• George Samuels

3 Practical Business Use-Cases For Blockchain (Part 1): Nano-Payment Games

In this series, I will cover three business use-cases for blockchain that you could potentially start using or planning for today.


The three different use-cases include:

  1. Nano games

  2. Micro-content subscription

  3. Skills transfer


But today, we're going to start with nano-games and cover the following:

  1. Gamification of everything

  2. Tokenization of everything

  3. From micro to nano (games)


Let's dive in!


Gamification of everything

Second Life: the metaverse before the Metaverse

Before diving into anything blockchain, let's look at the rise of gaming culture and gamification.


Gaming became a commercial pursuit in the 1950s but has now become larger than Hollywood and the music industry combined (amounting to over $180 billion in 2021). Every 4 out of 5 households in the US own consoles, and 42% of Americans self-identify as gamers.¹


That was unheard of once upon a time.


Growing up, even my father (an engineer) thought gaming was a dead-end pursuit. He thought it was a waste of time. How quickly the tables turned in just 1-2 decades, with him now sending me articles about investing in e-sports teams 😅


But gaming (and its associated culture) hasn't stopped there. It's seeped into almost every other industry, including enterprise software, crypto, and NFTs.


At an enterprise level, gamification (as we know it today) started to take flight in late 2010. Using game elements and design to increase user engagement and motivation was a drastic paradigm shift for some. But it was Richard Bartle, a famous English game designer from 1978, who started using games in a way that could be shared virtually (aka "multiplayer").


The term gamification is said to have been coined by Nick Pelling, another British programmer and inventor.² It is now recognized as a professional field and is a multi-billion dollar industry. Just let that sink in.


For the more recent crypto and NFT industries, gaming is a staple that has led to incredibly successful games like CryptoKitties (2017), Axie Infinity (2018), CryptoFights (2020). It's the most practical use case because games have already dealt with virtual currencies for years - from World of Warcraft to Second Life to Fortnite (V-Bucks). The only difference is the "legitimacy" of currencies outside their respective game worlds.


If you'd like to dive further into the history of gaming, here's a great article from TechCrunch giving you the TL;DR version:


https://techcrunch.com/2015/10/31/the-history-of-gaming-an-evolving-community/


Tokenization of everything


An example of tokens applied on a per-device basis

So now that we've covered gaming and gamification let's look at tokens and tokenization.


"Tokenization refers to a process by which a piece of sensitive data, such as a credit card number, is replaced by a surrogate value known as a token. The sensitive data still generally needs to be stored securely at one centralized location for subsequent reference and requires strong protections around it. The security of a tokenization approach depends on the security of the sensitive values and the algorithm and process used to create the surrogate value and map it back to the original value." ~Gartner

Most currencies we use today (fiat currencies) are, in a way, tokens. They are token representations of value. In many countries, those tokens are like I-O-U-s.


The same could be said about cryptocurrencies built on top of blockchain technology. So instead of being created on physical paper (or plastic), the tokens use "the blockchain."


After Bitcoin entered the scene in 2008, people realized that the underlying blockchain could be taken out and used to create their own currencies. Even though this is illegal in most other scenarios, it took off in cyberspace and couldn't be stopped. This has now resulted in even more currencies for the world - for better or worse.


But with this proliferation, people started experimenting with the tokens for different use cases - from securities to assets to real estate. Yes, it was a solution seeking a problem, but it's undoubtedly had an impact. So much so that governments and large companies see it as a threat to stability.³


It's only a matter of time before things like "tokenized securities" overtake cryptocurrencies and other unregulated assets.⁴ Banks, governments, and other prominent players take time to adopt, but they do eventually come around, especially when it comes to things like the future of money.


So understanding this is essential for aligning your own business with where the future is headed.


From micro to nano (games)



So earlier, I mentioned a few games that have become hits in the crypto space. However, many of these games aren't leveraging blockchain to its fullest potential: micro/nano payments.


I've mentioned "nano" because they are smaller than micropayments (less than a fraction of a cent). And some blockchain-based games are starting to use them because the Play-2-Earn (P2E) model, which uses the term micropayments, has not worked as well as they thought.

Nano payment can be used for pay-per-use models and then some.


For example, instead of paying $300 for a printer, the printer could be "free" with nano-charges assessed for every page printed. Every mobile app could be funded through an in-app nano-payment system. And since we're talking about games, imagine if each action was a nano-payment.


Well, it's being experimented with already.


There's a platform called Haste Aracde, which has several nano-payment games that use ILP™ (Instead Leaderboard Payouts). It's a pretty innovative way of using the technology. Essentially, if you earn a high score in any game, you get paid by everyone else who pays to play (in nano-payments) until you get knocked off your top position.


But think about it. What other businesses could you apply this same type of thinking to? Here are some I thought of:


  1. Leaderboards for 30-day fitness challenges where you pay to enter

  2. Leaderboards for internal engagement on Social Enterprise Networks (SENs)

  3. Leaderboards for correctly identifying trolls and reporting them

  4. Leaderboards for uploading correct data into databases


Starting to get it? Good!


What other businesses could you apply "nano-gamification" to? Is there something you could start experimenting with today?


 

References

  1. The Gaming Industry Is Now Bigger Than Movies and Music Combined

  2. A brief history on gamification

  3. Cryptocurrencies Can Destabilize Nations, Hillary Clinton Wars

  4. Tokenization of Everything Is A Matter of Time

  5. Going beyond micropayments to nanopayments