These adorable digital felines were around long before NFTs went mainstream — overwhelming the Ethereum blockchain when they launched in 2017.
What are CryptoKitties? Well, there’s a couple of answers.
At the most basic, CryptoKitties are blockchain-based collectibles — unique yet interactive pictures of cats that are part of a game designed to create more CryptoKitties.
It’s really fairly simple. CryptoKitties come in two sexes, sires and dames. They all have a unique, 256-bit “genome” that determines the 12 “cattributes” of an individual, among them the color of the eyes and fur, the pattern and colors of its coat, the shape of its mouth and eyes, as well its “purrstige” — a mark of its rarity.
Breed a pair and the game’s KittyOwnership smart contract will create a new CryptoKitty with attributes drawn from its parents’ genome by an algorithm. CryptoKitties can be rented for breeding or sold. And that’s pretty much it.
The Birth of NFTs?
Dapper Labs’ CryptoKitties game is basically where the NFT craze was born. That’s the craze that saw digital artist Mike Winkelmann — better known as Beeple — selling a collage of 5,000 of his works on a non-fungible token at Christie’s for more than $69 million million on March 11, 2021.
What makes CryptoKitties special — and valuable — is that they are built on non-fungible tokens, better known as NFTs. Non-fungible simply means that unlike Ether or other tokens using the ERC-20 standard, one token is not like every other. NFTs are built on a different standard, ERC-721, where each token is unique.
CryptoKitties were the first NFT collectables to become a broad hit. They were so popular when created that they effectively broke Ethereum — at one point accounting for 95% of all transactions on the blockchain — drowning out virtually all other DApps and sending the price of Ethereum’s gas transaction fees skyrocketing.
That turned out to foreshadow the No. 2 blockchain’s current problems handling the demands of the booming decentralized finance (DeFi) and NFT industries.
Thinking Big
In an even larger sense, CryptoKitties the game was the first Ethereum-based DApp aimed at a mass audience. Unveiled by venture studio Axiom Labs during a hackathon at the ETH Waterloo convention in October 2017 and launched the next month, CryptoKitties was soon spun off into a separate company, Dapper Labs.
“We launched CryptoKitties as an innovative and play-driven introduction to what blockchain can do and mean for consumers,” Dapper Labs’ CTO and ERC-721 standard creator Dieter Shirley told VentureBeat in 2018. “By engaging the community with fun and games, we reached much broader audiences.”
CryptoKitties also taught Dapper Labs “where the obstacles and opportunities are,” Shirley added.
It’s a lesson the company learned well, moving on to partner with professional basketball on NBA Top Shots in October 2020. These NFTs — called “Moments” — feature video clips of big shots and exciting moves minted on NFTs. They have seen more than $675 million in sales and resales, according to CryptoSlam.
Scarcity Sells
NonFungible.com, which tracks the NFT market, says CryptoKitties had been bought, sold and resold more than 2.8 million times as of the first week of August 2021, bringing in more than $40 million. Prices varied widely that week, ranging from $2.49 to $130,994.
That latter sale was for CryptoKitty #93, a Generation Zero NFT that was one of a special batch of 100 reserved for founders, making it particularly rare.
The Gen 0 CryptoKitties were minted rather than bred, and given away to start the game off. Just 50,000 of these will be created — there’s still a fair number unminted, making room for special collections, like the Artists Series — so they are the rarest and tend to be the most valuable. Since then, more generations are created as CryptoKitties of older generations are bred — so a pair of Gen 2 CryptoKitties would breed a Gen 3. CryptoKitties.co is up to Generation 45 on its marketplace.
Other marks of rarity include the cooldown period before CryptoKitties can breed again; limited runs like Exclusive CryptoKitties that were created for special purposes like charity auctions; Fancy Cats that are bred with special artwork; and mutations — or Mewtations — created in later-generation CryptoKitties and represented by gems, beginning with Diamond Mewtations.
That said, the top-selling CryptoKitty was a Gen 9 — Dragon (a.k.a. #896775), a violet and purple, chestnut-eyed, buck-toothed, dragon-tailed specimen with a raised eyebrow patterned after Star Trek’s Mr. Spock. Dragon sold in September 2018 for 600 ETH — more than $173,000 at the time — although it was far enough above what CryptoKitties were going for at the time that CNET speculated that it could have been an accident or money laundering.
Go With the Flow
Another lesson that Dapper Labs — and more or less everyone else on the Ethereum blockchain — learned from CryptoKitties was that Ethereum simply didn’t have the scalability to handle blockchain coming into its own. There have been a number of responses to this, ranging from Ethereum 2.0 to launching competing blockchains — the so-called “Ethereum-killers” like Binance Smart Chain, Polkadot and Cardano.
Dapper Labs went in this direction, building the Flow blockchain that is now used by CryptoKitties and NBA Top Shots, as well as other NFT collections including forthcoming ones from the UFC and Dr. Seuss.
Aside from speed, Flow brought a number of upgrades to CryptoKitties.
First of all, CryptoKitties is free to play on Flow, thanks to the elimination of Ethereum gas fees — which were often far more than the average-priced CryptoKitties themselves.
Then there’s the addition of 3D visuals and animation to CryptoKitties. This will affect not only new Flow-bred CryptoKitties, but also Ethereum-based specimens when ported over. And the two will be compatible for breeding.
Flow-based CryptoKitties will also be usable in other games built on Flow. Of course, that’s not unique to the new blockchain, as CryptoKitties have been usable in other games dating back to 2018’s KittyRace, as well as the more recent blockchain-based metaverse Decentraland.
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