Square Enix Reveals Its Blockchain and non-fungible tokens (NFT) Strategy
While the announcement is brief in its details,
it demonstrates the company's interest in blockchain gaming.
Significant Points to Ponder
* Square Enix's CEO announced the company's strategy for non-financial tokens,
blockchain-based games, and the Metaverse.
* President Yosuke Matsuda dubbed 2021 "year one" for NFTs and suggested that
as the technology becomes more prevalent, prices will correct.
* According to the CEO, in 2022, blockchain will be a "significant strategic theme."
Square Enix, a game developer, announced plans for blockchain and
near-field communication (NFT) development on New Year's Day.
NFTs and the Metaverse: A CEO's Perspective
Square Enix announced its plans to develop blockchain, NFT, and Metaverse initiatives
this weekend in a letter from company president Yosuke Matsuda on New Year's Day. Matsuda noted
in the letter that last year, non-fungible tokens, or NFTs, drew considerable attention.
Due to the rapidly growing user base of NFTs, he dubbed 2021 "year one."
Matsuda acknowledged that NFTs have increased the liquidity of digital goods,
but noted that NFT trading has become somewhat "overheated" and speculative in nature.
Matsuda anticipates that as NFTs become more prevalent, price corrections will occur.
Matsuda also brought up the Metaverse, the virtual reality trend that Facebook sparked in October.
He expressed hope that as the Metaverse concept takes shape,
it will "induce changes that have a more significant impact on Square Enix's business."
This Year Will Begin the Implementation of a Blockchain Strategy
Matsuda made no specific NFT or Metaverse product announcements.
He did mention, however, that Square Enix developed a medium-term strategy in 2020
that would prioritise investments in artificial intelligence, cloud gaming, and blockchain games.
He added that "starting in 2022, Square Enix will
make decentralised blockchain games a major strategic theme."
Matsuda explained that games that incorporate blockchain tokens can offer players incentives
to play while also rewarding users for creating user-generated content for those games.
Square Enix has faced public backlash,
as has a number of other corporate NFT strategies. Users have criticised NFTs
as faddish and expressed concerns about blockchain mining's environmental impact.
The Cryptocurrency Gaming Industry Is Growing in Popularity
Prior to March 2021, Square Enix created a series of NFTs for its Million Arthur franchise.
These NFTs did not contain any game content, but rather contained digital artwork.
Additionally, the company invested $2.01 million in Animoca Brands in 2020,
the company behind the blockchain VR game The Sandbox and other blockchain games.
Square Enix is one of a growing number of video game companies exploring blockchain technology.
Ubisoft recently announced the launch of its own near-field communication (NFT) platform.
Meanwhile, EA and Epic Games have indicated an interest in the technology,
and GameStop is developing its own NFT marketplace.
Other companies, such as Steam, have outright prohibited crypto and NFTs,
while others, such as Xbox, are cautious.
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