Gaming company behind Sonic The Hedgehog and Yakuza, Sega, has announced its departure from the blockchain gaming space due to the ongoing crypto winter.
Co-COO Shuji Utsumi revealed that Sega is yet to determine the practical applications of blockchain and is considering excluding it from a flagship “supergame” scheduled for release in 2026.
Speaking at a gaming conference, Utsumi explained that Sega intends to protect the value of its content by refraining from integrating its biggest franchise into third-party blockchain gaming projects.
This decision effectively marks the end of Sega’s foray into blockchain game development.
Last year, Sega partnered with Japanese blockchain firm, Double Jump Tokyo to create a new game based on the Sangokushi Taisen series.
However, the company’s understanding of blockchain’s full potential for game development remained unclear.
Sega producer, Masayoshi Kikuchi had previously expressed the belief that non-fungible tokens would play a role in the future gaming landscape.
Since the collaboration announcement, the blockchain industry has faced numerous criticisms and setbacks.
The FTX debacle in late 2022 pushed several crypto startups into debt, followed by a diversion of attention toward artificial intelligence with the introduction of chatbots in early 2023.
The industry has struggled to regain its momentum, experiencing ups and downs.
Sega’s partnership with Double Jump Tokyo also drew substantial criticism last year.
Rival company, Konami faced similar backlash when it announced plans to auction Castlevania NFTs on the OpenSea marketplace for the game’s 35th anniversary.
Critics, including gamers, have accused game developers like Sega of adopting blockchain and NFTs solely for profit and cash-grab purposes.
This widespread sentiment may have contributed to Sega’s decision to abandon blockchain game development.
Utsumi emphasized that the lack of entertainment value in play-to-earn games was a key factor, stating, “What’s the point if games are no fun?”
While Sega acknowledges the potential of blockchain, Utsumi highlighted the company’s ongoing evaluation and search for the best way to entertain its audience.
Sega’s withdrawal from blockchain gaming is likely to be well-received by traditional gamers who have voiced concerns about the full transition to play-to-earn games.
However, it remains to be seen how this decision may impact Sega as the blockchain industry continues to evolve, potentially rewarding its supporters and surprising its skeptics.
