The latest in crypto-world — people are going mad for CryptoKitties. It’s a popular application on Ethereum that lets players buy, sell, and breed cartoon kittens. CryptoKitties are one-of-a-kind Tamagotchi’s (digital pets, if you remember) that live on the Ethereum blockchain. One of these crypto kitties (the genesis kitty to be precise) traded for 247 ETH (around $110,000) last night! Why the hell are people paying 1000s of dollars (in crypto) for online kitties?
Remember that the blockchain enables “programmable scarcity”. This means that an asset on the blockchain is distinct and immutable and can’t be replicated. So, buying these kitties is like trading rare baseball cards. Those buying them think that the CryptoKitties may increase in value because each Kittie is unique and therefore scarce. And, of course, they’re also having fun breeding new kitties and nurturing them.
Often what looks like a toy to begin with can grow into something of serious value. Facebook began as a social network for college students to post photos and has grown into one of the most valuable companies in the world. So, I take this CryptoKitties frivolity as a good sign (and an indication of crypto millionaires diversifying.) I actually wrote in my last post that a gaming application might be the next killer blockchain application.
CryptoKitties also got me thinking... How long until one-of-a-kind digital art, imagined in wholly new mediums, is sold through the blockchain? Wouldn’t it be awesome if artists started to benefit from the blockchain’s capabilities just as technologists and financiers have? I tell you what will be a crazy milestone: the first one-of-a-kind piece of digital art that sells for a million dollars.