What is Enjin (ENJ)? [A Comprehensive Guide to Enjin]

By Mr.CryptoWiki | cryptocurrency | 1 week ago

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If there is anything that Ethereum has told us, it is that there is a lot more possible with blockchain technology than we initially thought. Versatility through Turing-complete smart contracts was the name of Ethereum’s game, and it has spawned a wave of new use cases that underscore the potential for blockchain technologies to decentralized not just the exchange of money, but the exchange of value.

ERC-20 tokens form a good portion of the market, which is a good a sign as any that Ethereum is plodding along well on its path to becoming a decentralized world computer. These tokens find application in decentralized finance (DeFi), cloud computing, supply chain management, bookkeeping, gaming,  prediction markets and so much more. 

What ERC-20 tokens do - as opposed to Bitcoin, which functions as a store of value and decentralized money - is that they bring the decentralization to everyday use cases, arguably doing just as much as Bitcoin to open the public’s eye to blockchain technology. 

The video game industry, which is the fastest growing entertainment industry in the world, is particularly suitable for cryptocurrency application, given that several premier games possess in-game economies. And as potent as ERC-20 tokens are, new token standards are also forming, and the project we’re looking at today employs a different Ethereum standard on its network, which comes with its own unique benefits. The project is Enjin (ENJ), which uses this new standard to find application in the gaming industry.

I’m going to go over Enjin’s history, its purpose and the technical design that underpins it, the partnerships it has formed and the competition it faces. 

The History of Enjin (ENJ)

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Enjin, a gaming community platform, was founded in 2009, though the ENJ token was itself only launched in 2017 with the advent of blockchain technologies. The project was founded by Maxim Blagov and Witek Radomski, and is headquartered in Singapore. 

The project conducted its pre-ICO in August 2017, and closed its ICO in October, raising just under $23 million and falling shy of its $25 million cap. This was followed by a Series A funding round with the lead investor being leading venture capital fund Blockchain Ventures.

Enjin’s mission, at its essence, has to do with empowering gaming communities, with it being described as a mission “to radically transform gaming by bringing real-life economies to virtual worlds.” 

Anyone who has a little experience in video games will know that in-game currencies and purchases are quite popular and, in some cases, make up the majority of a particular game’s revenue. Free-to-play games, Massively Multiplayer Online Role Playing Games (MMORPGs) and mobile games - all of which constitute a good portion of the market, are particularly like to see in-game purchases, as proven by this graph available in Enjin’s whitepaper.

There are several reasons as to why Enjin’s mission makes sense. Given the frequency and volume of in-game purchases, blockchain technology’s well documented strengths in reducing transaction times, lowering costs and permitting assets of different natures to be exchanged find ripe application here as it would in any other system that sees us frequent trading. I go into all of this in detail in the following section,

Following the ICO in 2017, the development team spent the rest of the year ensuring that the token achieved some liquidity, getting listed on exchanges like Binance. It also formed many partnerships (described later) and early 2018 saw the launch of the Android version of its Enjin Wallet.

2018 was a more significant year in terms of adoption and development, though the team did ensure that the token was listed on some major exchanges. This included the launch of the iOS version of the Enjin Wallet and a network launch on the Ropsten testnet. Other notable milestones of 2018 include the proposal of the ERC-1155 token standard, development efforts into launching smart contracts on the mainnet and updates to several other features of the Enjin platform.

The team has compiled a list of major events of Enjin’s history, which covers it comprehensively, and is well worth viewing.

The Purpose of Enjin (ENJ)

The Enjin platform and the ENJ token is purely gaming focused. The features are numerous, with the technology underlying these features being particularly suitable for the application. What the platform provides is an ecosystem of products that when put together, benefits the three major groups of stakeholders: game publishers and content creators, communities and gamers themselves. 

At the core of everything is the ENJ token itself, which is built on the ERC-1155 standard. This is the major selling point of the platform and is well worth discussing in detail. 

The ERC-1155 ‘multi-standard’ that the Enjin team has created allows for both fungible and non-fungible tokens to be minted in a single smart contract. This may seem like a lot of mumbo jumbo, but it’s not, and it’s actually a pretty big deal. It can be roughly translated into ‘You can easily create tokens for in game currencies that can be easily traded or substituted for another.’ 

Imagine someone buys a ‘skin’ in a game - with a platform like Enjin, it could be possible to trade this for another item in the game, or sell it to another player. This has enormous potential in an activity where this happens regardless, only much slower and at a greater cost. The website itself describes the advantages of the standard best:

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The team has published a reference implementation of the ERC-1155 standard, for those interested in the technical aspect of the standard.

However, the strongest feature of the platform, in my opinion, is the fact that cryptocurrencies and the blockchain can be incorporated into video games. The target audience with this are game developers and game publishers, who stand a lot to gain from the implementation of cryptocurrencies (more user participation, better revenue, in-game reward systems etc.).

The platform encourages ideas and addresses pain points that are already discussed in video game circles. For example, developers could create game assets and them gift them to gamers as a way of saying thank you for crowdfunding. Or take this paint point: if users sell their items on a third party marketplace, the game developer can get a cut through a transfer fee, recouping some of the loss. And then there’s gamification, which can be applied in a myriad of creative ways. The possibilities with streaming channels are also endless. 

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Subscription services, marketplaces, channel/game supporter tiers with appropriate rewards and trading platforms - this is only the tip of the iceberg for an entertainment medium that is deeply connected with technology, and which is only just beginning to grow out of its infancy. The team has already made some progress with respect to the marketplace, which has been updated very recently:

Other features worth mentioning are the Enjin Wallet and EnjinX. The former is used for storing funds and (through a partnership with CoinSwitch) allows them to trade tokens at attractive prices, while the latter is a blockchain explorer.

I recommend reading the Enjin whitepaper, which goes over the advantages for every stakeholder and potential use cases very well.

Partnerships

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When it comes to partnerships, Enjin shines, and shines quite well, having nabbed some considerably big partners. The project has received a lot of media coverage for its partnerships and is rightfully so, since the specific partners are those with great clout in the video game space and/or are highly successful companies.

The first partnership that should be mentioned is the partnership with Samsung, which has added the ENJ token to its flagship smartphone Galaxy S10s in-built blockchain wallet. ENJ was one of the few tokens to be included in the wallet - not even Bitcoin was made available, at least initially. This drew a lot of attention towards Enjin, a project that many had not heard about, and this was certainly true for those who had little familiarity with the cryptocurrency market. 

As far as gaming partnerships go, Enjin has partnered with some big names in the industry.

Enjin has also partnered with Unity Technologies, the company that is behind the world’s most popular game engine Unity. This partnership sees the Enjin SDK available on the Unity Asset Store. This sees Enjin’s blockchain tools put in the hands of game developers, allowing them to implement the token based features into their games. 

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Enjin has also partnered with long running and prominent gaming publication PC Gamer, ostensibly helping the latter in their role as a content creator. Though this outcome has not been explicitly mentioned, it is not unreasonable to assume that in the future that this partnership could somehow see itself integrated with the publication.

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The team has also formed a strategic partnership with Japanese company HashPort Accelerator. The partnership will see HashPort act as a business liaison, helping the token get listed on exchanges and find adoption. Enjin will work towards deploying their products and services in the Japanese market. 

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Lastly, Enjin has partnered with CoinSwitch, a cryptocurrency exchange aggregator platform. This allows Enjin wallet users to trade their tokens at competitive rates using CoinSwitch’s algorithms.

Competitors

Enjin has a smattering of true competition in the space and, in any case, it is the runaway leader in this niche - just look at its list of partners and it’s instantly clear as to why.

The only relevant competitor that Enjin faces is Dream (DREAM), which focuses more on e-sports. While it could very well go on to have the kind of broad application  that Enjin is operating with, it is still no match for the latter, which has achieved a tremendous amount of adoption and made deep in-roads with entities in the gaming ecosystem. Not that Dream does not have as a purpose as a means of exchanging different game assets, gamification and/or rewarding players, but Enjin is solidly in the lead in terms of scope and execution, and is broader in its scope.

It should also be noted that there are other gaming tokens, like FunFair (FUN), RevolutionVR (RVR) and GameCredits (GAME), but they are different enough in their respective purposes that you couldn’t really consider them to be token in the same vein as Enjin.

As it stands, Enjin has a good grip on this niche and this is probably because of the actual development and business strategy that it has executed. 

Conclusion

It is really clear that there is a lot of potential for cryptocurrencies in the gaming industry. Of that, there is absolutely no doubt. 

Enjin stands at the top of the gaming cryptocurrency niche, and is proving to be a real sleeper hit as it makes inroads in the gaming industry. For those investors who are keen on investing in tokens that find use in very specific niches, Enjin is hard to resist, given that it is both the leader of its niche and the niche itself is perfect for the use of cryptocurrencies.  The only caveat is that the ecosystem will have to see more entities join, entities that actively make use of the platform’s features. With successful trial runs, perhaps in a AAA game, Enjin could very well take off and go to the moon.


Mr.CryptoWiki
Mr.CryptoWiki

In crypto since 2002 ;)


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