game and opted against building their own sidechain, instead deciding on Immutable X, a layer 2 solution.
Immutable X is a gaming platform that integrates with the usual NFT marketplaces. It is built on top of Starkware’s layer 2 scaling technology. Using Immutable X, games built on the Ethereum blockchain can stay there and enjoy the various benefits, without sacrificing scalability or liquidity. With this powerful integration with Immutable X, the players of Illuvium profit from near zero gas fees, instant trades, and high scalability for their NFT and token trades. By implementing zero-knowledge proofs, the Immutable X sidechain doesn’t have access to anyone’s private keys so that players remain in control at any point in time.
Merits of Using ImmutableX as a Scalability Solution
- Improved scalability; ImmutableX can handle over 9000 transactions per second
- Zero gas fees
- Significant ease of minting and trading NFTs on the Ethereum network
Blockchain games are a large part of the future of blockchain technologies, especially being a key to the upcoming metaverse. Using layer 1 and layer 2 solutions, and sometimes a combination of both, has helped blockchain games scale. With that, blockchain games stand a chance in competition with traditional games, as they improve in speed and efficiency, eventually leading to a merging of the two. This gives gamers ownership of their gaming items and currencies in addition to the other series of benefits they derive from playing games.