Final Fantasy publisher Square Enix has again used its New Year letter to promote its “aggressive” investment in blockchain games, arguing that recent market volatility could ultimately benefit its plans.
Square Enix was one of the first major publishers to announce support for “blockchain entertainment,” which effectively uses a digital ledger to allow users to own, buy, and sell digital items.
Last year, in their New Year’s letter, the company committed to developing blockchain and NFT games. Later in 2022, it announced plans to sell NFTs as part of what it called “the first digital collectible art project built from the ground up for Web3 fans.”
In a new letter discussing his plans for 2023, Square Enix president Yosuke Matsuda said that despite what he called “volatility” in the blockchain space in 2022, blockchain remains the biggest focus for his mid-term investments.
Matsuda argued that lessons learned and future regulation could benefit the growth of the blockchain space and plans to develop games based on the technology.
“In terms of new business areas, we have named three main investment areas based on our medium-term business plan,” said the executive. “Among these, we are most focused on blockchain entertainment, where we have invested aggressive investment and business development efforts.
“From an outsider perspective, it would be fair to say that in 2022, blockchain will gain significant recognition as a field, as evidenced by the fact that ‘Web 3.0’ has become a well-established buzzword among business people.
“However, the year also saw volatility in the cryptocurrency and NFT (non-functional token) markets following the dramatic changes in the macro economy described above. The second half of the year, in particular, generated a flurry of blockchain-related news, including the scandalous bankruptcy filing of FTX in November.
He continued: “Following these events, we are hearing from some countries that the first steps have been taken to regulate such businesses more strictly. In Japan, the promotion of such enterprises led by the government has gained momentum.
Matsuda further refers to Japan’s “Priority Policy Program for the Realization of Digital Society,” which was signed in June 2022 to promote the concept of Web 3.0, including the use of NFTs based on blockchain technology.
“New technologies and frameworks drive innovation, but they also create considerable confusion,” he wrote. “By riding such societal waves, some such technologies and frameworks gradually become a part of people’s lives, resulting in new businesses and growth.
“After the excitement and excitement surrounding NFTs and the metaverse in 2021, 2022 has been a year of great volatility in the blockchain-related space. However, if this proves to be a step in a process that leads to the creation of regulations and a more transparent business environment, it will certainly benefit the development of blockchain entertainment.
Matsuda concluded by acknowledging that much of the discussion around blockchain gaming has previously been driven by investors and focused on the monetization opportunities the technology could unlock.
He argued that increased discussion among the general public and lessons learned from the recent market turbulence could now steer blockchain games in a more attractive direction for consumers.
“Recently, numerous blockchain gaming events held abroad have led to more active discussions than ever before about what makes games exciting and what their user community looks like,” he said.
“The market until 2021 was driven more by speculative investors than by players. In other words, foreground content is created on the premise that blockchain and NFTs will result in monetization.
“However, following the aforementioned turbulence in the cryptocurrency industry, there is now a tendency to view blockchain technology as merely a means to an end and discuss what needs to happen to achieve the end of delivering new experiences and excitement to customers. . I see this as a very useful development for the future development of the industry.”
Square Enix has numerous blockchain games based on original IPs in development, some of which have already been announced and others are slated for release this year.
“Blockchain has been the subject of excitement and confusion, but in the rearview mirror, we hope that blockchain gaming will enter a new phase of growth in 2023,” Matsuda writes.