Gaming giant Square Enix has revealed in its Q1 earnings report that it will expand nonfungible tokens (NFTs) into more game products as part of its medium-term business strategy in 2022.
Square Enix (SE) is a Japanese game developer with $3 billion in assets under management, according to its latest earnings report. The firm owns the Final Fantasy property and sold the Tomb Raider franchise for $300 million on May 3.
The report states that the firm piloted NFTs on the Shi-San-Sei Million Arthur game starting in February this year. The success of the pilot program will lead to the second season of the game’s NFTs and will ultimately see the firm pursue broader activities in the NFT and blockchain industries.
Among the top priorities of its blockchain domain initiatives, SE plans on establishing regulatory clarity and guidelines for blockchain games, tackling scalability in NFT economies and considering founding a corporate capital venture unit.
The firm also stated that it plans on establishing an overseas entity that will handle “issuing, managing, and investing our own tokens,” suggesting the firm will begin creating an expansive gaming-token economy.
SE has been working with Web3 gaming and metaverse venture capital firm Animoca Brands to explore its options in the blockchain gaming space. Cooperation between the two firms is expected to grow as SE delves further into the ecosystem.
Animoca’s executive chairman Yat Siu believes Square Enix’s influence in gaming will only help the firm form a foothold in blockchain gaming. He told Cointelegraph on Monday:
“Square Enix has already been talking about the potential of blockchain games for a long time, so it gets it better than most of the traditional gaming giants out there.”
The report puts investments in and monetization of blockchain, artificial intelligence (AI) and cloud computing as its third objective in its medium-term business strategy. This is in line with CEO Yosuke Matsuda’s expressed intention for his company to become more involved in those technologies in January.
The popularity of Web3 and NFT gaming has remained robust throughout 2022 despite a general crypto market downturn. Market tracker DappRader shows that there were 1 million daily active gamers on Saturday, nearly the same level as on January 1.
However, gamers are not buying as much as they used to, as total sales volume for NFT game items has dropped 88% from $70 on January 1 to $8.7 million on Saturday.