Thread by @0xShual

Long term, I'm bullish on NFTs. I really am.

I will take a minute, however, to dismantle this post and why I think it's way off, at least for now.

1/x 🧵

https://twitter.com/justinkan/status/1491270239967154178

This highlights exactly what's awful in today's prominent Early Access models.
The premise is: You can buy our still-in-development game for a discount, as long as you understand it's still in development.

Some games take *years* to officially launch 2/x

https://twitter.com/justinkan/status/1491270240902078465

It used to be that games were shipped when they were finished. Nowadays, it's easier for smaller studios/indie devs to fundraise *while* developing, but now they are far less incentivized to actually ship all the features and content they promised their user base. 3/x

Counterpoint: Buyer beware. That's the risk, right? Pay less, know what you're paying for.

However, many games are 'stuck' in Early Access purgatory because devs were not incentivized to ever ship the complete game.

Raising through NFTs is Early Access on nitro. 4/x

Just stating it will be so doesn't make it so. "By building the games on open and programmable assets they will create far more economic value"

This hand-waving doesn't magically spit out sustainable game economies. 5/x

https://twitter.com/justinkan/status/1491270241804222464

To design sustainable game economies, game studios usually spend many resources and iterate over time against KPIs, balance, and feedback.

Economic value can be just as easily and rapidly destroyed by mishandling checks-and-balances within the integral parts of said economy. 6/x

Putting the technical, legal, and compliance limitations aside, and they are GARGANTUAN, why would Epic ever want this?

It makes very little financial sense even when accounting for 'network effects'. 7/x

https://twitter.com/justinkan/status/1491270243008000003

When @TimSweeneyEpic talks about the metaverse, composability and interoperability, he mentions a seamless, non-transient experience where users can take their identity and possessions to different avenues across the same worldstate. 8/x

But for that to happen, there are so many technological and legal hurdles to overcome it's mind-bogglingly difficult.

NFTs can't possibly store on-chain the data it takes to render them as objects in any game, let alone a myriad of games. 9/x

I'm talking sprites, animations, textures, sound files, logic for how this all comes together. On top of that you need to specify royalties, but that touches on IP rights and enforcement. Not to mention different jurisdictions play by different rules. 10/x

Most gamers don't care for strapping economic value on their hobbies. The 'financialization of fun/everything' is a real criticism to address.

People play games because it's fun for them. They pay money expecting nothing back but entertainment. 11/x

https://twitter.com/justinkan/status/1491270244178227204

The notion of slapping economic value or forcing casual users to min/max their way of doing... everything, is far removed from what drives gamers to actually play games.

Moreover, this opens up a whole new can of worms — now a game's balance is cohesively tied to economics 12/x

Meaning P2W becomes more of a thing, something gamers absolutely loathe. Not to mention potential balance-breaking issues when allowing for external assets to be used within games.

13/x

A common saying is "imagine you spent 1k hours on a game, and now you want to take your assets into another game so your progress and money spent (aka value) is preserved", right?

14/x

Now imagine that same person hopping into your game, with boatloads of value from their previous game. Suddenly their rare helmet is now a rare gun in your game, allowing them to leapfrog everybody else. Or worse, they could dump their items on the market, destroying balance 15/x

NFTs don't also confer ownership whatsoever unless specifically stated, as the folks from @Spice_DAO learned not long ago. You can own the NFT without owning any rights to use any shred of data or derivatives of that data. 16/x

Unless they're actually interoperable outside of the games, again, putting technical limitations, data availability and legal/compliance issues aside, they are indeed a cash grab.

Players aren't happy with the shift to P2W and selling cosmetics. 17/x

https://twitter.com/justinkan/status/1491270245809819649

And added to the other bits of criticism I mentioned, it comes out as nothing BUT a cashgrab and that's why you see every major gaming community push back when their game of choice announces some sort of NFT play without involving the community beforehand. 18/x

They're not fun to play. They rely on grind, they must. (in P2E)

Great teams are indeed building, but the technological stack across the board (infra and standardization included) is still so nascent that it's a moot point. 19/x

https://twitter.com/justinkan/status/1491270247206518787

Extremely naive in my opinion. How can you put meaningful data on the blockchain that will help devs implement NFTs in their game?

How will you handle sprites, animations, textures, logic, sound? 20/x

https://twitter.com/justinkan/status/1491270248028577800

How will you handle storage when creators and users generate heaps of content and new NFTs? How will different engines and dev environments handle different NFTs made entirely differently from one another?

And ultimately, yes, the devs have the final word. 21/x

Again, the on-chain data is very limited. For anything game-ready, you'd need to store the data off-chain and then its up for anyone's interpertation.

Games are still moderated and controlled by their devs, 'backed by blockchain' or not. 22/x

https://twitter.com/justinkan/status/1491270248850280449

Only through a grassroots, bottom-up ecosystem design will you be able to overcome *some* of these hurdles and really leverage the network effect @justinkan is trying to illustrate in these points. (alpha) 23/x

Takes a short detour to shill the chain his project is on, but I'm honestly not bothered by this, aren't we all pumping our bags? Shoot your J, J.

(I too think the environmental part is exaggerated)
23/x

https://twitter.com/justinkan/status/1491270249735651329

Again. I'm very bullish on NFTs, long-term. It's just important to attack these issues from all angles to separate the signal from the noise.

We still have a long, long, long way to go. And many issues to overcome.

Many questions yet unanswered.

24/24