> on why using credit cards for videogames is a bad idea: You trust the game owner with your payment credentials, and while this is fine when using Google, Facebook and Apple “wallets”, indie developers like us don’t have access to the same level of trust.
> For every new player in the game we create a game wallet. This is a standard Bitcoin wallet you can deposit funds via QR codes and transfer to any wallet service.
This does not check. They refuse to hold cc data on a security promise but are willing to host bitcoin wallets. Bitcoin laying around on game servers sounds like a good target to me.
They would be much better using a third party for cc payments, regarding security at least.
Think of it from the player's point of view. If you send someone not-quite-trusted or of fallible security $10 worth of btc, then the worst that can happen is you never see it again. If you give them your cc (or worse, debit card) number, then there's a chance of unauthorized charges to deal with later.
Actually the bitcoin secret key is stored in the computer of the player so with the public address and the secret key they can transfer money using bitcoin protocol directly. Even without the game.
It's got nothing to do with bitcoins. It's just an RPG with easy conversion to and from real world currency and a fond hope they can make a dynamic player-run economy work. Unfortunately...
Other games have tried the real world currency conversion, most famously Diablo 3. The consensus is that it worked horribly. And as for the dynamic economy, man, this one has been tried a lot. With mixed success, but okay, maybe they can make it work. In which case it'll be another RPG/MUD/MMO kinda thing with strong crafting/econ elements? Yay?
But again, nothing they're doing is about bitcoins. They could easily use Stripe or whatever to accept credit cards in exchange for in-game "hammercoins". And given the (sorry) very small scale they're likely to be operating at, withdrawls are not a huge problem. They could even buy bitcoins and send them to people, if all else fails. Or Amazon gift cards. Or just paypal them funds. The bitcoins is just a sprinkle of magic marketing words that doesn't impact the game. Which brings us to:
> This is a safe measure given the insane amount of stolen cards and other frauds, but this might give you a hint on why using credit cards for videogames is a bad idea
Please stop. Yes, your use of bitcoins will get you some attention and free advertising, good job. But if you're going to pretend it's actually a better solution for accepting online payments than a credit card, you're insulting us both.
Diablo III's downfall was that there were price floors and price ceilings. They set a minimum price for gold, which would be higher than its true value. This led to people selling their gold outside of the RMAH, and killed the liquidity of the in-game currency.
Items also had a maximum price limit. This meant that items worth more than $250 USD at the time had to be sold for lesser value items, or for gold (which had the downfalls listed above).
The problems with Diablo III were the restrictions on the marketplace. Blizzard never allowed prices to hit their true equilibrium, and it created an off-site black market along with other inefficiencies.
There is no reason that a game economy should be ruined in one way or another by a real-money exchange rate. There are many games where players buy & sell in-game currency for real money, where the in-game currency holds a very steady real money value.
Take Runescape for example. One million Old School Runescape Gold has been worth roughly $1 USD for the past 6 months. The volume of in-game currency which has been bought and sold in that time period is in the tens of millions of USD.
SL doesn't just allow RMT, it all but necessitates it. There is a very small list of things you can do without any L$, heres a few included in that list:
Be called a noob because you use a whole free avatar or free avatar components.
Be instantly blocked by just about everyone you try to talk to
Be unable to access adult-rated sims and regions
Spend 4 hours attached to a dancing poseball that pays you L$1 an hour
It's economy is going to fail like almost every MMORPG economy because they only cover the supply side but not the demand side. Since every item is a commodity which is mostly obtained incidentially there are a lot of sellers that sell low quantities of that item. They don't care a lot about losing a bit of money they want liquidity. there is usually a limit on simultaneous sell orders which means you cant sell anything at all if you don't prioritise liquidity or have high quantities. The easiest way to quickly sell your items is to just price your item lower than everyone else. When everyone is doing this the value of the commodity is quickly plummeting far below the price most buyers are willing to pay. Heck I've seen items that cost less than the money NPCs would give to you (premium users can access the market place anywhere outside a city and they dont want to go to the NPC) This gives rise to traders that buy these cheap commodities and then sell them for the market clearing price. The simple solution would be to just reflect the demand side as well. Allow players to issue buy orders like "I want x of item y. I pay z for each." on the central marketplace. Those who need liquidity get it and those who want fair prices to sell their items at get them too.
It sounds like you are speaking about the deficiencies of some particular game, this certainly isn't true of all MMOs. GW2 and Eve both support buy orders, for instance. Items that drive the economy are also not always obtained incidentally, often they must be crafted by someone with high enough skill using rare components.
Given that the In-Game currency is purchasable with fiat currency, wouldn't it be reasonable to surmise that hyperinflation doesn't occur in the same way due to the fiat anchor for IG currency values?
Only if it goes both ways. The ability to purchase in-game currency with fiat currency actually makes inflation worse by introducing even more money to the in-game economy. Most games currently do not allow in-game currency to be "legally" converted back to real world money directly. Their solution is the ability to convert large amount of in-game currency to meaningful metagame items. In Eve, you can use in-game currency to pay for your subscription. In GW2, you can use in-game currency to pay for "gems", which are used for microtransactions such as server transfers, rare skins, additional bank storage, etc. These gold sinks serve as an important valve to control inflation of the economy by permanently removing that currency from the game.
Extra creditz just published an excellent video on why auto-generated vendor-sellable items lead to hyperinflation under most circumstances, and a few ways to avoid it: https://www.youtube.com/watch?v=sumZLwFXJqE
| When buying from a player, the player bot will try to resell the same item for double the price.
Given this, and assuming auto-buy from vendorbots, I'd predict the second they open the game for auto-grinders (or puppeteered bots) to appear, kill anything in sight, sell stuff, pump any bitcoin any vendorbot might hold, until the game economy holds no more bitcoin. It's probably more CPU-efficient, than mining bitcoin; and there's a manual workforce readily mobilizable for it.
The game looks really promising, and I'd love to grind a few hours in it as it stands, but I'm not sure if dropping a bitcoin dependency into it won't sink it prematurely.
My most favorite video game economy was Habbo Hotel, actually. Because few people actually bought coins, people were caught in a deflated economy almost constantly. And since special events or buying furniture from the store was the only source of supply for the demand, a whole economy formulated around furniture for coins, etc. I just thought the dynamic was neat.
Additionally, Spiral Knights also had an interesting model -- access to levels was gated by something called "Energy," and you were given a cap and a given regeneration rate for energy up to that cat. "Crystal Energy" could be bought for real money and exchanged for in-game money, so it was an interesting deal -- the game created an automatic sink for money in energy.
I would like to see a game that tests the gold standard approach. Basically a novel economic simulator. The hard part would be building a fun enough game around it, I'm currently thinking some sort of sandbox game/MMORPG.
Upon the creation of the game world a fund of X money would be set aside and correspond to all available in game items etc.
For each paying player, new items would be added that correspond to a percentage of their fees.
You could sell the items directly to the game bank for real money. No inflation so there's a limited number of items available and only if a new player signs up will new items be added.
You could probably even test player characters retiring at a certain level. Say you grind up to level MAX and essentially solved the game...click retire and you get refunded all the money that your items etc. are worth (and start the grind again if you want)
> I would like to see a game that tests the gold standard approach.
Bitcoin is that experiment, but in the real world. After ~2021, the inflation rate will be less than 1.8% p.a. [1]. I believe the stock-to-flow ratio of gold is around 1% (its stock/supply increases around 1% per year). So they will be pretty similar in that regard in ~5 years, and in addition, we won't need to worry about whether our experiment actually reflects real-world conditions, as opposed to with a game.
So semi-related to this, I've contemplated about the feasibility of a cryptocurrency/blockchain built specifically for a pseudo-MMO game where instead of a central server, it's actually a network of servers where anyone can host a server. Each server would be a "game world" that falls into a few categories, such as PvE, PvP, and Town, where Town would be a sort of server browser to find PvE/PvP servers.
The blockchain would store users' character data i.e. level, currency, inventory, etc.
It would use a hypothetical form of proof of work where either the previous hash or the nonce would determine what monster and items are available on that server for some given amount of time. Clients would then be required to sign with their private keys a "chain of events" that would have to line up with the server's chain of events somehow.
I wouldn't know how to determine if a client and a server are cheating or not though.
The game developer would imaginably host some of the larger servers and could then sell the cryptocurrency they gain from hosting said servers for some actual fiat as a means to make money.
Clearly this is an incredibly rough idea that I have not actually spent too much time thinking about.
EDIT
an inspiration for this idea was "The World", a fictional game from the dotHack series
Don't be fooled by a few utterances of the word "Blockchain". This could still be exploited by the game owners, who have control of the drop rates and enemy interactions (i.e. there are still centralized aspects of this environment). There are several elementary typos in that article -- so it makes me trust the game creators even less. This reeks of typical MMORPG developer greed.
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[ 5.6 ms ] story [ 73.0 ms ] thread> For every new player in the game we create a game wallet. This is a standard Bitcoin wallet you can deposit funds via QR codes and transfer to any wallet service.
This does not check. They refuse to hold cc data on a security promise but are willing to host bitcoin wallets. Bitcoin laying around on game servers sounds like a good target to me.
They would be much better using a third party for cc payments, regarding security at least.
Actually the bitcoin secret key is stored in the computer of the player so with the public address and the secret key they can transfer money using bitcoin protocol directly. Even without the game.
It's got nothing to do with bitcoins. It's just an RPG with easy conversion to and from real world currency and a fond hope they can make a dynamic player-run economy work. Unfortunately...
Other games have tried the real world currency conversion, most famously Diablo 3. The consensus is that it worked horribly. And as for the dynamic economy, man, this one has been tried a lot. With mixed success, but okay, maybe they can make it work. In which case it'll be another RPG/MUD/MMO kinda thing with strong crafting/econ elements? Yay?
But again, nothing they're doing is about bitcoins. They could easily use Stripe or whatever to accept credit cards in exchange for in-game "hammercoins". And given the (sorry) very small scale they're likely to be operating at, withdrawls are not a huge problem. They could even buy bitcoins and send them to people, if all else fails. Or Amazon gift cards. Or just paypal them funds. The bitcoins is just a sprinkle of magic marketing words that doesn't impact the game. Which brings us to:
> This is a safe measure given the insane amount of stolen cards and other frauds, but this might give you a hint on why using credit cards for videogames is a bad idea
Please stop. Yes, your use of bitcoins will get you some attention and free advertising, good job. But if you're going to pretend it's actually a better solution for accepting online payments than a credit card, you're insulting us both.
I think that supports my overall point though: This isn't new, and you don't need bitcoins to make it work.
Items also had a maximum price limit. This meant that items worth more than $250 USD at the time had to be sold for lesser value items, or for gold (which had the downfalls listed above).
The problems with Diablo III were the restrictions on the marketplace. Blizzard never allowed prices to hit their true equilibrium, and it created an off-site black market along with other inefficiencies.
There is no reason that a game economy should be ruined in one way or another by a real-money exchange rate. There are many games where players buy & sell in-game currency for real money, where the in-game currency holds a very steady real money value.
Take Runescape for example. One million Old School Runescape Gold has been worth roughly $1 USD for the past 6 months. The volume of in-game currency which has been bought and sold in that time period is in the tens of millions of USD.
Source: I run http://r2pleasent.com - a site that buys and sells in-game items.
Be called a noob because you use a whole free avatar or free avatar components.
Be instantly blocked by just about everyone you try to talk to
Be unable to access adult-rated sims and regions
Spend 4 hours attached to a dancing poseball that pays you L$1 an hour
| When buying from a player, the player bot will try to resell the same item for double the price.
Given this, and assuming auto-buy from vendorbots, I'd predict the second they open the game for auto-grinders (or puppeteered bots) to appear, kill anything in sight, sell stuff, pump any bitcoin any vendorbot might hold, until the game economy holds no more bitcoin. It's probably more CPU-efficient, than mining bitcoin; and there's a manual workforce readily mobilizable for it.
The game looks really promising, and I'd love to grind a few hours in it as it stands, but I'm not sure if dropping a bitcoin dependency into it won't sink it prematurely.
Additionally, Spiral Knights also had an interesting model -- access to levels was gated by something called "Energy," and you were given a cap and a given regeneration rate for energy up to that cat. "Crystal Energy" could be bought for real money and exchanged for in-game money, so it was an interesting deal -- the game created an automatic sink for money in energy.
Upon the creation of the game world a fund of X money would be set aside and correspond to all available in game items etc. For each paying player, new items would be added that correspond to a percentage of their fees. You could sell the items directly to the game bank for real money. No inflation so there's a limited number of items available and only if a new player signs up will new items be added.
You could probably even test player characters retiring at a certain level. Say you grind up to level MAX and essentially solved the game...click retire and you get refunded all the money that your items etc. are worth (and start the grind again if you want)
Bitcoin is that experiment, but in the real world. After ~2021, the inflation rate will be less than 1.8% p.a. [1]. I believe the stock-to-flow ratio of gold is around 1% (its stock/supply increases around 1% per year). So they will be pretty similar in that regard in ~5 years, and in addition, we won't need to worry about whether our experiment actually reflects real-world conditions, as opposed to with a game.
[1] https://en.bitcoin.it/wiki/Controlled_supply
The blockchain would store users' character data i.e. level, currency, inventory, etc.
It would use a hypothetical form of proof of work where either the previous hash or the nonce would determine what monster and items are available on that server for some given amount of time. Clients would then be required to sign with their private keys a "chain of events" that would have to line up with the server's chain of events somehow.
I wouldn't know how to determine if a client and a server are cheating or not though.
The game developer would imaginably host some of the larger servers and could then sell the cryptocurrency they gain from hosting said servers for some actual fiat as a means to make money.
Clearly this is an incredibly rough idea that I have not actually spent too much time thinking about.
EDIT
an inspiration for this idea was "The World", a fictional game from the dotHack series