Square Enix released Yosuke Matsuda’s annual New Year’s Letter from the President for 2023. These missions give people an idea of what to expect from the company as well as the goals for the coming year. In addition to celebrating the 20th anniversary of Square and Enix’s merger, it also highlighted its goal of creating an end-to-end global publishing organization and how it spun off Crystal Dynamics, Eidos-Montreal and Square Enix Montréal. A continued commitment to a celebrated effort in 2022. That said, Square Enix will continue to invest in and explore NFTs and blockchain games in 2022 despite the ups and downs in the cryptocurrency space.
It should be recalled that Square Enix President Matsuda also brought up NFT and blockchain games in his 2022 New Year’s Letter. At the time, he suggested there would be story-driven NFTs.
Here’s part of the Square Enix New Year’s Letter where Matsuda discusses the company’s approach to NFTs and future blockchain games.
In terms of new business areas, we have named three main investment areas based on our medium-term business plan. Among these, we are focusing on blockchain entertainment, where we have invested the most aggressive investment and business development efforts. From the outside, it’s fair to say that in 2022 blockchain will gain significant recognition as a field, with “Web 3.0” becoming a firmly 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, produced a series of news stories related to blockchain, including the scandalous bankruptcy filing of FTX in November.
Following these events, we hear that some countries are taking the first steps to regulate such businesses more strictly. In Japan, government-led promotion of such enterprises has gained momentum. In June 2022, Japan’s Cabinet of Ministers signed a plan called “Priority Policy Program for Realization of Digital Society”, which includes statements on creating an environment to promote the concept of Web 3.0, including the use of NFTs based on blockchain technology. . Japan’s Digital Agency has also launched a Web 3.0 research group.
New technologies and frameworks lead to innovation, but they also create considerable confusion. By riding such social waves, some such technologies and frameworks gradually become a part of people’s lives, eventually leading to new businesses and growth. After the hype 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 growth of blockchain entertainment.
Continuously monitoring these changes in the environment while looking at what web 3.0 and blockchain entertainment really is from a higher level perspective provides a different picture than if we focus on them only from a technological or speculative investment perspective. As I said in last year’s New Year’s letter, if we consider traditional games to be centralized, then blockchain gaming must operate on a self-sustaining decentralized model. That concept, which I consider to be the main one, is philosophy.
That said, what kind of new experiences and new thrills our Digital Entertainment business can deliver to our customers through game development efforts and other efforts under a self-sustaining, decentralized concept is extremely important.
Recently, numerous blockchain gaming events held overseas have led to more active discussions than ever about what makes games exciting and what their user community looks like. The market until 2021 was driven more by speculative investors than by players. In other words, the front-end content is created on the basis that blockchain and NFTs will result in monetization. However, after 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 deliver new experiences and excitement to customers. I see this as a very beneficial development for the future development of the industry.
Our team has numerous blockchain games based on original IPs, some of which we announced last year, and we are preparing to launch even more titles this year. We are also engaged in global sourcing from an investment perspective and will continue to acquire stakes in promising businesses, whether located in Japan or overseas. Blockchain has been the subject of excitement and confusion, but with that in the rearview mirror, we hope that blockchain gaming will enter a new phase of development in 2023.
Square Enix has already begun dipping its toes into such endeavors. Announced Symbiogenesis in November 2022. The announcement teasing the project stated that it would be a “NFT collectible art project” and that participants would participate in the project. “Open the story.” It will start in the spring of 2023.