Ownership in Web3 Gaming is Bullshit

Vader Research
4 min readMay 11, 2023


You Don’t “Own” Game NFTs

Blockchain supposedly allows for permanent ownership of in-game assets. While in-game assets live on a centralized database of a web2 game, web3 game assets permanently live on the blockchain which is a decentralized ledger. It is time to have an honest argument about the advantages and limitations of web3.

Argument 1: If the game developer ever shuts down or gets hacked, you will still own your NFT assets

  • An NFT is just a receipt/title that validates your ownership of the game asset. The visuals of the game asset are not stored on the blockchain, they are stored within the game’s centralized database. If the game shuts down, you end up with the title, not the visuals.
  • Other game developers can’t just enable you to play with those items. They need to obtain the necessary IP copyrights for it. Games can’t casually put Darth Vader on their levels, otherwise, they’ll get sued by Disney. Web3 game developers would also need permission from the original game developer to be able to use those in-game assets in their games.
  • In case the web3 game developer gets permission from the original game developer, there are no guarantees that the utility of that asset would be the same in the new game. Even the visuals might be different to match the art style of the new game.
  • However since everyone knows that you are the owner of a specific in-game item, you might be granted special rewards or custom-tailored gameplay experiences by other web3 games. This is related to data interoperability rather than ownership and is a significant benefit of web3 gaming.

Argument 2: The game developer can’t ban or nerf your NFT assets

  • The web3 game developer (or a DAO governance consisting of token/NFT holders) can nerf and weaken your NFT game asset anytime. This will likely make the NFT less valuable and result in a price drop. Nerfing/buffing assets to maintain the game balance is necessary to have a fun game. Even the metadata of some NFTs can be changed by the issuer.
  • The web3 game developer can mint the copies of the NFT you own or mint new collections and dilute the value of your NFT asset. You will still own the asset but its price will drop tremendously.
  • The game developer can prevent your NFT from accessing the game — which is basically the same as the asset getting banned.

Argument 3: You can trade the NFT asset at multiple marketplaces

  • This argument made sense — instead of being locked to the game’s internal marketplace (CS GO — Steam), you could trade on alternative marketplaces, potentially get better pricing and pay lower marketplace fees.
  • However, things have changed with the NFT marketplace war between Blur and Opensea. Web3 game developers will rightly be using custom NFT smart contracts that prevent players from trading on marketplaces that enable traders to skip creator royalties.

Final Words

Web3 gaming has certain benefits but also has limitations. Exaggerating the capabilities of the technology will likely increase the polarization between NFT haters and NFT maxis. Acknowledging limitations and weaknesses will help us attract more developers and players from web2 gaming.

This piece was inspired by the replies to this tweet. Thank you to @huzzonen, @gaspodewd, @jefftunn, @fiskantes, @xdereklau, @sparkcsays, , @passytee, @TimoYouth, @EL_DEE420 and all others that shared their opinions.

What do you think? Do you agree or disagree? Feel free to comment below!



Vader Research

Web3 Game Economy & Token Design Consultancy dedicated to the long-term development of Blockchain Gaming. https://vaderresearch.com/