Next Steps for Cryptokitties

  • Commentary
  • June 20, 2020

Any literature on CryptoKitties, the iconic blockchain-based collectables game built on non-fungible token contracts, will almost inevitably include commentary on the project’s now infamous congestion of the Ethereum blockchain in late 2017. At the height of its popularity, CryptoKitties accounted for nearly 15% of all Ethereum transactions, crippling network latency and causing both transaction and ‘birthing’ fees to soar. Today, over two years after the incident made apparent Ethereum’s limitations in supporting NFT-based gaming dApps, Cryptokitties’ developer Dapper Labs is preparing to launch FLOW: a blockchain built largely for NFTs and with a particular emphasis on entertainment. With support from Warner Music Group and the NBA Players’ Association, the network implements several mechanisms intended to support usage and adoption by non-financial-centric users and developers. And while Dapper Labs has taken considerable steps to aid development efforts on the platform, including enabling the editing of smart contracts and the provision of a testing ‘playground’ for developers, questions remain regarding the ease by which popular entertainment dApps may transition or begin to operate on FLOW; in this same vein, FLOW’s lack of EVM-compatibility remains a concern given that many gaming dApps still operate on Ethereum and Tron, both of which run the EVM or derivations of it.

Alongside the launch of FLOW come efforts by Dapper Labs to revitalize its flagship dApp, CryptoKitties, whose on-chain elements will migrate from Ethereum to the new smart contract platform. From the player’s standpoint, upgrades noticeable in this second instantiation will include three-dimensional artwork and animations. Additionally, users may now introduce their Kitties to virtual environments with which they can interact. Important to consider, though, is that the majority of the users’ interactions with CryptoKitties occur within the off-chain dApp, which, among other functions, reads an NFT’s code and translates it into artwork, ‘cattributes,’ and other such interpretations. Thus, there appear no clear explanations as to why a change in the underlying blockchain is required to enable these upgrades. That said, while likely not directly responsible for facilitating such upgrades, FLOW’s architecture may indeed support a possible but unlikely increase in usage as a result of the potential popularity of the upgrades, and Dapper Labs’ vertical integration may lessen the resources required to ensure compatibility of these and future upgrades.

in the lead-up to the planned migration, Dapper Labs released limited edition Kitties designed by artist Momo Wang and distributed the Winklevoss-backed NFT marketplace, Nifty Gateway. The sale attracted over one hundred new users to the platform, resulting in technical difficulties and a noticeable slowdown. Though a significant spike in interest in CryptoKitties as of late, comparisons thereof to CryptoKitties’ 2017 slowdown of Ethereum currently being made are dubious at best and serve as no indication of an impending Cryptokitties comeback of December, 2017 proportions; Nifty Gateway is hardly analogous to Ethereum and the less than $50K raised on the former pales in comparison to the over $3MM in peak Cryptokitties transaction volume on the latter. There also remain a number of Momo Wang-illustrated Kitties that remain to be ‘discovered,’ a task which the Dapper Labs team has left users to “figure out the recipe [in order to] start breeding their own.” This ‘mystery’ is unmistakably reminiscent of Cryptokitties’ early genetic puzzles, which served as a quasi-interactive ‘gameplay’ element and, the Smith + Crown research team theorizes, were largely responsible for generating widespread excitement about the project.

Cryptokitties is undoubtedly deserving of recognition for its technical and executional achievements, as, regardless of waning value traded and Kitties bred, its architecture continues to serve as a blueprint for subsequent NFT-based games. That said, its initial and only notable usage and volume was fueled purely by speculative value and the aforementioned aspects of puzzle-based gameplay. The former has subsided such that newborn Kitties’ market value often fails to exceed their transaction and birthing costs; beyond prior expectations of price appreciation, Cryptokitties have never demonstrated any economic purpose, nor were they intended to. Cryptokitties’ inherent value—as a commercial entity and set of tokens—lies solely in the project’s ability to entertain. Yet the trail for NFT-based games blazed by Cryptokitties has produced projects such as Gods Unchained and Cheese Wizards, games whose entertainment value exceeds that of novelty or collectability. Thus, with regard to renewed relevance, Cryptokitties’s most promising path to revitalization is through the advancement of gameplay beyond breeding mysteries and previous such components. Indeed, Pokémon’s most recent gains in relevance arose not from newly designed cards nor from improved aesthetics, but rather the novel, interactive components seen in Pokémon Go. To have any hope of attaining similar results in terms of popularity, it is incumbent upon Dapper Labs to implement in Cryptokitties compelling, competitive gameplay mechanisms unseen in previous instantiations.