Gaming powerhouse SEGA Corp. — known for iconic franchises such as Sonic The Hedgehog and Yakuza — has opted to withdraw from the play-to-earn market.
The company’s decision comes in the wake of a turbulent crypto industry and dwindling player interest in blockchain-based gaming, popularly known as GameFi.
SEGA Pauses Ambitious Play-to-Earn Plans
SEGA’s Co-Chief Operating Officer Shuji Utsumi underscored the seismic shift in strategy for the venerable firm. He opined that play-to-earn games are “boring,” questioning their merit if they do not deliver on the fundamental promise of fun.
“For the majority of people in the video game industry, what blockchain advocates say may sound a bit extreme, but that is how the first penguin has always been,” said Utsumi.
Firms like Square Enix and Bandai Namco, alongside SEGA, previously endorsed the blockchain-based technology that it hoped would enhance the allure of its titles. However, the implosion of the crypto market has resulted in a significant drop in the appeal of GameFi.
Utsumi noted a reluctance to pledge SEGA’s major franchises to third-party blockchain projects. He fears that such moves could dilute the value of their content. Instead, the company will cautiously continue to dabble in blockchain technology.
SEGA will allow lesser-known franchises like Three Kingdoms and Virtua Fighter to be used for non-fungible tokens (NFTs). This is a controversial move that initially faced widespread backlash from eco-conscious gamers.
Blockchain Technology Experimentation
SEGA’s blockchain experimentation will persist, albeit on a lesser scale.
Utsumi highlighted potential applications of the technology that could provide significant benefits. These include enabling the transfer of characters and items between different games.
Reflecting on the larger picture, this move from SEGA signals a general cooling trend on Web3 concepts. As the technology continues to mature, SEGA’s position may evolve.
“We are looking into whether this technology is really going to take off in this industry, after all,” added Utsumi.
Still, the company’s focus appears to be on reinforcing the intrinsic entertainment value of its games over the speculative allure of blockchain technology.
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