Square Enix President Yosuke Matsuda is taking gaming in a new direction.

Matsuda leads one of Japan’s biggest video game companies. And back in January, he sent a letter to the public.

Surprisingly, the letter wasn’t about the company’s popular franchises.

Instead, Matsuda focused on blockchain and NFTs.

In the letter, he highlighted “token economies.” He also referred to 2021 as “NFTs: Year One.”

Matsuda added: “I look for [NFTs] to become as familiar as dealings in physical goods.”

And recently, he said he wants to “provide incentives” for players to create content for his company’s games.

He noted that NFTs could be the way to do just that.

To me, this means one thing. NFTs are going to transform the $200 billion gaming industry.

And that creates a massive investment opportunity…

Gaming on the Blockchain

Microtransactions in games are nothing new.

That’s when companies sell virtual items for a small cost.

These sales can add up fast.

Research and Markets estimates gamers spent over $34 billion on them last year.

But NFTs are better than microtransactions in two ways:

  • Players can buy and sell virtual items on the blockchain.
  • The creator makes money via royalties every time an NFT is resold.

That’s why companies like Square Enix are in a rush to figure out how to put their games on the blockchain.

In fact, a report by DappRadar shows that blockchain-based games are 2,000% more popular than they were a year ago.

Games now make up over half of all the activity on the blockchain.

This incredible growth is largely due to play-to-earn games. (My colleague Andrew Prince wrote about those on Wednesday.)

These games reward players with tokens or NFTs.

The players can then choose to trade those rewards for cryptos or dollars.

Of course, these games are made by smaller companies and aren’t perfect.

You may have heard about the hackers that stole $650 million in Ethereum from the game Axie Infinity.

But investors poured $2.5 billion into this space just in the past three months.

So these games will have more resources and better security going forward.

A New Step in Gaming’s Evolution

The gaming industry is headed for massive growth this decade.

GlobalData estimates the market will grow to $475 billion by 2030.

That’s over double its current size of $200 billion.

And as you can see in the chart below, mobile games make up more than half of that revenue.

global video games revenue

But due to NFTs, I think this estimate is too conservative.

That’s because NFTs are a whole new step in gaming’s evolution.

Masayoshi Kikuchi, a producer at Japanese game developer Sega, recently said something similar.

He suggested that gaming “will expand to involve new areas such as cloud gaming and NFTs.”

Sega registered a trademark for its NFTs in January. And it could feature them in its upcoming “Super Games.”

Bigger Than Bitcoin

You can add exposure to gaming stocks with the Global X Video Games & Esports ETF (Nasdaq: HERO).

Its holdings include Square Enix and other innovative gaming companies.

But another possible investment is the “Next Gen Coin.”

This crypto is the key to NFTs and blockchain gaming.

That’s one reason why Ian King believes it will be 20 times bigger than bitcoin.

And the good news is: You still have time to buy the Next Gen Coin before it explodes higher.

You can learn all about it by watching Ian’s new presentation.



Jay Goldberg

Assistant Managing Editor, Banyan Hill Publishing

Morning Movers

From open till noon Eastern time.

Inozyme Pharma Inc. (Nasdaq: INZY) engages in developing therapeutics for rare diseases. The stock is up 17% after SEC disclosures indicated that several executives of the company and a board member recently bought over a million shares of the company.


Insteel Industries Inc. (NYSE: IIIN) manufactures and markets steel wire reinforcing products for concrete construction applications. The stock rose 12% after the company managed to beat second-quarter estimates thanks to strong demand for its reinforcing products and price increases to combat inflation.


United Airlines Holdings Inc. (Nasdaq: UAL), the airline operator, is up 11% this morning. The stock is up despite missing first-quarter earnings because the company forecasted a return to profitability in the second quarter thanks to the rebound in travel.


Valmont Industries Inc. (NYSE: VMI) produces and sells fabricated metal products internationally. It is up 8% after the company beat managed to beat both earnings and revenue estimates for the first quarter and raised its full-year guidance.


Green Plains Inc. (Nasdaq: GPRE) produces, markets and distributes ethanol for various uses. It is up 8% after the company achieved a breakthrough in its fermentation and production process allowing it to further scale its ability to supply a strategic ingredient to the fast-growing renewable diesel market.


Mesa Air Group Inc. (Nasdaq: MESA) provides regional air carrier services under capacity purchase agreements with American Airlines and the United Airlines. It is up 7% today thanks to the optimistic outlook for travel from both United and American Airlines.


Nuvve Holding Corp. (Nasdaq: NVVE) develops and commercializes vehicle-to-grid (V2G) technology and offers electric charging solutions. The stock rose 7% after the company was selected as a collaboration partner with U.S. Department of Energy to accelerate the availability of V2G technology.


Nucor Corp. (NYSE: NUE) manufactures and sells steel and steel products. The stock is up 7% after it managed to exceed first-quarter earnings expectations thanks to the rise in steel prices during the quarter.


Akzo Nobel N.V. (OTC: AKZOY) engages in the production and sale of paints and coatings worldwide. It is up 7% after the company reported better-than-expected results for the first quarter and said that it expects lower raw material costs in the second half of the year.


Steel Dynamics Inc. (Nasdaq: STLD) is a steel producer and metal recycler. The stock is up 6% after the company posted strong first-quarter results and said it expects the trend to continue thanks to strong demand and high prices amid inflation and supply disruptions related to the Ukraine-Russia war.