Ubisoft says Quartz is an early test of the NFT gaming market

Ubisoft’s Nicolas Pouard explains the publisher’s approach to blockchain gaming.

A screenshot of Ubisoft’s Quartz plan.

Ubisoft’s Quartz is offering free NFTs to players of Ghost Recon Breakpoint starting Thursday.

Image: Ubisoft

Ubisoft made a big splash in the world of blockchain gaming this week with the announcement of its Quartz platform for in-game non-fungible tokens. It was, perhaps predictably, met with a fair amount of fan backlash over the publisher’s perceived financial motivations and the general divisiveness of NFTs in both the gaming industry and the broader worlds of digital art and entertainment.

The YouTube announcement, though it was delisted to start and embedded on Ubisoft’s Quartz announcement website, racked up tens of thousands of dislikes. The YouTube platform now hides dislikes, but browser extensions can for the time being reveal them, and the announcement produced an overwhelmingly negative response on Tuesday. (Ubisoft confirmed to Protocol that the video was never listed and then delisted in response to criticism, as some reports claimed.)

But Nicolas Pouard, the vice president of the publisher’s Strategic Innovation Lab that conceived Quartz, wants players to have an open mind about NFTs and blockchain gaming. He clarified that players won’t have to spend any money – they only have to have played the game a certain amount of time – to collect the first three cosmetic NFTs debuting Thursday in the shooter Ghost Recon Breakpoint. Ubisoft also doesn’t plan on taking a cut or even operating the marketplace that would facilitate buying and selling them later.

“Ninety percent of the people now saying you can do the same with older technology, they haven’t tried [blockchain gaming],” Pouard told Protocol in an interview, when addressing skeptics who have pointed out how aftermarkets for unique in-game items have existed in the past without blockchain technology. He said such markets were often rife with scams and abuse, and there is little oversight or protections because players trying to turn a profit are repurposing in-game currency and items in ways they were never designed to be used.

“It's not enough to disregard what they’re saying. We have to respect what they’re saying. There’s real concern,” he said. Still, Pouard thinks many of the critics aren’t paying enough attention to the players who are already engaging with NFTs and the communities they are forming around them. “For people who don’t believe in it, just start by trying it,” he added.

The promise of NFTs, which can denote a piece of data like an image file or in-game item as a one-of-a-kind collectible, is creating a major boom in the game industry. Rare virtual items and collectibles have for years accrued significant cultural and real-world value among players of massively multiplayer online games and other similar titles. As a result, gray and black markets for item trading and currency farming, often unsanctioned by the game’s creator, have sprouted up around popular games like Blizzard’s Warcraft and Diablo series and Valve’s Counter-Strike and Team Fortress games.

But the blockchain, thanks to its decentralized nature and public ledger, may create all-new legitimate markets for buying, selling and trading such items free of control from any one developer or corporation. Proponents of blockchain gaming also imagine, for example, interoperable inventories where your items in one game can be brought to another or used in a unique experience outside the game they originated in. The idea is that the players themselves would be able to own these items for good and ultimately profit off them, instead of just leasing the digital rights to them in a controlled environment they have no financial stake in.

That’s the ideal, at least, and an enormous new market of blockchain gaming startups pioneering new business models like play-to-earn have sprouted up over the past few years to try and fuse cryptocurrency, NFTs and related technologies with video games. According to investment firm Drake Star Partners, blockchain gaming startups attracted nearly $2 billion private financing in the first nine months of 2021, with fast-growing companies like NFT marketplace OpenSea, Top Shots creator Dapper Labs and Axie Infinity developer Sky Mavis all earning multi-billion-dollar valuations of late.

Yet skeptics are concerned the biggest players in the game industry, with its history of adopting predatory monetization and nickel-and-diming consumers with microtransactions, may misuse the blockchain to their own benefit. Notably, Steam owner Valve banned games featuring NFTs and cryptocurrency from its digital store in October, though it has given very little clarity as to why.

“Not only is this ethically dubious but there's no practical reason to implement NFTs into your game. Certainly not for buying/trading ‘unique’ loot,” wrote Harper Jay MacIntyre, community manager at Microsoft studio and Psychonauts creator Double Fine, in a now-viral tweet about Ubisoft’s Quartz. “It's a scam. The more people in our industry who are willing to say so publicly, consequences be damned, the better.”

MacIntyre’s comments echo that of their boss, Xbox chief Phil Spencer, who has emerged as one of the very few high-level game industry executives to cast doubt on the promise of blockchain gaming. “What I’d say today on NFT, all up, is I think there’s a lot of speculation and experimentation that’s happening, and that some of the creative that I see today feels more exploitive than about entertainment,” Spencer told Axios last month. “I think anything that we looked at in our storefront that we said is exploitive would be something that we would, you know, take action on. We don’t want that kind of content.”

Pouard said Ubisoft isn’t just diving in now because there’s money to be made, and that its decision to launch Quartz was to finally have a formal product launch after many years of experimentation in the space. Ubisoft’s Strategic Innovation Lab has in fact been dabbling in the blockchain gaming space since 2017, with partnerships with crypto companies, investments in blockchain gaming startups and even prototype products.

“For us, as we started four years ago, it was less trendy,” Pouard said. “We did a lot of hackathons and partnerships, and worked with a lot of startups. We’re also exploring a lot of the infrastructure to understand the opportunities and limits of the blockchain today.” Pouard said Ubisoft helped form the Blockchain Gaming Alliance in 2018 as a founding member, and the organization has since grown to more than 300 companies.

Pouard said that for Quartz and its first product line, the Digits in-game cosmetics in Ghost Recon, is more of an experiment than anything else. “For us, Quartz is really a test. We really want to understand what decentralization can bring to players,” he said. “We want to build this value proposition with the community so we needed to start with something easy to understand and easy to build technically.” That’s why Ghost Recon, with its built-in set of cosmetics, was chosen as the debut game for Quartz.

“We think it’s the best moment to start,” Pouard said. “We know we’re a bit ahead of the curve here.” Pouard pointed to Minecraft and the game’s immense influence on game-making platforms like Roblox as one reason why Ubisoft wants to get in early. “We’re pretty sure that with the blockchain, the same thing could happen,” he said. “We don’t want to turn our heads away from it.”

The team at the Strategic Innovation Lab followed Ubisoft’s new set of blockchain principles, Pouard said, that include building products that can be used in-game, using energy efficient blockchain partners (Quartz is built on Tezos, which uses a so-called proof-of-stake system that supposedly wastes less electricity), and creating a safe environment for players to learn about the blockchain and NFTs. To that last point, Pouard said players must be 18 years or older to create a Tezos wallet for use with Quartz and that it doesn’t intend to take a cut of any transactions right now.

Pouard acknowledges that Ubisoft doesn’t need the blockchain to create a unique item like those featured in Digits, but the goal, he said, is to get players invested in the space and for Ubisoft to start exploring what can be built alongside its player community. That’s why he said there’s no real business model attached right now. Ubisoft is also open to other companies building integrations with Quartz and using the NFTs in new ways, as well as allowing existing or new marketplaces to facilitate the buying and selling of them.

“First, we’re a game developer and publisher, so it’s not that obvious that it’s a good way for us to go. We want to co-build and create the value proposition,” he said. “We’re seeing how it goes and how the players use it and what we can do with that. We are very early in this paradigm shift, so knowing what will be the business model of the future … it's too soon to say.”


What the economic downturn means for pay packages

The war for talent rages on, but dynamics are shifting back to the employers.

Compensation packages could start to look different as companies reshuffle the balance of cash and equity.

Illustration: Nuthawut Somsuk/Getty Images

The market is turning. Tech stocks are slumping — which is bad news for employees — and even industry powerhouses are slowing hiring and laying people off. Tech talent is still in high demand, but compensation packages could start to look different as companies recruit.

“It’s a little bit like whiplash,” compensation consultant Ashish Raina said of the downturn. Raina, who mainly works with startups that have 200 to 800 employees, previously worked as the director of Talent at Index Ventures and head of Compensation and Talent Analytics at Box. “I do think there’s going to be an interesting reckoning in terms of pay increases going forward, how that pay is delivered.”

Keep Reading Show less
Allison Levitsky
Allison Levitsky is a reporter at Protocol covering workplace issues in tech. She previously covered big tech companies and the tech workforce for the Silicon Valley Business Journal. Allison grew up in the Bay Area and graduated from UC Berkeley.
Sponsored Content

Why the digital transformation of industries is creating a more sustainable future

Qualcomm’s chief sustainability officer Angela Baker on how companies can view going “digital” as a way not only toward growth, as laid out in a recent report, but also toward establishing and meeting environmental, social and governance goals.

Three letters dominate business practice at present: ESG, or environmental, social and governance goals. The number of mentions of the environment in financial earnings has doubled in the last five years, according to GlobalData: 600,000 companies mentioned the term in their annual or quarterly results last year.

But meeting those ESG goals can be a challenge — one that businesses can’t and shouldn’t take lightly. Ahead of an exclusive fireside chat at Davos, Angela Baker, chief sustainability officer at Qualcomm, sat down with Protocol to speak about how best to achieve those targets and how Qualcomm thinks about its own sustainability strategy, net zero commitment, other ESG targets and more.

Keep Reading Show less
Chris Stokel-Walker

Chris Stokel-Walker is a freelance technology and culture journalist and author of "YouTubers: How YouTube Shook Up TV and Created a New Generation of Stars." His work has been published in The New York Times, The Guardian and Wired.


How 'Zuck Bucks' saved the 2020 election — and fueled the Big Lie

The true story of how Mark Zuckerberg and Priscilla Chan’s $419 million donation became the 2020 election’s most enduring conspiracy theory.

Mark Zuckerberg is smack in the center of one of the 2020 election’s multitudinous conspiracies.

Illustration: Mike McQuade; Photos: Getty Images

If Mark Zuckerberg could have imagined the worst possible outcome of his decision to insert himself into the 2020 election, it might have looked something like the scene that unfolded inside Mar-a-Lago on a steamy evening in early April.

There in a gilded ballroom-turned-theater, MAGA world icons including Kellyanne Conway, Corey Lewandowski, Hope Hicks and former president Donald Trump himself were gathered for the premiere of “Rigged: The Zuckerberg Funded Plot to Defeat Donald Trump.”

Keep Reading Show less
Issie Lapowsky

Issie Lapowsky ( @issielapowsky) is Protocol's chief correspondent, covering the intersection of technology, politics, and national affairs. She also oversees Protocol's fellowship program. Previously, she was a senior writer at Wired, where she covered the 2016 election and the Facebook beat in its aftermath. Prior to that, Issie worked as a staff writer for Inc. magazine, writing about small business and entrepreneurship. She has also worked as an on-air contributor for CBS News and taught a graduate-level course at New York University's Center for Publishing on how tech giants have affected publishing.


From frenzy to fear: Trading apps grapple with anxious investors

After riding the stock-trading wave last year, trading apps like Robinhood have disenchanted customers and jittery investors.

Retail stock trading is still an attractive business, as shown by the news that crypto exchange FTX is dipping its toes in the market by letting some U.S. customers trade stocks.

Photo: Lam Yik/Bloomberg via Getty Images

For a brief moment, last year’s GameStop craze made buying and selling stocks cool, even exciting, for a new generation of young investors. Now, that frenzy has turned to fear.

Robinhood CEO Vlad Tenev pointed to “a challenging macro environment” marked by rising prices and interest rates and a slumping market in a call with analysts explaining his company’s lackluster results. The downturn, he said, was something “most of our customers have never experienced in their lifetimes.”

Keep Reading Show less
Benjamin Pimentel

Benjamin Pimentel ( @benpimentel) covers crypto and fintech from San Francisco. He has reported on many of the biggest tech stories over the past 20 years for the San Francisco Chronicle, Dow Jones MarketWatch and Business Insider, from the dot-com crash, the rise of cloud computing, social networking and AI to the impact of the Great Recession and the COVID crisis on Silicon Valley and beyond. He can be reached at bpimentel@protocol.com or via Google Voice at (925) 307-9342.


Broadcom is reportedly in talks to acquire VMware

It hasn't been long since it left the ownership of Dell Technologies.

Photo: Yichuan Cao/NurPhoto via Getty Images

Broadcom is said to be in discussions with VMware to buy the cloud computing company for as much as $50 billion.

Keep Reading Show less
Jamie Condliffe

Jamie Condliffe ( @jme_c) is the executive editor at Protocol, based in London. Prior to joining Protocol in 2019, he worked on the business desk at The New York Times, where he edited the DealBook newsletter and wrote Bits, the weekly tech newsletter. He has previously worked at MIT Technology Review, Gizmodo, and New Scientist, and has held lectureships at the University of Oxford and Imperial College London. He also holds a doctorate in engineering from the University of Oxford.

Latest Stories