A Glimpse inside Video Game Money, Virtual Reality, Cryptocurrency and the Future

Cryptocurrency and blockchain technology is already rapidly reshaping highly established industries around the globe – but how is this fascinating technology being used in other emerging industries?

One great example of this is the use of cryptocurrencies in multiplayer video games or platforms, specifically in virtual reality platforms. Before we get on to that big idea, lets briefly touch on one very unique virtual currency that has already existed in a virtual universe for over a decade.

Runescape GP Currency in a stack with other items in a players inventory

Virtual Currencies in Multiplayer Video Games

Contrary to popular belief, not all video games are purely based around a kill or be-killed gameplay dynamic.

Other roleplaying and adventure games feature legitimate and functioning economies, some where the value of their native virtual currencies are more stable than real-world currencies backed by real governments and banks. An excellent example of this is the Runescape GP.

Runescape old school logo

Runescape, an online adventure / roleplaying style computer game, boasting over 50,000 active users, has supported and maintained its very own independent player backed economy and virtual currency with moderate diligence throughout the past 17 years. At the time of writing, 1,000,000 Runescape GP is roughly equivalent to 0.5 USD.

The exchange rate of GP to USD has proven to see relative stability throughout the years, and the image below demonstrates this perfectly.

300 million Runescape GP vs the United States Dollar over the past 90 days

USD Runescape GP conversion rate over 90 days

Looks stable enough right? For reference, here’s the Venezuelan Bolivar vs the USD over the past 5 years:

Venezuelan Bolivar vs the US Dollar

USD to bolivar conversion rate over 5 years

Players in Runescape can earn GP in a multitude of ways, including killing bosses, creatures and players that drop rare items. Once a player has looted rare items dropped from killing enemies, they can bring it to the ‘Grand Exchange’ and sell the items to other players for GP.

Runescape old school grand exchange image
Equivalent to an online auction website like eBay, the grand exchange provides players with the ability to buy and sell things directly with suppliers or sole traders in the virtual Runescape world.

The Grand Exchange acts as the heart of the Runescape economy, being the central location where users can list and set selling prices for items that they have collected, so that other players can buy them at auction, in exchange for Runescape GP.

Users can then create new items with the items that they have purchased at the Grand Exchange, or in the case of the sellers, they can use the money they receive from selling their own items to purchase more items from the Grand Exchange that they cannot acquire due to restrictions of their niche player skillset.

Runescape Grand exchange selling a feather for GP
Runescape requires users to reach certain skill levels to acquire niche items, unless they purchase them from the Grand Exchange. Players can skill up in many different skills including mining, crafting, hunting, fletching, fishing ect.

Due to these skillset restrictions and the time that it can take to get items, lazy players have been looking for a way that they can source GP in large quantities in the easiest way possible. The result of this high demand created a supply, and to the creators of Runescape’s surprise, a brand new real-world economy was created.

Sell your runescape GP for USD website

throughout its history, Runescape has had a huge problem with users accumulating Runescape GP to then sell on real-world black market websites in exchange for real government-issued cash, like the AUD, USD or NZD.

Spending two hours killing the Green Dragon creature in Runescape will gather you around 1,000,000 GP worth of rare item drops. If you then bring your GP to a black market website exchanging GP for USD, you can convert your 1 million GP for approximately $0.50c USD – or twice the amount that a worker in Venezuela makes for a full day of real-world work….

slaying green dragons in runescape wilderness

The result of the Runescape economy and it’s stable US Dollar to Runescape GP exchange rate has led to hundreds if not thousands of families in countries like Venezuela making their living off video game virtual currencies – with some even storing the bulk of their wealth in Runescape GP to escape the unpredictability of their own national currencies.

Killing Dragons and other creatures in Runescape to sell for GP and then USD has proven itself to be a highly lucrative business strategy for people in impoverished countries around the globe to make money – with some individuals even going as far to create entire companies based around killing creatures in Runescape to make a real-world living…

Runescape farmers sitting on their computers farming GP
A Chinese RuneScape GP factory in prime action.

Countries like Venezuela, Zimbabwe and Argentina have in recent times seen a huge devaluation of their national currencies, due to a plethora of different reasons that deserve their own article.

Regardless of the reasons behind this huge currency devaluation, the output is clear:

The massive amount of cash that Venezuelan citizens have to pay for meat
A kilogram of meat is pictured next to 9,500,000 Venezuelan bolivars, its price and the equivalent of 1.45 USD, at a mini-market in Caracas, Venezuela August 16, 2018. It was the going price at an informal market in the low-income neighbourhood of Catia.

So are video gamers more likely to accept cryptocurrency?

Interesting enough, people who have experience with virtual currencies like the Runescape GP may be more accepting of Bitcoin and other cryptocurrency, than someone who has never touched virtual currencies before.

One key reason behind this correlation may be due to the fact that until many young recreational video game players are of the age where they need to support themselves with currencies like the NZD – virtual video game currencies play the role as one of their primary currencies. (These currencies being instant and universal)

Trading items in runescape with another player

It’s unlikely that video game players are going to single-handedly drive global cryptocurrency adoption, but what is clear is that a good portion of gamers give virtual currencies real-world value, and that many gamers are open to the idea of exchanging virtual items for real-world currencies, and visa versa.

Venezuelan Runescape players kill virtual dragons for their loot so they can sell it on GP to USD exchanges to make real-world money, and lazy Runescape players use real-world fiat currency like the USD to buy GP on black market exchanges so they don’t have to acquire it by themselves.

Some of these black market GP to fiat exchanges accept Bitcoin already!

Bitcoin accepting runescape exchanges

People want to exchange government-issued money for virtual currencies so they can spend it in the virtual world, and others in the virtual world want to sell their virtual items so they can exchange it for government-issued money..

Let’s talk about what happens when these two ideas meet halfway..

I Introduce To You; Blockchain-Backed Virtual Reality Universes

boy with occulus rift vr headset on with out of focus background

You put on a strangely futuristic-looking helmet that covers your face, and suddenly your eyes catch focus. You look down at where your hands would be in the real world and see virtual hands moving in sync with your real-life hand movements.

You walk around in the virtual world thanks to the sensor in your living room picking up your real-world body’s movement – and you move your physical head around to see hundreds of other people minding their business inside the virtual world; your new virtual reality.

woman with plaid shirt experiencing virtual reality world

You see people interacting with each other and doing a whole range of bizarre activities, but you notice something else that you didn’t expect to see..

Across the road, you see some commotion outside a virtual Nike shoe shop, and you move in closer to get a better look. You are amazed to find yourself looking at a virtual person looking at a virtual pair of shoes, based off real shoes that can be bought and sold in the physical world.

inside a hyper realistic reality VR

You see this animated humanoid figure pick up shoes off a shelf, place them on his virtual feet and decide whether or not he thinks they suit him. He ends up deciding he wants them, and purchases his new Nikes on the spot.

Two days later he receives a knock on his door on his real-world house and magic; the shoes that he tried on in the virtual world have been delivered straight to his physical real-world address.

Woman trying on a dress in VR

Shopping in virtual reality goes far beyond buying shoes, as its theoretically possible to find and demo any item you want to own in real life in VR and have the physical copy sent to your real-world home address.

This all sounds pretty cool and efficient, right? But where does cryptocurrency come into this?

In these virtual reality universes, to streamline things, there needs to be an instant and accessible mutual currency that anybody can use, regardless of where they are in the physical world. Scarce items in the virtual world like virtual real estate need to be immutable to be truly valued, and one way of making this happen is to use a blockchain as the platform’s backbone.

Decentraland icon and logo with dark woods in the background

Decentraland and other Blockchain backed universes

Decentraland is an Ethereum-powered virtual reality platform. In this virtual world, you can purchase plots of land that you can later traverse, build upon, and monetize.

Decentraland is home to its own native cryptocurrency MANA, a decentralised highspeed currency that will be used as the primary medium of exchange to buy and sell things inside Decentraland.

two people shaking hands inside a virtual tron looking world VR

There’s no limit to what you can do, and Decentraland is the first digital platform where the in-game assets are wholly owned by its users. Real-world companies can set up shops and features in this world, where you can irreversibly buy digital or real-world items, and have the item shipped to your real-world address when your payment is completed.

You may ask yourself, is this really necessary, why don’t we just walk to shopping malls and or buy things online? Well, what’s better than a combination of both these things? ¯\_(ツ)_/¯

(and yes, you can buy MANA through Easy Crypto 😉)

Young woman in hospital bed using VR

Virtual reality isn’t just built for you though, it’s built for everyone. Anyone at all, from the comfortability of their couch, can easily enter the virtual world and meet with friends, shop for real-world items and explore the creations of other people.

Whether you are disabled, on a long flight, on a hospital bed or in labour, you can streamline living a fully mobile virtual lifestyle, just by putting a funny looking headset on your head. Decentraland isn’t the only platform building a blockchain-backed VR platform either, but more about that later.

Men inside VR doing a business meeting around a table

Beyond buying things in VR.

Shopping with cryptocurrency is just the beginning of possibilities of Virtual reality, as the use cases go far beyond. Imagine you need to have a video call with an important work client whos on the other side of the world? Well, do it in VR. You want to play video games or hang out with your mates? Do it in VR. You want to learn new skills or you study online from home? Do it in VR. Want to go see the super bowl live with your mates? Do it in VR. 

Cryptocurrency and the evolution of virtual reality technology are slowly tearing down the walls between the real world and the digital world, and as distopian as this may sound to you, the reality of the average consumer spending hours of their day in digital worlds appear to be only a matter of time away.

Walle fat vr users with walle rolling like a don through the middle of them

Virtual reality platforms like Decentraland have the potential to disrupt social media networks like Facebook, overtake video streaming platforms like Youtube, completely change the way we interact with each other and revolutionise the way we purchase things online and in the real world.

VR will be used in long flights to keep people entertained, in education so individuals can experience things outside of the classroom, like flashing back in time and seeing dinosaurs roaming the world – and to enable frictionless digital business meetings, whether or not your colleagues are in Antarctica, Spain or Japan.

As aforementioned, Decentraland isn’t the only platform working on an idea like this, and one platform much closer to home has been working on their own VR platform for the past 5 years..

Young man with Facebook VR headset on next to facebook logo

Facebook’s Virtual Reality platform and Libra digital currency power duo

Since March 2014, Facebook has been making and animating anatomically correct models of the human skeleton and overlaying muscle and skin to be used in their very own Virtual reality platform. Facebooks VR researches have been tracking how humans move in real-time, and replicating their movements to be used in the virtual world.

Facebook is also reconstructing and simulating the actual clothing a person is wearing, using physics-based software to figure out how clothing should move virtually when they do things such as dance or stretch.

Mark Zuccerburg Facebook founder with VR headset on and VR arm controllers with black and blue background

Facebooks Virtual reality efforts in combination with their Libra digital currency are expected to fulfil the very same idea that Decentraland is going for, except on a much larger scale. Whether or not Facebook takes the cake and creates the first mainstream virtual reality universe powered by its own digital currency and blockchain, or another company does instead – it appears to be inevitable that many of us are going to spend a good part of our free time in the virtual world in the future.

VR will create a whole new meaning to the phrase ‘ go outside and play’, and the implications of this on human behaviour and psychology are yet to be figured out. On a final note, ask yourself, what would you do in a virtual world where you can create anything that you can possibly imagine? Now ask yourself if you would want to experience that. Technological barriers aside, I think we have both answered the question on if it’s inevitable that VR platforms will catch on and go global.

Written by Harry, EC’s chief hype master