Table of Contents 🕹️
A Brief History of Games
The Games We Play
“All reality is a game.”
-Iain M. Banks, The Player of Games
I. Introduction 👾
What is a game?
Likely your definition is informed by terms such as play, players, strategies, chance, fun, etc. But similar to the thought experiment of describing a color, pinning down a definition for a game becomes increasingly difficult the longer you think about it.
Wittgenstein discusses this in his work Philosophical Investigations:
Consider for example the proceedings that we call "games". I mean board-games, card-games, ball-games, Olympic games, and so on. What is common to them all? -- Don't say: "There must be something common, or they would not be called 'games'"-but look and see whether there is anything common to all. -- For if you look at them you will not see something that is common to all, but similarities, relationships, and a whole series of them at that.
And the result of this examination is: we see a complicated network of similarities overlapping and criss-crossing: sometimes overall similarities, sometimes similarities of detail.
The difficulty becomes even more pronounced when examining the recent shift in how we play games. Recent developments in cryptoeconomics and the Metaverse are further blurring the lines on this already tenuous concept.
When looking forward to the future of gaming, one should recognize that throughout human history games have been used as a tool for community-building, with many of our most cherished traditions and cultural artifacts originating from our relationship with games.
In this week’s issue, we provide a very brief review of the history of games with a primary focus on the digital era to explore how our games, and so too our society, are evolving with our technology.
II. A Brief History of Games 👾
The earliest known traces of games can be dated back to 6,000 - 10,000 years ago. Stone and plaster slabs with rows of shallow divots unearthed in what is now present-day Jordan, Syria and Iran are believed to be some of the earliest examples of game boards. Researchers believe that these slabs were used for a mancala-style game where players would compete to capture the opponent’s pieces (which were likely seeds, pebbles, or other ad hoc items).
The first game in history researchers understand the rules to is the Game of Twenty Squares (also known as the Royal Game of Ur, since the first traces of the game were unearthed in the Sumerian city of Ur in present-day Iraq). Bridget Alex in this Discover Magazine article offers a concise explanation of the rules:
Opposing players raced five pieces, representing birds of differing values (swallow, storm-bird, raven, rooster, eagle), across the board’s 20 squares. Moves were dictated by rolling four-sided dice made from anklebones of sheep and ox.
In Egypt, the game of senet offers a fascinating example of the intimate relationship humans have with the games we create and play. According to Wikipedia:
The game was played by moving draughtsmen on a board of 30 squares arranged into three parallel rows of ten squares each. The players strategically moved their pieces based on the throw of sticks or bones. The goal was to reach the edge of the board first. Senet slowly evolved over time to reflect the religious beliefs of the Egyptians. The pieces represented human souls and their movement was based on the journey of the soul in the afterlife. Each square had a distinct religious significance, with the final square being associated with the union of the soul with the sun god Re-Horakhty. Senet may have also been used in a ritual religious context.
There are many examples of the connection humans have with our games throughout history, including gladiatorial festivities, medieval jousting ceremonies, international Olympic games, and more. For now, let’s turn our attention to the digital era to observe this relationship in contemporary times.
The First Video Games
Built in Toronto during the 1950 Canadian National Exhibit, Bertie the Brain was the first computer-based game to feature a visual display and therefore may be considered the first video game. Standing at four meters tall, the bulky machine allowed players to participate in a game of tic-tac-toe against an ‘artificial intelligence’. The game offered an adjustable level of difficulty and, to the amusement of the 1950s audience, reacted almost instantly to one’s moves. Unfortunately, Bertie was dismantled and largely forgotten about after the exhibition.
Since Bertie didn’t feature an electronic screen, the game Spacewar! is also a contender for first video game. Designed for the PDP-1 mainframe computer at MIT by a group of students, the game simulated space combat between two players. It was extremely popular in the programming community of the 1960s, partially due to its public domain source code which allowed anyone to recreate it.
Video game design on early mainframe computers was relatively limited in scope since terminals relied on teletypes rather than monitor displays. The PLATO system developed at the University of Illinois changed that, becoming host of much more visually impressive games.
PLATO was a generalized computer-assisted instruction system that supported several thousand graphics terminals distributed initially within the US, and later on worldwide. Originally intended as an educational system, its most enduring legacy is its place in the origins of online communities. Many of our modern concepts of multi-user computing were originally developed on PLATO. Forums, message boards, online testing, e-mail, chat rooms, emoticons, instant messaging, remote screen sharing, and multiplayer video games are just a few examples. Not only was PLATO host to some of the earliest iterations of today’s popular video game genres, including the first FPS (Futurewar) and first dungeon crawl RPG (dnd), but it was also the first instance where a group of people could play together simultaneously over a network connection.
The tools and games developed on PLATO formed a community that lasted for well over 20 years. The final PLATO system was retired by the FAA in late 2006.
The Birth of the Arcade
Not long after PLATO, video games took the public by storm with the birth of the video game arcade.
With origins rooted in 19th century penny arcades and the pinball machines of the 1930s, commercial arcade video games originated in 1971 with Computer Space, a game created by Nolan Bushnell and Ted Dabney, future founders of Atari, Inc. But it wasn’t until the following year, after Bushnell was inspired by a table tennis game on the Magnavox Odyssey console, that arcade video games took off with the invention of Pong.
After the commercial success of Pong, arcade video games exploded onto the scene culminating in an era now referred to as the golden age of arcade games. The golden age officially began after the release of Taito’s Space Invaders, which introduced novel gameplay features such as a persistent high score and interactive audio that increased with the game’s. Space Invaders was a huge commercial success and is considered the best-selling video game and highest grossing entertainment product of its time, going so far as to cause a rumor that the game resulted in a shortage of Japanese 100-yen coins.
A string of similar games were released over the following five years, including Pac-Man, Donkey Kong, Missile Command, Centipede, and more.
The most interesting phenomenon that occurred during the golden age arose from the construction boom of shopping malls in the US during this time. Arcades were given dedicated storefronts in malls, along with being featured in bowling alleys and skating rinks, or as standalone businesses. This led to the arcade becoming a communal gathering place for children and teens. Similar to earlier examples, humans used the gaming experience as a way to socially interact and form communities.
We would be remiss not to mention that eSports originated in the arcade era as well. Tournaments popped up in the 1980s around the persistent high score feature first introduced by Space Invaders. Life magazine even ran a cover story in 1982 that featured some of the top players at the time, bringing professional video game playing into the public consciousness.
MMOs and Early Virtual Worlds
Meanwhile in 1978, Roy Trubshaw began working on a multi-user adventure game named MUD (Multi-User Dungeon). MUD and the subsequent MUD genre of games were multiplayer real-time virtual worlds that were primarily text-based. MUDs combined elements of RPGs, hack and slash, PvP, interactive fiction, and online chat. Players read or viewed descriptions of rooms, objects, other players, NPCs, and actions performed by others within the virtual world. Players typically interacted with each other and the world by typing commands.
The popularity of MUDs ramped up in the US during the 1980s when affordable personal computers enabled role-players to log into multi-line Bulletin Board Systems and online service providers such as CompuServe.
MUDs predated future massively-multiplayer online games (MMOs), but some novel ideas about gaming and society originated in these earlier communities. For example, in 1987, Yoshio Kiya expressed his idea for an online RPG:
"[…] a system that allows total freedom for the player. For example, despite it being a sword and sorcery world, the hero decides to do nothing and just quietly enjoy his life as a local baker in town. If everyone could take up different roles in some kind of computer networked game, I think it would be really fun."
This vision for the future of gaming was emboldened by commercialization of MMOs in the 1990s. Popular MMOs during this time included Tibia, Ultima Online, and Everquest.
MMOs transitioned through a few generations before evolving to the full-scale virtual worlds that we are familiar with today.
Roblox, Fortnite, and the Origins of the Metaverse
In the midst of an ever-growing player base and an increasing amount of time spent in virtual spaces, a new concept has emerged around some of the most popular games today: the Metaverse.
Roblox and Fortnite have both garnered widespread attention for bringing the concept of a Metaverse to the public’s attention.
Fortnite was developed by Epic Games and released in 2017. Beginning as a PvE game, Fortnite ultimately pivoted to a 100 player PvP battle royale mode following the success of PUBG. Epic Games found success in releasing Fortnite as a free-to-play game supported by in-game micro-transactions, gaining 10 million players over its first two weeks of release.
Financial success aside, Fortnite became a cultural phenomenon. From hosting some of the largest concerts in the digital realm to becoming a platform for creative intellectual property to coexist, Fortnite has the foundations of some of the key themes of the Metaverse.
In fact, creative director Tim Sweeney has frequently referred to the Metaverse in discussing the future direction of Epic Games.
While Fortnite seems to have stumbled into the Metaverse, Roblox, a free-to-play platform that relies on in-game purchases made with a virtual currency called "Robux", centers around the idea. Players develop in-game experiences and socialize through the Roblox platform. As of August 2020, Roblox had over 164 million monthly active users, with over half of all children aged under 16 in the United States playing the game.
While Roblox was released in 2006, its commercial success ultimately grew out of a need for socialization during the coronavirus pandemic of 2020. Due to imposed quarantines that limited social interaction, Roblox became a medium for children to socialize with one another. One of the most interesting examples of this was the widespread phenomenon of birthday parties being hosted on the platform.
The vibrant in-game economy, unique social experiences, user-centric creation model, and the platform’s use as a tool for communicating all contribute to the idea of Roblox as an early Metaverse locale.
III. Web3 Games 👾
In the last few years, new Web3 technologies (e.g. cryptocurrencies, decentralized networks, blockchains, composable identity, etc.) have enabled us to push the boundaries of gaming even further.
Let’s explore a few examples.
It comes as no surprise to people in 2021 that investing is a form of entertainment.
As Shreyas Harihan discusses in the above linked article, communities like r/WallStreetBets have turned investing into an e-sport played between competing tribes capable of transmuting memes into value through a form of social alchemy.
Here’s one example of how mainstream investing is now: Robinhood currently holds the #1 spot on the Apple App Store, with Coinbase in second. They are followed by the popular social media platforms: TikTok, Youtube, Instagram, and Snapchat.
The Cambrian explosion of DeFi primitives and the composability of crypto gives rises to a world where anything can be tokenized and traded. Interestingly, this allows us to play sophisticated economic games.
Launched in July 2018, Aavegotchis are crypto-collectibles on the Ethereum blockchain that combine DeFi with NFTs in a novel way. From their litepaper:
Each Aavegotchi ERC721 NFT manages an escrow contract address that holds an Aave-backed ERC20 collateral, or “aToken”. aTokens generate yield via Aave’s LendingPool, which increases the quantity of aTokens held in the wallet. Thus, the amount of aTokens held in the Aavegotchi’s escrow address grows over time.
In other words, the yield-generating collateral locked in the Aave lending protocol is transformed into a collectible ghost NFT that has unique traits like Kinship and Spookiness with varying levels of rarity, which can be dressed up with unique wearables and used in minigames. These collectibles exist in the Aavegotchi Realm, a 2D pixelated universe where players participate in games and build dapps on digital land parcels.
Aavegotchi is an example of how the mediums we use to play games evolve in the Web3 world. Financial instruments transform into digital collectible pets that you can play with and trade.
Investing as entertainment evolves into gamified finance.
Web 3 will enable the ultimate MMO RPG that transcends entertainment or gaming, as a natural extension of everyday life, consuming the world…
…Our lives will be gamified to replicate the ‘Dungeons and Dragons’ experience of quests, character sheets, guilds and raids. The future of work will revolve around these new self sovereign playing fields of value and open markets.
-Peter 'pet3rpan', The Web 3 Manifesto
In short, MetaGame is a massively multiplayer online coordination game. The long-term goal of MetaGame is to create an alternative society. Players of MetaGame earn XP and level up for completing quests that move the Decentralized Autonomous Organization (DAO) closer to achieving this goal.
MetaGame utilizes SourceCred, a technology that rewards the labor of individuals as they work together in a project or community. SourceCred uses an algorithm to reward individuals based on the weights set by the participating DAO. The rewards consist of digital ERC20 currencies, typically issued directly from the DAO’s treasury. MetaGame uses this system to issue Seeds, an exchangeable ERC20, to community members as they complete quests.
But what quests are community members doing? Put simply, the quests revolve around building Web3 technologies that modify the existing socioeconomic system.
MetaGame primarily operates on Discord, Discourse, and Github, although theoretically it is played anywhere and everywhere. Ideas on what to build next pop up in the chat, are subsequently fleshed out in the forums, and then progress into the weekly calls to determine if it should be pursued further. Throughout the process, members earn XP for their contributions, which is mintable into the digital currency Seed.
In this way, MetaGame is a game organized around a meme that incentivizes contributions toward building the decentralized society of tomorrow.
It’s a Web3 game for building Web3.
Previously, we discussed the concept of a Metaverse in the context of Fortnite and Roblox. Web3 virtual worlds are decentralized versions of this same idea.
The three main Web3 virtual worlds are Cryptovoxels, Somnium Space, and Decentraland, although many Play-to-Earn games such as Axie Infinity and The Sandbox could also meet the definition.
From Andrew Steinwold:
“Today’s best examples of the scarce web are blockchain-based virtual worlds, such as Decentraland, Cryptovoxels, Somnium Space, and The Sandbox. When I use the term “scarce web platforms” in this blog I am referring to blockchain-based virtual worlds… To explain further, these virtual worlds sell plots of land for users to build anything they’d like. Users can build a social media profile where they link their photos and post their bio, or they can even create an e-commerce store. Virtual worlds are simply a 3D version of a website with the added features of native monetization and scarcity.”
These virtual worlds typically offer parceled digital space where anybody can purchase a unit of land and begin building on it. William Peaster, referring to Cryptovoxels, states that these worlds are "part real estate, part VR, part hyper-digitization, and part crypto..."
Currently, these worlds are host to crypto-art museums displaying NFTs, social experiences for community events, storefronts and headquarters for businesses, and games built within the game-worlds. Here are a few select experiences we recommend checking out to get a feel for these new virtual worlds:
Visit an Art Museum
Gamble in a Virtual Casino
Explore a Business HQ
Those who have read our previous work on the Metaverse, or those familiar with the concept from the writings of Piers Kick or Matthew Ball, understand that a primary feature of these virtual worlds is their interoperability. For example, one could access Cryptovoxels from within Somnium Space. The below video is one fascinating example of this where a player within Somnium Space opens a web browser and navigates to Aavegotchi (discussed above): economic DeFi games played in virtual reality within a virtual world space.
As discussed in our previous issue on Yield Guild Games and the Play-to-Earn Revolution, Play-to-Earn is a new innovation in the gaming industry that embraces open economies and rewards players who add value to the ecosystem through financial incentives. According to Play to Earn Magazine:
Giving gamers ownership over in-game assets and allowing them to increase their value by actively playing the game are key components of the play-to-earn business model. By participating in the in-game economy, players are creating value for other players and the developers. In turn they are rewarded with in-game assets. These digital assets can be anything ranging from cryptocurrencies to in-game resources that are tokenized on the blockchain. That’s why the play-to-earn business model goes very well together with blockchain games.
The interesting impact of Play-to-Earn gaming is that players from around the world are able to conduct a form of global labor arbitrage since some games can pay more than a doctor’s wage in some countries. Again, check out our previous newsletter on Yield Guild Games to learn more about this opportunity.
IV. The Games We Play 👾
We are trending toward a gamified future.
By 2023, the number of video game players worldwide is expected to surpass 3 billion people.
Watching gamers play video games is more popular than watching sports among 18-25 year olds.
In the U.S., one out of every two kids under the age of 16 plays Roblox.
Gaming has become the new social media, memes a form of gamified culture. But this is only the beginning.
As we spend an increasing amount of time in virtual spaces, in-game worlds are becoming hubs of culture, commerce, and community; Agoras of the digital age. Financial primitives are evolving into game pieces. Memes are becoming disruptors of traditional socioeconomic systems.
In the Metaverse, our games and reality merge. The definition draws ever further out of reach.
The gamification of everything is inevitable.
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In each issue, we’ll explore how cryptoassets, DeFi, virtual reality, and other exponential technologies are transforming our economy, society, and culture.