Over the last few weeks CryptoKitties has become a minor sensation. As of December 20th, more than $1.7mm USD worth of ether has traded hands in pursuit of collectible, breedable, digital cats. A few days after release, about 11% of the ethereum network’s capacity was being used by CryptoKitties.
We’ve seen similar apps before. This past summer, Larva Labs released Cryptopunks, a project that gained minor fame within the ethereum community, and maintains a passionate community of people who trade them and even create real-world art based on them. Even more projects are following in this path soon, like CryptoPets and CryptoPuppies.
It’s clear that at least some people really love the idea of blockchain-based digital collectibles. For people already interested in collectibles, the appeal is obvious. Before now, digital collectibles existed only inside walled gardens like Steam or apps like Quidd. But CryptoKitties and Cryptopunks are open, and your ownership over them isn’t totally dependent on the whims of someone else’s platform. They can be traded on open markets, where you can even turn a profit if you’re clever.
They’re digital objects that are starting to feel more like real objects — things that you have total control over, that you can sell whenever you want for real money, and that you can lose if you’re not careful. The reaction to CryptoKitties suggests to us that these kinds of digital objects have struck a nerve, and that there will be many more like them.
Today, we’re eager to begin an experiment by releasing the alpha version of Digibles, a universal wallet and creator for digital collectibles. With digibles you can:
- Hold and trade your Cryptokitties & Cryptopunks
- Create and issue your own digital collectibles using the ERC 721 standard, the same standard used by Cryptokitties.
- Hold and sell any digital collectibles that use the ERC 721 standard.
Digibles is in alpha, which means you should — as always! — be careful with the amount of funds you put into it. This is experimental software that is not yet considered stable or safe for valuable digital assets.
Digital collectibles: something people actually want
In a famous essay on startup product ideas, Paul Graham wrote:
Don’t be discouraged if what you produce initially is something other people dismiss as a toy. In fact, that’s a good sign. That’s probably why everyone else has been overlooking the idea. The first microcomputers were dismissed as toys. And the first planes, and the first cars. At this point, when someone comes to us with something that users like but that we could envision forum trolls dismissing as a toy, it makes us especially likely to invest.
Blockchain-based digital collectibles will someday be added to that list of products that were initially dismissed as toys, but turned out to have much greater significance.
People love collecting things. We spend billions of dollars on collectibles every year, ranging from autographs, to classic cars, to toys, to trading cards. It’s not like this is some new, strange behaviour that we’re struggling to figure out — it’s a well understood consumer market.
Even digital collectibles are fairly established at this point. In 2017, digital collectible card games earned $1.7 billion. Video game publishers and creators earn billions more by selling in-game items and collectibles.
Blockchain-based digital collectibles aren’t some weird, unique thing that only cryptocurrency fans care about— they’re a new variation on something that a huge population of humans care about.
In some important ways, they’re better than all other digital collectibles. It matters that they exist on an open network, using open standards, and are interoperable with anyone who supports those standards.
It means that once you own something, you really own it — if the company that built it disappears or goes bankrupt, you still own your digital collectible. It means that anyone can build on top of digital collectibles made by other people, integrating them into their own applications in creative ways.
Our weird collectible future
Let’s think through some ways that open tools like Digibles can enable an increasingly strange world of digital collectibles:
- Games that adopt open standards like ERC 721 for in-game items
Imagine hundreds of games — digital card games, strategy games, RPGs, sports games — that all adopt the ERC 721 standard for in-game items. Items you earn in-game can be sold and bought on open markets in exchange for cryptocurrency, and can be used in other games that support them. A powerful item you earn in one MMORPG can be transferred to your inventory in another game, so long as the developers of the second game choose to support it.
Imagine that you’re a game developer about to release a new RPG. You decide that the audience for a popular FPS might really like your game, too. To draw people into trying your RPG, you offer the players of the FPS a really good exchange rate or special bonuses when they bring their FPS items into the RPG. Maybe a group of games all decide to share a common set of in-game items, or a shared currency, to benefit from the network effects of giving players more to do with their “money”.
Big developers might not like this. They probably prefer their walled gardens, where they can extract large fees. But to indie developers, it could be a powerful tool — a way to bootstrap your game’s network effects and incentivize a ready audience to try your work.
2. A new open world of achievements, badges, and other meaningful digital “proofs”
Today there are dozens of platforms that issue achievements or badges, like foursquare, xbox live, habitica, or duolingo. But once you have them, they only live inside the app. If the app disappears (and most do), your badges are gone, and you can only really show them or use them inside the app itself.
Imagine that anyone — any app, person, company, shop, sports team, artist, etc — can issue achievements or badges. Imagine that they all use an open standard, and attach to a digital ID that you control yourself (including controlling which badges to show to which people).
You buy the first CD of an artist you like, and get a digital badge that proves you liked them before they were popular. You get 2,000 retweets, and you get a badge proving it. You donate to charity, and you get a badge that you hold forever. All of these attached to a digital ID — your private keys — that you have control over.
You might not personally care about the examples above. But collecting proof of the things that we find meaningful is a human universal, and we’d prefer a world where these are done with open standards and sovereign ID rather than through someone else’s proprietary application.
3. Anyone, anywhere, can create digital collectibles and badges with free open source tools.
Today, creating meaningful digital collectibles or badges is hard. The walled-gardens they live inside need to be big enough for people to care about them. The reason people care about steam collectibles or twitter follower counts is that these platforms are massive enough to have social network effects.
But digital collectibles built on open standards get some of those network effects for free. They’re instantly tradable alongside all other collectibles, and anyone can build them into their own application. They’re instantly compatible with the tools — wallets that hold private keys — that millions of people already use.
What’s more, the tools to create them will be open and free. Anyone — indie game developers, artists, musicians, youtube celebrities, weird twitter accounts — can experiment with them. Eventually these will move beyond imitations of existing forms of “collectibles”, spawning new unexpected markets for speculation and creativity.
So: help us answer that question by trying out Digibles. Make something weird, and try to sell it. Make something fun, and give it away for free. Or just make something, and figure the rest out later.