Game theory in the gaming industry: The disruption of non-fungible tokens (NFTs) and blockchain technology.

The gaming industry has been experiencing exponential growth throughout the recent years and is still continuing on this trajectory. Recent trends in the industry include streaming, virtual reality, and augmented reality. Besides traditional gaming companies that have been leading the industry for many years such as Activision Blizzard, Tencent, and Microsoft, blockchain-based game developers have surfaced the market throughout 2020/2021 and are beginning to show signs of disruption in the industry. Several areas that NFT games differentiate themselves from traditional games include the ability to earn monetary rewards by playing the game, true ownership of in-game assets, and an overall decentralized gaming model. This opens up many opportunities in the industry for both developers and gamers alike. However, traditional games still hold the majority of the market share today. Traditional games offer better quality gameplay and graphics, can be played across multiple consoles, while enjoying a high degree of centralization. Moving forward, the strategic decision that game developers need to consider is whether to embrace the NFT gaming model, maintain status quo, or to have some form of optimized hybrid model. This paper discusses the state of the industry as presently constructed and also how it has evolved throughout the decades. In addition, this paper critically examines the traditional gaming model and the NFT gaming model to understand the pros and cons of each model. Finally, the paper proposes a conceptual game theory framework to determine what gaming model should developers opt for in the coming years. [ABSTRACT FROM AUTHOR]