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Square Enix Keen On Shifting Focus To NFTs And The Metaverse

Square Enix Keen On Shifting Focus To NFTs And The Metaverse

The President of Final Fantasy Publisher, Square Enix, believes that NFTs, Blockchain games, token-based economies, and the Metaverse are here to stay. In the company’s new year letter penned to users, the president showed considerable support for these technologies and hinted that Square Enix could be investing in them in the new year. 

The Year Of The Metaverse 

The letter started with the Metaverse and how it had become one of the biggest topics of 2021, with immense potential in the opportunities it brings to the table. He pointed to Facebook changing its name to Meta and how this is evidence that the “Metaverse” isn’t just a buzzword but is here to stay. He also dubbed 2021 as the “Metaverse: Year One” and “NFTs: Year One,” highlighting the interest that both generated in 2021. We have already seen significant developments in this area, with Blue Monster Games acquiring Citadel Studios, bringing the former to the Metaverse. Another major development is PwC Hong Kong acquiring land in the Sandbox metaverse. 

Matsuda believes that the Metaverse will transition into a business phase sometime in 2022 and will see an influx of services that will make an appearance. This will be made possible thanks to technological advances in XR and the growing prevalence of 5G, Cloud technology, and blockchain technology. 

“As this abstract concept begins to take concrete shape in the form of product and service offerings, I am hoping that it will bring about changes that have a more substantial impact on our business as well.”

Views On NFTs 

Matsuda wrote that NFTs were greeted with significant enthusiasm in 2021 but also noted that there were instances where NFTs featured in “overheated trading” with some amount of speculation involved. However, he stated that he believes that this would correct itself over time. He wrote in the letter, elaborating on his point, stating, 

“This, obviously, is not an ideal situation, but I expect to see an eventual right-sizing in digital goods deals as they become more commonplace among the general public, with the value of each available content corrected to their true estimated worth, and I look for them to become as familiar as dealings in physical goods.”

New Areas Of Focus 

Matsuda stated that Square Enix had identified Artificial Intelligence, the Cloud, and blockchain games as new spheres where the company will be focusing its investments, with the company already beginning its R&D in these areas. With AI, Square Enix will focus on simulation technology, world models, and language processing. Matsuda explained the meaning behind these efforts, stating, 

“These efforts will help us develop the games that we release into the world and enhance their overall quality, but that is not all. By incorporating the output of these R&D efforts into virtual avatars and elsewhere, we plan to apply that output to a wide variety of content and provide the relevant technology to other companies, with a view to leveraging these R&D efforts across our entire Digital Entertainment business.”

Cloud Technology And Blockchain 

Regarding cloud technology, Square Enix will leverage Cloud technology to help in the distribution of content. It will also utilize it in developing content to offer consumers new forms of entertainment powered by the cloud and its attributes. He also talked about blockchain games, describing them to be different than the current traditional games, which he described as having a unidirectional flow where creators provide a game and consumers play them. 

About blockchain games, Matsuda wrote, 

“By contrast, blockchain games, which have emerged from their infancy and are at this very moment entering a growth phase, are built upon the premise of a token economy and therefore hold the potential to enable self-sustaining game growth. Advances in token economies will likely add further momentum to this trend of diversification. I see the “play to earn” concept that has people so excited as a prime example of this.”

Token Economies To Provide Greater Consistency Through Incentives 

Matsuda also stated that he believes that token economies will give users significant incentives, resulting in users being highly motivated to spend more time playing a game. Token economies will also create an upside to their efforts.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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