Used to be it just meant Non Player Character in a video game. Now it's an insult to suggest a person is asleep at the wheel and believes all the 'obviously' false mainstream narratives. Of course it's not so obvious is it otherwise it wouldn't work.
Of course the true definition of NPCs as it pertains to video games is much more important than many people (even gamers) assume. NPCs are the foundation of every MMO's economy: from gold creation to resource sinks to starting questlines to the action house. NPCs control all the levers of power, and we can trust them because they aren't people that have something to gain. They're just code, and code is law.
Every MMO gives players an incentive to cheat. It is a micro-economy, after all, and all the same rules apply. Even if there is no direct fiat connection to gold in an MMO: there was always a 3rd-party gray market to fill the niche that paired players that wanted to buy gold with players that wanted to sell gold. It can't be stopped. People are people. Markets will always be made. Supply will always meet demand.
The easiest way to cheat any economy is the classic Sybil attack. This attack comes in many forms, from one person having 20 accounts to botting the game in a completely automated way. No one has ever figured out a way to prevent the Sybil attack, and surprisingly enough no one seems to have even attempted to do so using conventional means.
In the real world economy Sybil attacks are mitigated with KYC and official documentation. Of course we all know this isn't 100% effective, but it is effective enough for the system to work without imploding (for the most part). So why do video game developers never force their playerbase to KYC?
Creating a KYC economy in game is never worth it within a WEB2 ecosystem. This makes a lot of sense when we understand what WEB2 stands for and how that business model works. The absolute best WEB2 systems offer free service and need as many users as possible in order to monetize the swaths of data they gain access too. Or in the case of a game like League of Legends the idea is to hook 1% of the players who end up spending thousands of dollars on skins.
Obviously not all video games are free to play, but the model is still very much WEB2. Many do not realize this because they take for granted everything they do get for free (while complaining about everything that isn't). Unless you're playing an MMO like WOW and paying for a subscription: online play is almost always free. This has been the case all the way back since Battle.net in 1996.
Yes, you might have paid $50 or $60 to buy the game, but you didn't have to pay to connect to the API. You didn't have to pay to get updates. You didn't have to pay to play with other players. Everyone had unlimited access, and some people would play for 16 hours a day without even thinking about how crazy it was that it was all free service. Sometimes I feel like I'm the only one.
That's too big of a hurdle for many people, especially 12-year olds without a bank account. And it comes at very little gain to the developers of the asset. However, ironically enough, WEB3 can employ things like KYC and paid service to mitigate Sybil attacks. WEB3 is all about paying for service and building up your reputation within the community (even if payment is a derivative asset like RCs). This becomes exponentially compounded due to the community itself owning and operating all the infrastructure.
This is something I have spoken on many times, but I don't think anyone actually takes me seriously yet. First of all: crypto people are notoriously anti-KYC. Even 
Hive does not have these types of reputations or legacy KYC. There are at least 100 accounts on Hive that I could be at least 99% certain are all individual people. This number would be exponentially higher if I was actually trying to implement WEB3 KYC on this chain. I'm sure there are dozens of accounts I could trust to help me build it out and find more unique people.
However ironic it would be to create a permissioned video game on the Hive blockchain that only certain accounts could access: it would almost certainly eliminate any and all Sybil attack vectors. The game would quite possibly be the most impossible-to-exploit economy of all time.
I'm thinking about this a lot more these days because my involvement with Golem Overlord and thinking about my own project ideas that I'd one day like to build out. It's weirdly possible that the future of gaming on the blockchain is based on community reputation and exclusivity. They don't have to be open systems because they don't need to be monetized in such a way that requires more and more users constantly buying in.
A sustainable and balanced community is all that is required in WEB3. The paradigm is totally different, and I think most crypto devs don't realize this, let alone know how to navigate the ecosystem. Rather, we just keep pumping out the same pay-to-win garbage over and over again expecting a different result. Kind of crazy honestly.
Imagine what it will be like when NPCs are controlled by AI. Not only will the NPC not have an incentive to exploit the economy, but they are programmed to make it better and even have some semblance of intelligence. AI + crypto could create games that are a thousand times more advanced than anything we've ever seen. We aint seen nuthin yet.
Making a game more difficult makes it harder to bot. It also makes it harder to multi-account. I've always been a huge fan of games that are very difficult with high risk and high reward. Crypto is on the verge of being able to create such a thing with relative ease, and once that happens it will be cloned and forked a thousand times over, creating dozens of badass variants that everyone wants to play.
The ability to eliminate KYC altogether would also be a huge boon to any economy. How does one accomplish such a thing? Well basically we have to make it unprofitable to play multiple accounts and very profitable to invest everything you have into one.
The problem with this strategy is that good players that get in on the ground floor can end up dominating the game forever and burning the bridges they crossed behind them. This is an even worse problem than a Sybil attack, and isn't fun for anyone except the exploiter. Balancing a game is one of the hardest things to do, and unsurprisingly also the most important. It all depends on the specific implementation. The Devil is in the Details.
A game like WOW has dozens if not hundreds of servers worldwide to choose from. After a while they even implemented ways to transfer servers from high population ones to low population ones. While this would also be possible in WEB3, there is also a certain complexity involved because we have to assume that users on one server wouldn't want their economies to be exploited by another server.
Perhaps one server option is very exclusive and has the WEB3 KYC I was talking about; a permissioned system. Well if anyone didn't like that: the code is open source so they could just clone the code and create a non-permissioned solution that allowed anyone to play. This is somewhat how I envision it happening. Many clones of the same game that operate slightly differently or have a different player-base and/or whitelist.
Depending on how an MMO is designed you might only need 100 active players per server for the game to be fun, engaging and balanced. Normally it's something more like a couple thousand. But still that's a very tiny amount compared to the total player base across all servers. It makes sense that some of those servers could be invite-only exclusive clubs with DPOS voting. Just spitballing here at this point.
This post was a bit all over the place and seems to lack focus in my opinion. I still have a lot to say about these issues but I think they need to be organized a bit better before I continue.
For the most part in terms of blockchain gaming we need to be thinking about how important NPCs are to economies and how those NPCs could soon be governed by advanced AI systems that are relatively cheap to implement. We also need to be thinking about all possible ways to mitigate the Sybil attack vector: up to and including sovereign permissioned servers and communities that vet their own players constantly. High-risk/high-reward hardcore mode is a personal favorite.
