Sep 122018
 

CryptoKitties, the popular gaming and collectible app where players breed cats on the Ethereum blockchain has reached the one million cat milestone – less than a year after launch. The game became hugely popular in December 2017, coinciding with the peak of the crypto bubble. It has subsequently lost over 90% of the players active at the peak. However, a set of core players continue to breed and collect CryptoKitties.

On the back of its December success, the company behind CryptoKitties, Axiom Zen, raised a $12 million round led by the famed venture capital firms Andreessen Horowitz and Union Square Ventures. During the same time, the game’s popularity led to a significant increase in fees on Ethereum.

Beyond the Hype

Although interest in the game has waned since the peak, the game continues to attract new users. Just last week, collectors bid up the prices of #1 fancy cats in the game to as high as 30 ETH per cat. CryptoKitties was one of the first blockchain games to master the correct use for ERC721 non-fungible tokens. Since its launch, many copycats have launched without much success.

Axiom Zen encouraged players to breed more to reach the one million cat milestone. This was done via a giveaway of 20 exclusive cats. Exclusive cats have a custom artwork on the frontend instead of the appearance of the cat being determined by the genes. These are generally valued by collectors due to their rarity. ‘Kitten Mittens’, the most prolific breeder in the game, won the first exclusive during this giveaway.

Vulcant exclusive cryptokitties

Leading the Way

CryptoKitties continues to be one of the most popular applications built on Ethereum. The success of CryptoKitties has encouraged many other entrepreneurs to work on gaming products on the blockchain. The advantage of using the blockchain is that players are in control of their in-game assets. How much of a game changer this is for traditional online games remains to be seen. The trade-off is the cost. For example, in CryptoKitties, it takes 0.008 ETH to breed a single cat.

Other games are exploring ways to minimize the cost of gameplay by handling more of the interactions off-chain. Even though the ‘genetic’ data of the cats in CryptoKitties is stored on the blockchain, the actual image of the cat isn’t and the ‘owners’ don’t actually have the rights to that image.

Gaming vs. Collectables

CryptoKitties has tried to balance the collecting aspects with the gaming aspects from the beginning. Most of the high value transactions on CryptoKitties tend to be from collectors or speculators. Axiom Zen has introduced ‘fancies’ in the game as a way to encourage continued breeding. ‘Fancies’ are cats with a specific pre-determined trait combination, as determined by the company. This information is not decentralized or stored on the blockchain, however.┬áThese fancy cats have their special custom artwork.

These fancy cats also tend to be one of the most expensive set of cats to be traded. This is because of their special artwork and also because the number of fancies of each type are limited.

As CryptoKitties continues to gain traction, there are third-party applications being built on top that help players with the game or for the collecting aspect of it.

Aug 292018
 

CryptoKitties, the popular game of breeding and collecting cats on the Ethereum blockchain, has seen a huge surge of sales over the last couple of days, driven by demand for its ‘fancies’. According to the community created website Kitty Explorer, over 693 fancy cats changed hands within the last week, with the maximum price of 20 ETH.

Fancy cats are special cats created in the CryptoKitties app that can be bred using a specific combination of genes until a limit is reached (limit can be time-based or total number of fancy cats based). Fancy cat recipes are created by Axiom Zen, the creator of CryptoKitties, and is not recorded on the blockchain per se. The actual ownership of the cats in CryptoKitties is recorded on the blockchain, and players use third-party extensions like Metamask to buy, sell, and breed the digital cats.

CryptoKitties received a lot of press in December 2017 when a single cat sold for over $100,000. For a while, its popularity caused significant delays on the Ethereum blockchain and increased the gas price. Since those days, however, the activity on the game has dropped precipitously.

Fancy Cat Craze

Over the last two days, even though the number of players measured by unique addresses hasn’t gone up much, the total sales volume has exploded. This has mostly been due to a few CryptoKitties players valuing specific ‘fancies’ – the ones that were the earliest created. Axiom Zen marks the fancies in the order in which they were bred. The first created fancies of each type are suddenly being valued at significant amounts.

Players have sold the #1 fancy cats for over 20 ETH over the last two days – over $5000 per cat. This may seem like a far cry from its heyday. However, many ordinary players have participated in these fancy sales over the last few days. At least when it comes to the fancy market, CryptoKitties may just be bucking the broader crypto bear market.

Value in the Eyes of the Beholder

CryptoKitties has several dimensions of rarity for the cats. Collectors value different things in the cats, from generation to genes. Fancy cats have a unique appearance on the CryptoKitties app and are therefore valued higher by collectors.

Up until now, most of the fancy cats were valued based on generation and condition. A lower generation was usually valued higher, and cats in mint condition, i.e. cats that hadn’t bred, were valued higher. Over the last few days, however, collectors began swooping up lower numbered fancies irrespective of their generation and condition. Part of the reason may be due to a leader-board created at cryptokitties.city website, managed by a community member.

Whether the trend can last remains to be seen. For one, new fancy cats are minted at the discretion of Axiom Zen, and therefore there is no limit per se to the number of #1 fancies. This is unlike the fancy cats themselves that have a limit. For example, the rarest fancy cat in the game is Schrodinger Cat – only 73 of those exist and can ever be created.

There may also be a rebalancing of value within the game. Factors like generation and condition may once again become more important in valuing fancy cats. At the end of the day, however, cats are as valuable as collectors and speculators are willing to pay for them. If collectors value specific attributes more than others, the market will follow. Right now, it seems like that is lower numbered fancies.