Crypto Exchange FTX is launching a new team focused on driving the adoption of cryptocurrency and non-fungible tokens (or NFTs) in the gaming world, according to a Bloomberg report.
The initial offering of the new gaming unit would be a “crypto as a service” platform through which game publishers can launch tokens and provide support for in-game NFTs.
“We are launching FTX Gaming because we see gaming as an exciting use case for crypto,” an FTX spokesperson told Bloomberg via email. “There are over 2 billion gamers worldwide who have played with and collected digital items, and can now own them as well.”
FTX’s new gaming-focused team is a sign of the continued drive to introduce blockchain-based products to the gaming space, as evidenced by projects such as GameStop’s own NFT Marketplace. But although game developers and retailers see crypto tokens and NFT items as a promising source of revenue, gamers have expressed widespread skepticism about the need for blockchain technology.
Over the past few months, various game publishing companies have been forced to cancel proposed NFT projects after fan backlash, which has largely stemmed from opposition to new forms of premium downloadable content that are seen as offering little additional value to players. Other blockchain critics point out that there are already many established marketplaces for trading in-game items, making the value proposition of cryptocurrency bonds unclear.
Brett Harrison, President of FTX US, said The edge that the company believes blockchain technology can build on existing gaming functionality without hurting the experience of players who are hesitant to adopt it.
“I think the backlash is mostly because the focus on cryptocurrency will distract game studios from creating the best possible game for gamers,” Harrison said in an email. “We believe that blockchain technology takes features of games that already exist, such as avatars, skins and in-game rewards, and allows players to own, invest and trade these items outside of the game. But the enjoyment of the game for all players, including those who do not wish to participate in these kinds of economies, should always be the main goal, whether blockchain technology is involved or not.
For the FTX exchange, the attempt to build collaborations with game developers is another part of its foray into the cultural space. The company was behind the recent launch of a Coachella Festival NFT Marketplace, where photographs, posters and lifetime festival passes were sold as NFTs. This year’s Super Bowl viewers will also have seen ads from FTX, which was one of many crypto companies vying for the attention of football fans.
After closing a $400 million funding round in January 2022, the company became one of the most valuable private crypto companies in the worldand claims to be the third largest exchange by trading volume.
FTX’s international operations were moved from Hong Kong to the Bahamas in September 2021, citing the Caribbean nation’s supportive and comprehensive regulatory regime – although job openings for the gaming unit are currently listing under FTX US, the company’s US subsidiary.
Updated at 1:25 p.m. ET to include the statement from FTX US.