Immutable and Polygon Labs create a strategic alliance for Web3 gaming

Immutable and Polygon Labs have formed a strategic alliance aimed at accelerating the adoption of Web3 gaming.

Immutable is the company behind ImmutableX and Immutable zkEVM for scaling Web3 gaming transactions on Ethereum. Polygon Labs makes Layer 2 Ethereum scaling solutions for the Polygon blockchain protocol.

The alliance brings together two companies that received close to $2 billion in investor funding in 2022. The companies hope it will have a significant positive impact on the multi-billion dollar gaming landscape. They’re announcing it at the Game Developers Conference in San Francisco today.

>>Follow VentureBeat’s ongoing GDC 2023 coverage<<

Zero-knowledge proofs are key

As part of the alliance, Immutable will power its platform products with Polygon’s zero-knowledge technology to accelerate digital ownership for gamers worldwide. This alliance simplifies decision-making for game studios and developers and provides a smart, safe choice for business leaders that accelerates time-to-market and gives them access to an ecosystem that will be one of the largest and most liquid for end users, the companies said.

Zero-knowledge proofs have led to much more efficiency in blockchain computing, Wyatt said. Zero knowledge enables a blockchain protocol like Polygon to know something is true or correct without needing much more information and computing, thereby getting rid of a lot of unnecessary data and the computing waste that comes with it. A zero-knowledge Ethereum Virtual Machine (zkEVM) is a virtual machine that executes smart contract transactions in a way that works with zero-knowledge-proof computations on the one hand and existing Ethereum infrastructure on the other.

At the core of this new relationship is the Immutable zkEVM, a new Ethereum Virtual Machine-compatible zero knowledge-rollup powered by Polygon technology and with full Immutable platform support. Building on Immutable zkEVM with the Immutable Platform will make developing Web3-enabled games faster, easier and less risky for large game studios and independent developers alike.

Widely touted as the holy grail of Ethereum scaling, zkEVM technology significantly lowers transaction processing times and fees, all the while remaining fully compatible with Ethereum and retaining its robust security model.

“That actually lets us scale pretty significantly,” said Ryan Wyatt, president of Polygon Labs, in an interview with GamesBeat. “And it also increases our security. It will allow us to hold more information, and scale that out while being more secure. So for us, it gets us ready for really mainstream adoption. How do you process hundreds and hundreds of millions of dollars in transactions that are happening on chain?”

What the alliance means for game devs

For Immutable, this means the company will be able to onboard more game developers to its platform than ever.

“Ultimately, for us, this is the leading Web3 gaming platform teaming up with the leading blockchain protocol, Immutable and Polygon, to create, what will be the one-stop vertically integrated solution for game developers and players,” said Robbie Ferguson, Immutable president, in an interview with GamesBeat. “And it means that our efforts now can be focused on how do we onboard the next billion plays on to Web3, rather than how do we optimize the current small ecosystem of Web3 players today.”

Still in its infancy, Web3 gaming has been held back by a dearth of high-quality games and a lack of scalable, enterprise-grade platform tooling. And it hasn’t helped that some Western game developers and gamers have come out against blockchain games.

“When we think about what our focus is for Polygon, it is to have a protocol that’s really easy for developers to build on. And for users to operate and use all the different apps that are in this ecosystem,” said Wyatt. “And so that’s the mandate. And basically, when I look at Immutable, they are the best gaming platform to build Web3 games on. It’s great to be a gamer inside of that ecosystem. And so for us, it felt like a better together narrative.”

He said Polygon is a base protocol layer and it spent a billion dollars in 2021 acquiring three different zero-knowledge teams. These “zkEVM rollups” changed the state of competition.

“That allowed us to really scale our infrastructure, scale our transactions and really deal with the demand and volume that we know is going to come with the adoption of Web3 games as they go mainstream,” Wyatt said. “When we looked at immutable, our goals are actually really aligned. You want to build this great ecosystem for game developers to plug in and focus on making great games and putting all of that on chain. And we are trying to serve as a protocol that enables everything from Starbucks to Nike, to Square Enix, and everything in between. And so for us, there was great harmony in our relationship. At the end of the day, we felt this would be great for game developers. And what’s good for game developers is good for gamers.”

This collaboration will make it easier for studios and developers to build high-quality games that support true asset ownership.

“By combining the No. 1 Web3 gaming platform – currently serving hundreds of game studios and millions of players – with Polygon’s best-in-class zkEVM technology, we are building an Ethereum-centric gaming ecosystem that is poised to take web3 mainstream and bring digital ownership to millions of people around the world,” said Ferguson. “Billions of dollars of skins are sold each year with no rights for players – we’re changing that so players are in control, and ownership is the expectation.”

Ferguson said that security has always been essential to any scaling solutions the company embraces. By expanding to Immutable zkEVM powered by Polygon, Immutable will be able to expand to custom scaling and be able to embrace many more customers and the transactions they bring with them.

“What Immutable is bringing to the table is an incredibly easy platform for game developers to build on,” Fergunson said. “You have this liquidity unification infrastructure, where no matter which one of these zkEVMs you’re building on, you have complete interoperability of funds, user wallets, and asset trades. And you could also trade between any marketplace with an Immutable global order book, which has more than doubled the volume of every game on our platform today, because more than half of our trades come from a different marketplace than the one that was originally listed.”

Two blockchain powerhouses

Immutable and Polygon have both enjoyed significant growth over the last two years, driven in part by their close ties to the Ethereum community.

Polygon Labs, a development and growth team for the decentralized Polygon protocol, in less than two years has built one of the world’s largest ecosystems for Web3 gaming dApps (decentralized apps), working with studios and publishers like Square Enix, Neowiz, Midnight Society, Plai Labs and Tilting Point, as well as esports teams and streamers like Cloud9 and Dr. Disrespect. Polygon has experienced an enormous increase in usage with a 94% increase in activity from 2021 to 2022.

“Partnering with Immutable is a monumental step forward in our mission to empower developers and enable users to truly own their in-game assets. By leveraging Immutable’s top world-class gaming platform, game development becomes seamless, allowing for the creation of rich and unique gaming experiences,” said Wyatt.

Well-known for being the first zk-rollup for NFTs on Ethereum, Immutable has experienced massive growth, with more than 140 new titles building on the existing platform, including the much anticipated Illuvium, brands such as GameStop, DC Comics, TikTok, Marvel, Warner Bros Discovery Sports, and IP from Disney and Star Wars through Ecomi. Last month it partnered with gaming giant Unity to provide game developers seamless access to Web3 gaming.

Immutable noted that Immutable zkEVM presents game developers with additional options, and does not replace its Starkware-based solution, Immutable X.

Scaling solutions that Polygon Labs initially developed have seen widespread adoption with tens of thousands of decentralized apps, unique addresses exceeding 220.8 million, over 1.18 million smart contracts created and 2.48 billion total transactions processed since inception. The existing Polygon network is home for some of the biggest Web3 projects, such as Aave, Uniswap and OpenSea, and well-known enterprises, including Robinhood, Stripe and Adobe. Polygon Labs said it is carbon neutral with the goal of leading Web3 in becoming carbon negative.

Getting Web3 to the mainstream

Of course, this kind of alliance isn’t that interesting if mainstream gamers don’t adopt blockchain games. In 2021, the conversation wasn’t so positive about blockchain games, Wyatt noted, as there was a ton of criticism about how blockchain games were scams or not fun or otherwise inconsequential.

“Last year, there was a lot of attention [on blockchain games] for the wrong reasons,” Wyatt said. “I think this is the year people start to better understand and have a more open mind of what the tech solutions are being offered and what you can do from a game development standpoint with those tech solutions.”

Wyatt said it was fair to criticize the early Web3 games as being “incredibly unappealing.” But he noted more than $2 billion of capital has been invested in blockchain games and those haven’t surfaced yet.

At GDC 2023, he thinks the conversation will be different. In the long term, he believes that digital ownership will become core to gaming.

“What you’ll start to see on the horizon are really exciting games that I think we can point to as gamers and be really enthusiastic,” Wyatt said. “This week, the goal for us is to really just simplify things at the end of the day. For games to succeed, they just have to be great games. And you have to just focus on making games that people want to play. Often, in this Web3 blockchain narrative, that gets left out. This is basically a tech stack and infrastructure that people can tap into. We’re getting back to the basics of making great games.”

Separately, Ferguson said there is a tokenomics upgrade happening now that the company is expanding to EVM and smart-contract-compatible environments. Immutable will overhaul the utility of $IMX with a few improvements. So $IMX will be the core gas currency of Immutable zkEVM, which will be used to prioritize and sequence transactions.