The NiFTy Arcade collection shone out in the first week of GameStop’s recently created NFT marketplace.
The collection offered “interactive NFTs” connected to HTML5 games that were completely playable from an owner’s crypto wallet rather than simple JPEGs.
There was only one issue: Many of those NFT games were produced and distributed without the consent of their authors, let alone any arrangement for the authors to get a portion of any cryptocurrency revenues.
The owner of NiFTy Arcade has now been barred from selling NFTs on GameStop, but he’s still hanging onto the tens of thousands of dollars in cryptocurrency he earned from doing so prior to the ban. The unlicensed games themselves can still be accessed on GameStop’s servers and over a distributed file storage system, where they may now be functionally difficult to remove, even though the disputed NFTs are no longer featured on the GameStop NFT marketplace.
Arcades + NFTs
When asked to explain the value of newly created NFT versions of games that were already freely accessible elsewhere on the web, NiFTy Arcade founder Nathan Ello got a bit abstract, told a source that his collection arose out of a desire “to demonstrate potential use cases for NFTs beyond static images.”
In an interview, he stated, the objective is to design and showcase games that are playable within NFT marketplaces and within NFT wallets. “If people find value in these NFTs, that’s a bonus.” One is free to purchase a copy if they would want the convenience of playing the game directly from their wallet or their own profile page on the marketplace rather than having to go to mine.
As of July 15, Ello had sold hundreds of NFTs based on the first three games in the NiFTy Arcade collection, earning at least 46.7 ETH (about $55,000 at the time) from those sales. (Update: NiFTy Arcade has clarified in a statement that it only made 8.4 ETH from the initial sales of the NFTs in question.)
But for at least two of those games—Worm Nom Nom and Galactic Wars—Ello admits he never obtained the necessary consent from the original developers before selling them. The remaining 46.7 ETH cited was secondary sales, on which NiFTy Arcade earned just a 10% fee.
According to Joseph “Lexaloffle” White, the designer of the PICO-8 pixel game engine, there is evidence that Ello produced and distributed a number of other games via NFT marketplaces without the artists’ consent, including Breakout Hero, Super Disc Box, and Invader Overload.