By investing in blockchain gaming infrastructure, the large game developer is changing its business model to include a more powerful NFT ecosystem.
In its first-quarter earnings report, Square Enix said that it will add nonfungible tokens (NFTs) to new games in 2022 as part of its long-term business plan.
Square Enix (SE) is a $3 billion gaming company in Japan, according to its most recent financial report. The company owns the Final Fantasy series and bought the Tomb Raider property on May 3 for $300 million.
It is said that the company began testing NFTs on the Shi-San-Sei Million Arthur game in February of this year. If the pilot program is successful, the NFTs in the game will be able to come back for a second season, and the company will eventually try to do more business in the NFT and blockchain industries.
As a top priority for its blockchain domain initiatives, SE plans to set clear legal rules and standards for blockchain gaming, deal with scalability in NFT economies, and look into the formation of a corporate capital venture unit.
The company also said that it would set up an offshore organization to handle the “issue, management, and investment of our tokens.” This suggests that it will build a large economy based on gaming tokens.
SE has been working with Web3 Games and Animoca Brands, a metaverse venture capital firm, to find out how well it could do in the blockchain gaming market. As SE learns more about the ecosystem, it is likely that the relationship between the two businesses will grow.
Yat Siu, the executive chairman of Animoca, thinks that Square Enix’s popularity in the game industry will help the company get started in blockchain gaming. He told Cointelegraph on Monday:
“Square Enix has already been talking about the potential of blockchain games for a long time, so it gets it better than most of the traditional gaming giants out there.”
The third goal of the report’s business strategy for the next five years is to invest in blockchain, artificial intelligence (AI), and the cloud and make money from them. This fits with what CEO Yosuke Matsuda said in January when he said he wants his company to do more with these technologies.
Even though the crypto market crashed, Web3 and NFT games are still very popular until 2022. The market tracker DappRader says that on January 1 and Saturday, there were 1 million daily active gamers.
The total amount of money spent on NFT gaming items has gone down by 88 percent, from $70 on January 1 to $8.7 million on Saturday.