Sega abandons blockchain, NFT gaming projects

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Gaming company Sega has withdrawn from its blockchain projects due to concerns about the devaluation of its content, which is in contrast to their prior support for blockchain gaming and filing for a “Sega NFT” trademark in Japan back in 2021.

Shuji Utsumi, the co-chief operating officer of Sega, expressed his intentions to ensure zero blockchain involvement in the firm’s most prominent series like Yakuza or Sonic the Hedgehog.

“The action in play-to-earn games is boring,” Utsumi said in an interview with Bloomberg. “What’s the point if games are no fun?”

However, Sega reaffirmed its commitment to blockchain investment, albeit in smaller ways, by offering its less prominent franchises to third-party Web3 game developers. External partners can now use characters from the Three Kingdoms and Virtua Fighter series for NFTs.

The company’s initial announcement regarding its involvement with NFTs faced backlash from fans concerned about the negative environmental impact of cryptocurrency technology on gaming.

Previous plans

During a management meeting in December 2021, Sega CEO Haruki Satomi expressed the company’s interest in exploring various NFT experiments.

At that time, Satomi acknowledged the importance of mitigating any negative aspects of blockchain technology. He emphasized that if blockchain technology is considered solely a means for making money, he would prefer it not to develop further.

The recent development followed shortly after a collaboration with Double Jump Tokyo in 2022 to make a blockchain-based card game, which is reportedly still in progress. The game is based on the popular Sangokushi Taisen. It is set to be released on the Oasys platform, which uses the environmentally friendly proof-of-stake (PoS) method.

“With a unique architecture optimized for blockchain games, Oasys aims to solve obstacles for gamers, offering fast transactions and zero gas fees and providing users with a more comfortable gameplay experience,” said Hironobu Ueno, CEO and founder of Double Jump Tokyo.

Sega’s decision to distance itself from the industry marks a departure from their ambitious Web3 “Super Game” project last year. The “Super Game” initiative is a series of high-budget online multiplayer games scheduled to be released in 2026.

Developments in other companies

Valve’s gaming platform, Steam and its independent platform, Itch.io, have completely banned blockchain technology. Following criticism and low interest, Ubisoft has also pulled back its investments in NFT games.

In contrast, EA and Nike have joined forces to integrate .Swoosh NFTs in upcoming games. Square Enix also recently announced a collaboration with blockchain gaming platform Elixir to promote Web3 adoption among conventional gamers.

Yosuke Matsuda, the former president of Square Enix, earlier reaffirmed the company’s commitment to “aggressive investment” in blockchain technology and NFTs.

Sega still acknowledges the ongoing utility of blockchain technology, saying it remains open to future involvement as the technology develops. Utsumi highlighted its potential in enabling the transfer of characters and items across different games.

“We’re looking into whether this technology is really going to take off in this industry, after all,” Utsumi said.

“For the majority of people in the video game industry, what blockchain advocates say may sound a bit extreme, but that’s how the first penguin has always been. We should never underestimate them.”