Crytek is doing its own physics. They have their own engine for physics in their Cry engine 2 and we can tell that physics looks good.

When we asked the guys about Nvidia's and Havok's physics we were told that for the time being they don't need them or want them. You can destroy just about anything in Crysis from trees to vehicles with very realistic movement of their own, and gunshot physics are impressive, too. Crytek usually does all physics on the CPU, but it might do some things on a GPU.

In the future Crytek might consider going after Nvidia's approach and physics, but only if it makes sense. Currently they are happy with their own physics and when they sell their engine, they sell it with their own physics. The good thing is that the customer can further adjust the physics for its needs.

We've seen Cry engine 2 physics in action and the company can create a quite impressive nuclear blast that will look quite realistic, but naturally not every particle in the cloud interacts with each other.