While the first wave of crypto gaming projects were very much focused on real money gambling, over the past few months, there have been a number of moves aimed squarely at the social gaming space.
So what is social gaming?
Put simply, social gaming, sometimes referred to as social casino, are free-to-play versions of popular games including poker and slots, where players wager virtual chips instead of real money.
Social gaming operators attract millions of users around the world, particular on mobile devices via platforms including Facebook. They make money by selling in-game benefits, virtual chips and other add-ons.
It is a sector that has absolutely exploded over the past few years. According to Statista, in 2018 the sector will be worth almost $6 billion.
Global social gaming revenues 2016 – 2022
Crypto gambling projects are now taking a serious interest in social gaming.
In March, CashBet Coin announced a partnership with Greentube’s GameTwist social gaming platform.
Greentube is the online division of Novomatic, one of the world’s largest gambling companies. One of its subsidiaries, FunStage, runs a major social gaming platform used by millions of users around the world. The deal meant that users playing social slots, casino, card games and bingo on the GameTwist platform could use CashBet Coin to play with.
More recently, Edgeless announced the launch of Hotheads.io, a social casino platform powered by the EDG token. KamaGames, the social casino giant behind the popular Pokerist games, also announced its entry into crypto with an ICO aiming to raise $25 million.
Blockchain and cryptocurrencies are a perfect match for social gaming.
There are several major upsides for gaming-focused cryptocurrencies to explore opportunities in the social space.
Perhaps top of the list is activity. Generally speaking, all cryptocurrencies live or die on adoption. If the challenge for the likes of CashBet Coin, Edgeless and others is to get people to use their coin, social is a great place to start. It is tough to know the number of people worldwide who play social casino, but many estimated put the number well above 1 billion. It is certainly a larger number than traditional gambling; look around next time you are on a bus or a train, and there is a good chance you’ll spot a handful of people playing Candy Crush or another social title on their phones.
The second key advantage is to do with regulation. The barriers for entry in the real money gambling space are high. In mature markets such as the UK, or highly regulated ones like the US, offering real money gambling, even via blockchain technology, can lead to all sorts of legal problems.
Social gaming, however, is a far more open market. New operators emerge all the time, building up loyal followings in countries where gambling is otherwise prohibited. China and the United States are two great examples here.
Finally, there are the cryptocurrencies themselves. Many social casinos sell tokens which can then be used to play the games. This model has proved successful, but there is one problem: if you manage to win more tokens, they can only be used to play further games on the platform.
By substituting traditional social gaming tokens for cryptocurrencies, which are openly traded on exchanges, players are able to do a lot more with their social gaming winnings.
A screenshot of a game from Edgeless’ new Hotheads.io social gaming platform
Most gambling altcoins will make a social play sooner rather than later.
Edgeless, CashBet and KamaGames will not be the only blockchain projects to make major plays aimed at the social gaming space.
The sector is growing too fast to ignore. It opens up entirely new markets and demographics for gambling coins to target.
The question is whether these coins can have an impact in a sector dominated by large and experienced game studios like Zynga, a NASDAQ listed giant valued at $3.5 billion.
Most will have confidence that transparency advantages conferred by the blockchain, and the ability to easily trade tokens on open exchanges, will help grab market share.
Regardless, expect to see social gaming play an important role in the growth of Edgeless, CashBet Coin and others.