Exclusive: FTX buys Good Luck Games in quest to convince gamers to love NFTs and blockchain
The crypto company hopes to use the acquired firm's Storybook Brawl title as a showcase for what blockchain tech can do in the gaming space, and its staff as an in-house advisor on how to introduce the often-controversial tech to gamers in a non-predatory way.
FTX is acquiring Good Luck Games, makers of the card-based auto-battler Storybook Brawl. This purchase marks both the company's first foray into in-house game development, and a milestone in its ongoing effort to make blockchain-based digital objects an accepted business model in the gaming category.
Gamers have not been receptive to early attempts to introduce blockchain-based technologies such as NFTs and cryptocurrency into their games. Initial endeavors have resulted in everything from customer boycotts, to internal protests from development staff, to customer outcry so vitriolic it resulted in immediate cancelations of once-lauded plans.
Through it all, companies have continued to seek an inflection point that will let them introduce NFTs and crypto assets in a way that gamers won't reject. To understand how FTX hopes to leverage its new acquisition to help find that sought-after eureka moment, I sat down with FTX's Gaming Lead Amy Wu, its Head of Gaming Partnerships Steve Sadin, Good Luck Games Co-Founder and Design Lead Matthew Place, and FTX's CEO Sam Bankman-Fried.
Through all of these conversations, one thing was clear: FTX's leadership hopes Good Luck Games and Storybook Brawl will serve as not only a display case for what it can offer to customers, but also as a pool of in-house advisors tasked with helping FTX Gaming, as Steve Sadin put it, "care about the right stuff."
In a way, the union of the two companies has been brewing for many years. Not only have Matthew Place and Sam Bankman-Fried known each other since childhood, but both Place and Sadin are veterans of the collectible card and trading card game (TCG) arena. Place worked at Hasbro, which owns Magic: The Gathering creators Wizards of the Coast, while Sadin told me that he's known members of the Good Luck Games team for as long as 20 years, thanks to shared histories in the competitive Magic: The Gathering scene.
Putting all of this history together and taking into account what FTX is trying to accomplish, it's easy to understand how the leadership involved might see Good Luck Games as a possible golden ticket to widespread acceptance.
Card collecting meets digital tokenization
This acceptance largely depends on Storybook Brawl, Good Luck's first title. It is a PC exclusive that currently sits at a Steam review rating of "Very Positive," with 88% of its more than 2,200 reviews being favorable. The game is based on drafting, collecting, and battling with digital cards, combing traditional tabletop card games with the auto-battler genre largely popularized by titles like Auto Chess or Riot's League of Legends spinoff Teamfight Tactics.
Much like the various digital versions of physical card games Magic: The Gathering and Yu-Gi-Oh!, or Blizzard's digital-only card game Hearthstone, Storybook Brawl offers "hundreds" of cards players can collect. Every single one of those cards represents a potential vector for FTX Gaming to showcase how blockchain-based collectibles can be created for its future customers.
The details of exactly how those cards will be enjoined to blockchain technology remains somewhat up in the air. Across my interviews I heard mention of unique tokens that will enhance gameplay, and the possibility of being the "only one on the planet that owns this version of this card." But, these ideas were always referred to as prototypes, and no one was willing to commit to either a format or timeframe for when the public might see the first fruits of this new union.
The only concrete plans revealed were for a more traditional, art-based NFT drop the duo will hold during this year's Game Developers Conference (GDC), where it also plans to make the acquisition public knowledge.
Good Luck Games as a Sherpa
Going forward, it seems less important to the leadership at both companies exactly what form their blockchain-based offerings will take, and more important that those forms uphold the ethical ideals they believe will convince gamers that NFTs and crypto content can be something more than a scam or money grab. Good Luck Games' co-founder Place told me his company was entirely focused on using FTX's funding and technologies to make its game "A+," with plans to "figure out the monetization" somewhere downstream.
Sadin may have summed this apparent prioritization up best, saying "When there are great games that really resonate with people, and there are business models that they feel really good about, where they understand the value of the assets…that's when we're gonna win over. You know, that's when people are really gonna embrace this."
Along those same lines, Matthew Place hopes Good Luck Games can be "kind of the shining knight in this space." Sadin, meanwhile, hopes that knight is ready for some constructive battle. He believes the Good Luck Games team will provide FTX "feedback that's strong on technology, that's strong on consumer experience, that can just like beat us up."
This all feeds into what FTX's chief exec Sam Bankman-Fried called "the highest calling that you can have," to create a game that simultaneously integrates blockchain tech and makes gamers say "Oh wow. That was really well done. That's a great game right there." Fried is well aware of just how important a turning point a single excellent game can be for a given business model.
The historical trajectory of free-to-play games came up again in our chat when we discussed the relative bump in quality of what he called the "second generation of free-to-play games." Fried seemed to agree with my use of this business model's rise as a historical example of what blockchain-based games are now trying to accomplish. As mentioned in previous coverage, free-to-play games went from once being seen as scams and money grabs to powering some of the most popular titles on the planet today, including League of Legends, Fortnite, Call of Duty Warzone, and many more.
Both companies clearly hope their respective expertise and motivations will result in an interplay that produces a similarly bright future not just for them, but also for the customers they hope to serve, and for blockchain technology as a whole. If they can accomplish this goal, and that's a very big if, the obvious follow-up question is, how long will it take?
I asked FTX's chief for his educated guess at a timeframe for when blockchain tech will become a mainstream part of the industry. He replied that he didn't expect it to happen within the next three months, but he would be surprised if it didn't happen within five years. He also noted how easily "one small thing" could move the needle "by 30% in either direction."
Obviously, FTX and Good Luck Games hope their union will serve as, at least, a "one small thing" moment, pushing the needle toward widespread acceptance of blockchain use in gaming.
Ultimately, industry attempts to convince gamers of blockchain's value remain in their infancy, and FTX Gaming has only existed for a fraction of those attempts.
The company's acquisition of Good Luck Games seems, at least on paper, to be a move in the right direction. The involved leadership clearly hopes it can take what user reviews suggest is a well-received game and use the combination of its card collecting mechanics to introduce NFTs and digital object ownership in a non-predatory, and in a way that adds value to the gameplay experience.
A long road remains ahead for FTX Gaming. Now, it has a companion on that journey that at least appears to have the intentions of its audience at heart. However, many technical and logistical obstacles will need to be overcome in order to achieve any sort of joint progress.
Both FTX and Good Luck Games must also overcome the damage that's been done to the credibility of blockchain tech in the gaming space by companies attempting to exploit gamers with low-quality cash grabs. Any progress toward turning monetization through digital object ownership into a viable business model absolutely requires that FTX and Good Luck Games prove they are, without question, different.
Steve Sadin knows this. He said himself that he realizes "trust needs to be earned and re-earned" when attempting to convince "smart and very critical" gamers that NFTs and their ilk can actually be a good thing.
It remains to be seen what lies at the end of this road, but FTX clearly thinks bringing the Storybook Brawl and the Good Luck Games team on board is a huge first step down a righteous path.