CryptoKitties is a new Ethereum-powered game centered around collectible cats, which became a commercial hit as thousands of “cats” have been sold grossing more than 5 million dollars in revenue so far. The side effect was that the Ethereum network has been congested hitting all-time highs in transactions.
First of all what is CryptoKitties. Well, CryptoKitties are cryptocollectibles, which means you can buy, sell or trade each CryptoKitty like a traditional collectible and be sure that the Ethereum blockchain will track ownership. For the uninitiated, each CryptoKitty is simply a unique cat picture which is 100% owned by somebody. But thanks to the blockchain, the kitty cannot be replicated, taken away, or destroyed. It is... immortal and has a value which is set by the market.
How Do you play Cryptokitties?
To play CryptoKitties all you need is a computer running Firefox or Chrome, a digital wallet browser plugin called Metamask which supports CryptoKitties among lots of other Dapps and of course Ether (ETH) to buy your first kitties.
US citizens having a Coinbase account can buy ETH inside Metamask using the Coinbase widget. The rest can only acquire Ether from an exchange and then transfer it to their Metamask wallet.
How Much A CryptoKitty Cost?
Well, there is no fixed value because, as mentioned earlier, Cryptokitties are collectibles. This means everyone can buy and sell a CryptoKitty at an auction. The owner of a kitty sets a starting price which goes down until the auction ends or another user purchases it. Of course, we need some initial kitties to get things started.
Enter Gen 0 Kitties
The game gives birth to a new CryptoKitty every fifteen minutes. Its price is determined by the average price of the last five Cryptokitties sold plus 50%. These parentless kitties created by the game automatically are called “Gen 0” and will continue to pop up until November 2018. At that point, the game creators will stop creating new kitties and the only way to get your first CryptoKitty will be to buy one from a user in the marketplace. Note that the game creators take 3,75% from every marketplace transaction.
For reference here’s the first Gen 0 cat ever born aptly named Genesis
Genesis was sold for $117,712 in an auction on December 2.
Breeding And Siring
But here’s where the fun (and possibly the money-making) starts. The novel thing about Cryptokitties is that they are... breedable. This means if you have two CryptoKitties you can breed them to create a brand-new, genetically unique offspring.
And you don’t even have to worry whether your kitties are boys or girls. Cryptokitties are bisexual; they can play the role of Dame (mother) or Sire (father) without a... meaw. Once you choose which CryptoKitty will play the Sire role (father) and which will be the Dame (mother), you’ re set. Approve the Ether transaction (yes you pay for it) to start the breed process and you should expect a new Kitty soon.
You can also breed your kitty with another user’s. That’s called “siring” inside the game. You just go to the Siring section of the marketplace, pick one of the hundreds of cats waiting to be the “Sire” in a breeding process and then click Breed now. Then you select one of your kitties to be the mom. Once you approve the transaction, a new kitty will appear in your Cryptokitties collection.
No matter how you choose to create new cats, breeding or siring, you will get a new unique CryptoKitty with special looks. Yes, each cat has some kind of gene scheme which affect not only its looks but also that of its offspring. In game lingo this is “a probabilistically unique genetic combination that affects not only what it looks like, but what its offspring look like.”
Famous Cat Or I Want My Cat To Look Like Elon Musk
The game developers (AxiomZen) not only added genes in their cats but also allowed certain ascensions (new characteristics emerging from breeding two cats) to unlock Fancy Cats. These Fancy Cats are super special kind of kitties with custom art resembling real people, more specifically famous ones. This allows cats like Feline Musk or Kitty Perry. But there’s a catch: you need to hunt for the proper characteristics that need to be mixed together to result in a new Fancy Cat. And that might “take a few tries to get the offspring you’re after”
How Do Game Developers Make Money?
The developers of the game make money from the Gen 0 cats. Every time such a cat is sold, they take the full revenue. As mentioned, Gen 0 cats do not have a fixed price but their price is pegged to the average price of the last 5 Cryptokitties sold. Given the fact that they will be creating Gen 0 cats every 15 minutes for almost a year from now, you get the picture.
Network Congestion Doubles The Kitties Birthing Fee
The CryptoKitties game became so popular in recent days that resulted in record breaking Ethereum transactions in a single day. On December 4, the Ethereum network validated more than 701,000 transactions as the chart below shows (source: Etherscan.io):
And quite a lot of all Ethereum traffic was CryptoKitties transactions. This led to congestion which prompted the game developers to double the birthing fee on December 3 ( from 0.001 ETH to 0.002 ETH ) thereby increasing the miner incentive to add birthing transactions to the blockchain.
🚨🚨🚨🚨 Due to network congestion, we are increasing the birthing fee from 0.001 ETH to 0.002 ETH. This will ensure your kittens are born on time! The extra is needed to incentivize miners to add birthing txs to the chain. Long-term solution will be explored very soon! 🚨🚨🚨🚨— CryptoKitties (谜恋猫) (@CryptoKitties) December 3, 2017
But that did not solve the problem. Thousands of transactions were pending thus the developers increased the fee again yesterday to 0,015 ETH.
🔥🔥🔥 DUE TO CONGESTION ON THE NETWORK WE ARE INCREASING THE BIRTHING FEE FROM 0.002 ETH --> 0.015 ETH. WE HOPE THIS WILL ALLOW MORE KITTENS TO BE BORN ON TIME AS THERE HAVE BEEN SIGNIFICANT DELAYS 🔥🔥🔥— CryptoKitties (谜恋猫) (@CryptoKitties) December 4, 2017
Some Ethereum users did not like much the CryptoKitties craze (and the resulting network congestion), but Ethereum’s creator seems to like it as a “value of blockchain” experiment:
I actually like the digital cat games. They illustrate very well that the value of a blockchain extends far beyond applications that would literally get shut down by banks or governments if they did not use one. https://t.co/AtcdjkrlB3— Vitalik "Not giving away ETH" Buterin (@VitalikButerin) December 4, 2017
Whatever the case, CryptoKitties is the first solid proof that blockchain can give birth to and host really unique online games. More than 80,000 unique cats have been already generated either from the game (Gen 0) or from breeding/siring. And more than 31,000 of them have been sold to somebody with an average sale price of $126 dollars (median at $23) per kitty. On Monday December 4, the game boasted that it had acquired more than 27,000 registered users generating 25% of Ethereum network traffic during the last weekend.
If you love crunching numbers, there’s an app that tracks CryptoKitty Sales. Here’s the highest priced kitties according to that app:
What's your take on CryptoKitties? Would you buy and start breeding your own Cats or you think it is a dumb game?