Cross-Chain Credentials Are The Key That Will Open The Door To Multichain Web3 Gaming
Cross Chain Credentials
It’s hard to believe but Web3 gaming has been around for over a decade now, beginning with a little-known project called Huntercoin, which merged the concept of gameplay with proof-of-work mining to reward players for their in-game efforts.
Although Huntercoin was really just an experimental fork of the Bitcoin fork Namecoin, it helped to ignite a revolution in gaming. These days, there are thousands of blockchain-based games, also called Web3 games, that integrate elements like cryptocurrency and NFTs to enable players to own and trade their in-game assets and make money from playing them.
The market for Web3 gaming was valued at over $3 billion in 2023, according to a study by Crypto.com, and is projected to grow to around $65 billion and $90 billion by the end of 2030. That study shows the key drivers are an avalanche of funding for blockchain games, the growing adoption of NFTs and the innovative new business models they enable.
The game that really brought blockchain games into the limelight was Axie Infinity, which became a cult hit in the crypto world during the days of the COVID pandemic. It was one of the earliest pioneers of the so-called “play-to-earn” model, in which gamers could earn rewards every day for completing various challenges and for winning battles against their peers. At the height of its popularity in mid-2021, some Axie players reported earning hundreds, even thousands of dollars per month from the game.
Axie Infinity’s journey to become king of blockchain games wasn’t easy. It was originally built on Ethereum, but as the game grew, its developers quickly realized the error of that decision. The Ethereum blockchain was not really designed to support global-scale video games, and Axie became plagued with expensive and slow transactions that would sometimes see players paying fees in excess of $50.
To remedy this, Axie went and built its very own blockchain. It created a Layer-2 scaling solution called Ronin, built atop of Ethereum and designed specifically for the needs of its gamers. In this way, it also pioneered a multichain approach to gaming that enabled higher transaction throughput, lower costs and a better user experience. It was this decision that laid the groundwork for Axie’s explosive growth.
Although Axie Infinity’s popularity later waned, its early success underscored the enormous potential for multichain gaming, which allows Web3 games to attract a larger player base, amass greater liquidity and offset the limitations of any one, specific blockchain to enhance the overall gaming experience.
Multichain’s Identity Problem
The shift to multichain blockchain gaming solves a lot of problems, but at the same time it also introduces a new challenge around player identity. This is because of the fundamental nature of blockchains, which are siloed frameworks that exist independently of other networks. Multichain gaming requires a way for players to seamlessly move from one chain to another to ensure compatibility. If a player cannot transfer his or her gaming history, assets, achievements and experiences from one chain to another, it undermines all of the benefits multichain experiences can bring.
One of the problems that has become apparent in the DeFi industry is that, when a user switches from one chain to another, they have to verify their identity each time. It’s a frustrating, time-consuming process that also introduces greater risk, as the user has to reveal their identity credentials multiple times.
The lack of a reliable cross-chain identity has created a major obstacle for the adoption and evolution of dApps that want to explore multichain opportunities. In a nutshell, users need a way to maintain a verified identity across every blockchain they interact with, whether they’re interacting with DeFi protocols or Web3 gaming ecosystems.
Cross-Chain Credentials
This is one of the reasons why there is so much excitement around decentralized identifiers, or DIDs, which are an innovative solution that enables users to create a single, verified digital identity they can bring anywhere.
DIDs make it possible for users to verify things such as their identity, education, employment status, qualifications and reputation using cryptographic techniques, so they can avoid revealing any sensitive information about themselves. What’s more, these DIDs can move freely from one chain to another, meaning they can retain the same persona for all of their digital interactions.
The first cross-chain identity protocols were targeted at the DeFi industry, catering to the demands of institutional investors that require stronger regulatory controls, but their application in the Web3 gaming industry quickly became apparent.
One of the main movers and shakers in multichain blockchain gaming is CARV Protocol, which has created a self-sovereign identity oracle for gamers that’s based on the new ERC-7231 NFT standard. ERC-7231 NFTs have the unique ability to aggregate user’s identity information and reputations across multiple chains.
CARV says it has built an “identity of identities” with attributes including self-authentication, social overlapping and commercial value generation. One of the characteristics of these NFTs, known as CARV IDs, is that users are incentivized with crypto rewards to share their identity data and gaming experiences selectively with third-parties.
Gamers can create a CARV ID by signing up to the CARV Play platform and creating a gaming profile that they can link to any of their existing game profiles in Web3 and Web2. They can then import their entire gaming history, including their achievements and other metrics, from every game into a single identity embodied by a Soulbound Token that works across every blockchain. As users continue to play, their CARV ID profile will continuously update itself to reflect their progress.
With CARV Play, CARV is building an enormous ecosystem of games where every player has just a single identity, so they can showcase their credentials in one game to users of another entirely different game, even if it’s built on a different blockchain. There’s a big emphasis on social interaction, with users encouraged to share their most exciting gaming moments and achievements. Additionally, gamers also have the option to monetize their gaming data, sharing it with third parties such as game developers and researchers in a privacy-preserving way. When they agree to do this, players will be rewarded with cryptocurrency tokens and other digital assets.
Identity Is Everything
These developments in cross-chain identity are a much-needed innovation that can help to accelerate the Web3 gaming industry’s progress towards maturity. With players able to maintain a verified identity across any network, blockchain games have a seamless way to transition to the multichain world.
By bridging across chains, Web3 games can expand their potential audience and grow their player base to bring more liquidity into their ecosystems, encouraging the growth of a healthy, in-game economy that brings more value to every stakeholder.
