San Francisco-based social and mobile game monetization specialist SuperRewards announced on 31st March that it will allow users to buy in-game virtual currencies from publishers such as A Thinking Ape, East Side Games Studio and Ninja Kiwi using bitcoin.
Bitcoin payments made by SuperRewards customers will be processed and converted to fiat currency by fellow San Francisco-based startup Coinbase. SuperRewards will then pay game publishers in US dollars.
Speaking to CoinDesk, SuperRewards co-founder Lyal Avery, indicated that adding bitcoin as a payment option lets his company take advantage of a natural overlap between its customer base and the digital currency's avid users.
"We feel that it's a natural fit for someone that wants to buy virtual currency to use a digital currency."
Unlike digital currencies, which can be exchanged for real-world money, virtual game currencies have value only within a specific game title or series of developer titles.
The most notable example would be popular social game Farmville's Farm Bucks, which can be purchased and traded for exclusive in-game items or special advantages.
Customer demand for bitcoin
Though SuperRewards supports a number of other payment options – from scratchable prepaid cards to pay by fax, Avery says that customer demand for bitcoin has been strong.
"We've had a bunch of emails in our support queue asking when we were going to accept bitcoin. It's something we want to be ahead of the curve on."
This may not be surprising given the company's business model of facilitating alternative payments for global audiences. For example, Avery notes that he's been following bitcoin with interest for years.
Digital currencies in gaming
Bitcoin's potential to increase in-app payments for mobile games has been heralded as one of its most promising use cases, one encouraged by news that companies like social gaming giant Zynga and now SuperRewards are testing the waters.
However, while it may seem that digital currencies and virtual currencies are either extremely similar or competing options, Avery clarifies that they each have a specific role in online transactions. Digital currencies provide the potential to reduce publisher losses from fraud and chargebacks because they redefine the protocol of an online transaction. Virtual currencies allow those same publishers to construct digital economies and drive engagement among users.
Due to these benefits of digital currencies, Avery suggests that their expansion in the mobile and social game markets may come quickly:
"What I do see as being really interesting is the intersection between the mid-core and hardcore gaming market and how fast they're adopting bitcoins."
Avery notes that publishers have asked about receiving payment in bitcoin, though for the moment, this isn't something SuperRewards is prepared to offer due to legal complexities.
Founded in 2007, SuperRewards has partnerships with more than 2,500 publishers, and was purchased by game monetization company Playerize in 2012.
Further, it is not strictly a payments company. In addition to letting users pay directly for in-game currencies, SuperRewards also allows publishers to offer free virtual currencies to users who watch videos, sign up for a new service or take a survey through its offers program.
Playerize has raised a total of $2.5m from investors that include Real Ventures and Rho Ventures.
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.