Gotta Go Slow: 'Sonic' Creator Sega Rethinking Crypto Games, Won't Use Major IP

By Kate Irwin

Sega, the traditional gaming giant known for Sonic the Hedgehog and its 80s and 90s-era consoles, is easing away from blockchain games, according to a Bloomberg report.

Sega Co-Chief Operating Officer Shuji Utsumi told the outlet that the game studio will keep its largest franchises from being licensed for third-party blockchain games and won’t develop its own in-house games, either, out of fears that its content might be devalued by blockchain integrations.

“The action in play-to-earn games is boring,” Utsumi said in reference to heavily financialized games that use crypto. “What’s the point if games are no fun?”

In fact, Sega’s stance on crypto has turned from curious exploration to one of doubt. In 2021, Sega announced plans to release its own NFTs. Last year, Sega producer Masayoshi Kikuchi cited NFTs as a part of the studio’s “Super Game” initiative, a multi-title, interconnected franchise with a creator-centric focus. The Super Game program is largely under wraps, but Sega has slated its release for 2026.

Now, Utsumi is one voice at Sega that wonders whether NFTs and blockchain will ever see wide adoption in gaming.

“We’re looking into whether this technology is really going to take off in this industry, after all,” Utsumi said.

While Sega will not license out its Sonic IP for a blockchain game or develop its own anytime soon, the studio may still license out its smaller titles, Utsumi said. Sega has already licensed its Sangokushi Taisen IP to developer Double Jump Tokyo, which is using the property to create the game Battle of Three Kingdoms on the Oasys blockchain. 

Artwork from Battle of Three Kingdoms on Oasys. Image: Double Jump Tokyo

Blockchain game development has split into two different approaches post-Axie Infinity, which yielded over $4.2 billion in total NFT trading volume (mostly in 2021) but then saw a large dropoff in players and a $622 million hack in early 2022.

While some game developers are still marketing their titles’ financial and play-to-earn elements, many others—such as the games highlighted on GG’s Most Anticipated Games list—are taking a gameplay-first approach and often make NFTs optional for players. 

“For the majority of people in the video game industry, what blockchain advocates say may sound a bit extreme, but that’s how the first penguin has always been,” Utsumi said, citing an analogy about risk-takers.

Some large, traditional game publishers like Square Enix, Nexon, and Ubisoft are moving forward with original blockchain games in development. But others—especially developers based in the West—are taking a more cautious approach.

Despite Sega’s move away from blockchain gaming more broadly, Utsumi still sees the space as one to watch.

“We should never underestimate them,” he said of blockchain proponents and other “first mover” types in tech.

Sega did not immediately respond to Decrypt’s request for comment.

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