This editorial article is a part of Web3 Month of Technical.ly's 2022 editorial calendar.
To Nerd Street Gamers CEO John Fazio, cryptocurrencies and nonfungible tokens are a more than natural next step for the esports industry.
Gamers have been dealing with in-game purchases and digital assets for decades, he said, and being able to pay in crypto was one of the most highly-requested features the Philly company heard about from its members. Both ticketing and payouts for tournaments will have a crypto option moving forward, thanks to a partnership with FTX US, a US-regulated cryptocurrency exchange platform, that begins in February.
The partnership will allow Nerd Street to accept crypto payments, offer crypto payouts to its users, and use additional future blockchain-related features. Fazio said the company will also roll out its first NFTs, too. Gamers will get digital trophies handed out as prizes for its summer championship.
“I think NFTs have gotten a bad rep. A lot of people are rejecting the notion of it. And I think a lot of that is fair. The crypto scene is 99% percent bullshit, like it’s nonsense or get rich quick schemes,” Fazio told Technical.ly. “To me, this feels exactly like the internet in the ’90s, it’s exactly like mobile tech. I remember when the internet first came out, people were saying, ‘We’ll never be able to game online because the latency’s too slow.’ It’s all the same things I hear of NFTs now, and I think it’s natural when a new technology comes out to resist it, but over the long term, there’s too much value in NFTs and digital assets and items.”
So the company will focus on their intrinsic value, and the NFTs earned in the championship will be representative of the experience they had, Fazio said. The only people who will get access to the NFT are the people who participated in the event. It’ll allow the players to differentiate themselves and make it about earning something.
“FTX US has a strong focus on making sure our industry — crypto — is a safe, accessible place for all types of people,” said Brett Harrison, president of FTX said in a statement. “That’s why as a gamer and esports fan, I’m proud to support Nerd Street’s mission likewise to bring esports to everyone. Their platform is unlocking a massively untapped market of gamers that want to participate but lack access and we’re excited to support their growth.”
We're going to see more value creation in the normal, non-crypto businesses that leverage crypto, which is how we see ourselves.
Future blockchain technology development could allow companies like Epic and Riot to make more money opening their ecosystems via a more connected metaverse. Fazio predicts most games will likely incorporate NFTs that you can leave the game with into their models in the next five or so years.
FTX was really aligned on that idea of intrinsic value, Fazio said, which is why they ultimately partnered with the brand for this expansion into harnessing blockchain technologies. Long-term, the real winners of Web3 won’t be the Web3 companies, he said. They’ll likely be the companies that had existing operations that use the internet to accelerate what they’re doing.
“We’re going to see more value creation in the normal, non-crypto businesses that leverage crypto, which is how we see ourselves,” he said.
Most companies won’t benefit from jumping on the bandwagon if their business doesn’t have value in decentralized databases, he said — not everyone that needs to get on board. The ones that will succeed are using blockchain technologies in order to ensure integrity and trust like real estate titles or insurance. It comes down to needing decentralization, he said.
The company plans to raise a Series B some time this year, though they reportedly don’t need the cash flow: Fazio said they’re more focused on a long-term partner who understands the company’s vision. Nerd Street’s HQ, a new space on North Broad Street, is still underway, though its flagship facility, The Block, launched to the public in the fall. In 2021, the company hosted more than 500 tournaments that broadcast to 4.8 million viewers and its platform hosts about 10,000 monthly active users.
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