How Halo’s future could be saved by web3

343 Industries has been heavily under fire by the Halo community for the past few weeks.

Could web3 help build a brighter future for Halo? Here’s how it might be able to…

IYKYK, if not, here’s context on the situation with Halo & 343 Industries:

What are Halo and 343 Industries?

Halo is the golden child of Xbox and is its flagship exclusive title. The franchise generated over $6 billion in sales in 2016, and in 2022 further boasts a TV show, comics, and more IP. Halo is Xbox’s most successful franchise. For many, (like me) Halo was their favorite game growing up.

343 is a Microsoft-owned developer studio responsible for the Halo series. However, they weren’t the original creators, that title goes to Bungie. 343 was forged in Microsoft specifically to take over from Bungie after Halo 3. Now, 343 are responsible for shipping the game.

What are the problems Halo and 343 Industries are currently facing?

At the heart of it, the problems behest Halo and 343 stems from 343 not understanding the heart of the franchise. This has meant that 343 has made development decisions that are in opposition to what the community actually wants. What triggered the recent issues is 343 announcing they would not be releasing a split-screen function for the game - despite promising this repeatedly before. This triggered a massive outcry across the community, as this was a feature many of us had been waiting for. For most Halo fans, this was one of the things that made the original Halo experience so fun. 343 has also faced many other issues over the prior years with similar other empty promises & disappointments. All of this has culminated in the current outrage from the Halo community.

See the subreddit post berating 343 Industries here.

Above is a screenshot from a single subreddit with over 15,000 upvotes in anger at how deeply 343 Industries has misunderstood the Halo franchise. For example, while the community views Halo as a fun (sometimes silly) pick-up and play game, 343 see Halo as Call of Duty - a competitive vs a social online experience. This is a deep, dangerous disconnect that has led to decisions being made away from product-market fit.

So, how could web3 solve the issues for Halo?

With community-driven development to achieve true PMF using DAO mechanisms.

What does a Halo DAO actually mean & how would it work? This is where every purchaser of Halo can be awarded 1 Halo governance token. Halo tokens can then be used to vote on community proposals that determine what features/items are worked on first. For example, voting can be done for every Halo Season (every 3 months), and during this time the community can submit & vote on proposals. These proposals can be for things like new features, new maps, new skins, and new game types, to even new open-world side quests & more.

What are the benefits of a Halo DAO? If 343 operated via a DAO-based community voting protocol to decide what new features, skins, game modes, and maps to focus on, then all decisions made should always be closer to product-market-fit (PMF) outcomes. For example, 343 would not have made the wrong internal decision to cancel the split screen feature, as the community would have voted for it to be prioritized. Therefore, with a fully decentralized voting mechanism for proposals, in theory, it should be easier for 343 to ensure it’s building with genuine PMF in mind. This benefit comes from the market helping to shape what is built and is a great example of how web3 brings community to the forefront.

What can and can’t be voted on? Bug-related technical issues, back-end changes, and story decisions should remain in the hands of the core team to protect the IP. Things like new features, maps, skins, and other non-core franchise decisions are the things that the community could make proposals for and vote for.

What are the drawbacks of a Halo DAO? Community proposals and internet hive minds don’t always produce what is intended. For example, the fabulous Boaty McBoat Face. However, there are some more serious disadvantages. For example, malicious actors could buy people's Halo tokens to pass a proposal that is bad. Halo users could also vote on distasteful things, and if the community isn’t active in voting then it would just take a small group of bad actors to submit and pass bad proposals.

Are there solutions to these drawbacks?

There could be soon, below are a few...

Solution 1: Using Soulbound NFT’s for malicious actors buying all the Halo governance tokens

To get a governance token that allows you to vote on proposals, Halo could require you to first purchase Halo, then you get 1 untradeable NFT for this purchase. Halo can then airdrop 1 governance token to wallets with this untradeable NFT. These untradeable NFTs are known as Soulbound NFT’s, or SBNFT’s (see here). This would mean malicious actors would have to purchase large amounts of the game to get the token to vote, as the token itself can’t be privately traded in any marketplace. While SBNFT’s are not available yet, they are something Vitalik has mentioned many times, so keep an eye out for them becoming a possible solution soon!

Solution 2: Minimum thresholds for votes, and/or internal community council representatives

To prevent silly or malicious proposals from passing, a quorum of a minimum amount of votes needed for a project to pass can be set. This can, for example, require at least 15,000 total votes to be needed before things can get passed. In addition to this, 343 could also internally shortlist community proposals for voting to add a layer of protection. These internal community council reps can themselves be elected based on DAO votes and can be the community managers for the franchise. Halo can also incentivize participation through various mechanics, like giving people who vote exclusive in-game skins.

Solution 3: Using web2 style wallets and apps to allow easy voting participation

The problem currently is that not many people know how to vote with a governance token, or even how to get one into a wallet. However, with companies like Snapshot, which provides an easy voting platform, along with wallets like Argent, creating L1 & L2 wallets using web2 UI are all working to reduce the friction of participation. As more innovations like account abstraction and social recovery are invented, along with platforms that make participation easier, this problem of low participation due to high barriers to entry should fall.

So, can web3 actually save Halo?

Perhaps not today, but it could help soon…

Right now, some of the technical limitations and lack of mainstream adoption make it difficult for web3 to truly solve all the issues in a safe and sensible manner. However, 343 could look to web3 as a solution for ways to actually understand the community and build with PMF in mind. This would also help to win back the faith in the community as 343 would be empowering the community to be part of aspects of the decision-making process. While web3 could solve many of the problems, the true problems at 343 are from deeper issues. As a true Halo fan, I sincerely hope 343 takes more of a community-driven approach to building, be that with or without web3 mechanisms.