GamesBeat Summit: CryptoKitties’ Giang answers ICO questions, gives primer on blockchain gaming using cats

Last Updated on February 23, 2024 10:01 am by Martine Paris

Amidst an intimate gathering of industry luminaries, tucked away in a tiny breakout session at GamesBeat Summit earlier this week, CryptoKitties Founder and Fortune Cat, Benny Giang, discussed gaming on the blockchain, the value proposition of owning cats as digital assets, and answered questions about doing an ICO for the hyperpopular Ethereum game.

He explained, “Last year there were three big headlines: bitcoin price, hacks, and scams in ICOs. The answer to that was to put cats onto the blockchain, make it accessible, make it fun and don’t do an ICO. That was our strategy for it, haha. We still think ICOs are a great funding mechanism but we wanted to prove it’s possible to build a game with an interesting mechanic that can be profitable.”

“There are five layers to implementing blockchain to a game and the further you go the more you need to discuss scalability.

1. At the top, the first layer is just a normal game

2. Second one, you’re starting to see the secondary markets like WAX and dmarket, where there’s a centralized gaming asset, whether it’s a CS:GO skin or League of Legends hero and they stake it to a token and you can sell it

3. Third one (involves) swapping out the virtual coins in the game into a crypto-token and you’re starting to see these platforms where you can ICO your game and raise funds as an indie developer where they’re just swapping out the tokens with cryptotokens

4. Fourth one is an item, so they have items like a sword or gold but it’s essentially an ERC20 token which is essentially a fungible token. If I have $5 and I give you $5, it doesn’t matter what bill we have. That’s kind of the 4th layer. You’re seeing these people putting these items, or exploring digital items, in the game space.

5. Fifth one which I think is the most interesting, is that each of the individual items of the game, which are the CryptoKitties, are not fungible. Best way to think about it is like a house or car. We can’t easily trade houses. There are different values associated, so that itself requires a lot more competition. But not only that, every single action of this nonfungible token is recorded on the blockchain, that’s when we need to discuss the scalability question.”

Giang continued, “Our cats live without servers. They can live for thousands of years, even if we go bankrupt or we all die of all old age, the kitties will continue to exist, and hopefully there’s no forking or there are people still running the Ethereum node, the cats will live forever. What we’ve done is just put 610,000 cats onto the blockchain, and more to come, and the really cool thing is actually looking back at history and a thousand years in the future, someone can go back and say 900 years ago someone bought this cat, or 800 years ago someone fed this cat, and as technology gets better with AR/VR, these tokens that you hold in your wallet which is a cat, you can visualize it using virtual reality. And really it blurs the lines. One thing that I’ve realized is that virtual reality, augmented reality, or mixed reality, all of them have the word reality but nothing in these virtual worlds are actual reality. So when we start to see these digital cats that will exist in a Pokemon Go style, and is something that you truly own as a digital asset, and the things that you do depending on how the game producers decide, should we put the “feeding the cat” as a smart contract on the blockchain, there are things that come into consideration when we start treating these cats as digital assets.”

“We had 6-7 people pay $100,000 USD for cats and people are like it’s a 2D image. I can make this 2D image. But if you look at the fundamentals, it is a token that is unique to you, and the metadata is there and the actions of these in terms of breeding and selling and buying are on the blockchain, as the technologies progress we have games like this, we have others games, then you start recording all of that into your history.”

Fascinating session was moderated by Block Bits Capital Japheth Dillman.