What’s Next For Cryptokitties?

Originally posted at: https://medium.com/@ianedws/whats-next-for-cryptokitties-7ec7368a4b10

Has the high point of Cryptokitties’ popularity come and gone? Released on the 28th of November by Canadian startup studio Axiom Zen, it became the biggest blockchain game ever released in terms of players and revenue. The New York Times wrote that by the end of December, 180,000 people had signed up for Cryptokitties and spent about $20 million USD in ether. Many were surprised at the sums people were willing to pay for the early cats, with hundreds having sold above $10,000 USD, and at least five selling for more than $100,000, according to kittysales.co.

Cryptokitties definitely started off with a bang. But since then, the price and usage trends are all down. According to kittyexplorer.com, median cat sales prices have declined precipitously. On December 4th, 2017, the median cat on cryptokitties.co sold for .088 ether, or about $41 USD. On January 2nd, 2018, the median kitty went for .008 ether, or $7 USD. This calculation takes into account the increase in value of ethereum from $470 USD to $884 USD during that period.

Other metrics show the same downward trend. Sales per day are down from a high of 16,993 cats on December 10th, to 2,206 on January 2nd.

Volume of ethereum used is down from 4,833 on December 4th to 82.5 on January 2nd.

And the number of new cats being created has declined from 31,642 cats produced on December 10th to 3919 on January 2nd.

End of an Era

Just because these metrics are down doesn’t mean that Cryptokitties has failed. Certainly, people are still buying, selling and creating cryptokitties every day. But the lofty heights in terms of sales and volume appear to be in the past. Part of the reason for the early popularity of Cryptokitties was due to the fact that some players were trying to breed cats for profit.

The San Francisco Chronicle did a profile of someone who did just that. Starting with a $75 USD investment, Russ Smith ended up selling his cats for $2,000 over the first three days of December. Though this many have been possible in the first week or two after the release, this strategy is now mainly defunct, as the birthing fee of .008 ether, or $7.50 USD, costs more than the value of at least half the cats for sale on the market.

The cheapest cat currently sells for .002 ether, or $1.87 USD. And transaction fees have stayed the same as well; trading a cat costs around $4 USD.

But not everyone is playing Cryptokitties with the goal of making money. Most likely just want to try out the latest blockchain app and spend some of the ether sitting in their wallets. Buying a cryptokitty was always a speculative move and most who did were early adopters, willing to pay in order to be on the cutting edge of crypto.

A Positive for the Crypto Space

Whether people will continue to collect cats and pay the creation fees purely for the fun of it remains to be seen. But even if they don’t, Cryptokitties can still be qualified as a success. Axiom Zen and their design team executed well in creating a game that took steps towards making Ethereum consumer friendly. Benny Giang of Axiom Zen said that blockchain is still difficult to use for the average consumer, but that the company’s goal was to “to make our game as accessible as possible.”

Because of Cryptokitties, we now know that the potential for a successful blockchain game exists. And we also know that blockchain apps have a long way to go, as the problems in getting transactions though Ethereum’s often overloaded network showed. But, thanks to Cryptokitties, cryptocurrencies became more fun and well known to the public. It’s likely that Axiom Zen, or another company, will make another attempt at a blockchain game in 2018. But trying to accurately guess what the next development will be is a fool’s errand, as Cryptokitties, and the crypto space more generally, are still projects under heavy construction.