NFTs are a major point of contention among gamers and developers in the modern online gaming space. While some believe they represent new and innovative avenues for revenue, others see them as unnecessary, risky investments that may require undue amounts of energy to maintain.Publishers like Ubisoftand GSC Game World were met with an incredible amount of pushback when they announced plans to introduce NFTs to upcoming games, and some governments are now taking action to better regulate the practice.
South Korea’s Game Management Committee recently requested thatmobile app marketplaces like Google Playand Apple’s App Store block any new play-to-earn releases which require prerequisite NFT purchases to play. They have also moved to delist current and upcoming play-to-earn games by denying them age ratings, which are required on South Korean digital app storefronts.
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The South Korean government’s concern surrounding these new gaming practices likely stems from their association with gambling and what they’ve termed “speculative money-making schemes.” Games which offer cash prizes or other funds that can be directly exchanged for cash are heavily regulated in South Korea, and in-game monetary rewards in the country are prohibited from exceeding 10,000 Korean Won, which equates to slightly more than 8 USD.
These regulations stemmed from the rise in popularity of a slot machine-adjacent game called Sea Story in South Korea in the mid 2000s. Sea Story did not yield direct monetary rewards, instead offering gift certificates to avoid further government involvement. However, third-party storefronts and marketplaces which exchanged these certificates for cash were soon popularized, and this eventually lead to a significant boost in organized crime. Understandably, the South Korean government is now wary of allowing similar practices to take root.
This affair echoes issues experienced recently in Western countries; in 2020, Belgium and The Netherlands banned most forms of loot box in-game rewards, and someless-restrictive actions were also taken in the United Kingdomand the United States. Yet, with Ubisoft pushing its new Quartz initiative and EA’s CEO stating that NFTs will be important to the future of gaming, it seems as if most governments are too slow to keep up with ever-changing trends.
It’s worth noting that, while South Korea seems to be starkly against NFTs playing a role in video gaming, blockchain technology and cryptocurrency are thriving in the country—a major contrastwhen compared to China, where cryptocurrencies are banned. The government’s Game Management Committee believes the perceived anti-blockchain stance is a “misconception” and stated that its goal was to prevent “speculation,” not to inhibit new and lucrative technologies.
