Steam players no longer require a Microsoft Account to play multiplayer
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While not logged into a Microsoft Account, you can host and join standard world multiplayer sessions with players from your Steam friends list
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Note: a Microsoft Account is still required for Crossplay, Shared Worlds and Playgrounds
It does. Or, did anyway. I have no idea now, cause I got the game before they took this out. I already knew my Microsoft login because I had just recently unsubbed from game pass, and that’s part of the reason why I bought it on steam.