Valve head Gabe Newell calls NFT “super sketchy”

Public reception for the launch of Ubisoft’s Quartz, an NFT platform for the Tom Clancy Ghost Recon, was bombed with horror last December. That never stopped the French publisher from doubling down on protesting people for their alleged ignorance of blockchain technology — we “do not understand,” they said. Square Enix chose to grit his teeth, grin, and announce a sunny, flamboyant and uncompromising endorsement of his own NFT-related plan. EA also joined the chorus, calling blockchain “the future of our industry,” although CEO Andrew Wilson will then go back to that statement for a bit. Otherwise, the valve steers away from the herd; it banned all blockchain, crypto and NFT related media from their own platform, Steam.

“The stuff that’s being done is super sketchy and there’s some illegal stuff going on behind the scenes, and you’re like, yeah, this sucks. Blockchains is a technology that is a great technology, and the methods used currently are quite sketchy. And you want to stay away from that,” Valve President Gabe Newell told Eurogamer when asked for clarification on the decision.

Back in 2018, Steam shut down BitSkins, a third-party Counter-Strike: Global Offensive blockchain-based store that was being used to launder stolen credit cards by buying skins and reselling them for take cash. Any game with a skin economy is specially monitored to make sure people don’t turn their ‘fun money’ back into real money — essentially creating a market for gambling.

Non-fungible Token (NFT) is a purely fictitious product based on blockchain encryption; Huge amounts of energy are used to ensure that only a finite number of these virtual “tokens” can exist. Almost all of them are stored on the Ethereum blockchain, are incredibly destructive, and use an expensive — by design — Proof of Work system, meaning that each new addition to it will requires more and more energy, increasing the cost of each coin mint or NFT.

If interest in this manufacturing grows, so will the demand. Meanwhile, the “supply” will remain fixed, thus pushing up prices. Any “profit” generated from the NFT is the result of artificial inflation. You convince people they need them, and you make it look like an investment. Like a pyramid scheme, one must convince others to jump on the bandwagon to increase the perceived “value” so that they can sell for more than the original price paid. In general, a zero-sum game.

“So they were like, why did I only pay $498 US dollars for this product? And if the answer is, you know, that’s what happens when you have a volatile currency that you’re paying out. That’s like today, you pay 99 cents tomorrow, you pay $498 for and people make people super cranky. So it’s not a good method. The people who are currently active in that space are usually not very good actors,” explains Newell.