This article was first published on Silicon Republiccryptocurrency – Silicon Republic
Last year Dublin-headquartered online gaming platform KamaGames initiated a token sale using the Ethereum blockchain.
And, instead of raising €22m as had been initially targeted and reported by The Irish Times, it came away with some telling conclusions; most critically that blockchain-based transactions are too slow for online gaming and that centralised databases remain the way forward.
‘I estimate that 95pc of tokens are already dead’
– ANDREY KUZNETSOV
KamaGames is one of the biggest European social mobile games operators and is worth an estimated $500m. Last year the company reported a 33pc increase in revenues to $76.4m. The award-winning operator’s flagship title, Pokerist, has been the number one grossing app in 101 countries on the iOS App Store and one of the top five grossing apps in 45 countries on Google Play.
A token effort
KamaGames CEO Andrey Kuznetsov told Siliconrepublic.com that the intention of the token sales actually wasn’t to raise money but to create a new and different form of promotional event to attract a new type of audience or engage with lapsed players.
The company launched KamaGames Tokens as in-game virtual chips that could grow in value. However, the chip sale attracted few new users, and generated little additional revenue and little improvement in player retention.
Kuznetsov explained that the issue was that the speed of transactions and performance was too slow.
KamaGames processes 1.5m transactions per minute. “Centralised databases are much faster for us. Secondly, the cost of transactions would have increased expenses and hence we would have had to charge players more. We are in the social games business where a tiny percentage of players are paying, so it wouldn’t have justified the investment.
“In the end there was no actual benefit either for us or the players. We ...
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