By Victor Agreda
CryptoKitties has achieved mainstream awareness, as evidenced by this recent NPR story. At the root of CryptoKitties are non-fungible items (using ERC721), a still relatively new category for blockchain. At Token III, Nick Tomaino of 1confirmation moderated a panel of experts on NFTs and their implementation and future. The panel consisted of David Pekar (Rare Bits), Devin Finzer (OpenSea), and James Ferguson (Etherbots).
Pekar is a particularly knowledgeable guest, as his work on Farmville gives him a background on working with in-game items. He zeroes right in on his main point: digital goods sold on the blockchain are fundamentally better for consumers because it gives them more control, more ownership, and more autonomy over their digital property. Since Pekar worked in the game industry for a decade, he notes that clones of CryptoKitties are thin on game mechanics and will likely fizzle out in favor of games that are actually better games overall, and blockchain just happens to be the underlying tech.
You may have heard of Ferguson’s project, Etherbots. Earlier this year Etherbots pre-sold robot “parts” for the game and sold out three days early, with players buying over $1,000,000 USD worth of parts, the most successful game pre-sale to date. When asked about the pre-sale, he makes the point that when online games kick off, you need to have a number of players already invested in the game so new players don’t feel like no one is playing. With Etherbots, they looked at the popular “thin mechanics” of either grading/rating or “hot potato” games and wanted to do something different. Going forward, he’s looking forward to services and other games built on top of things like Etherbots. Games built on games, due to the nature of NFTs and the properties they will carry across different services or games.
Tomaino builds on that to say larger game companies could copy the pre-sale model for NFTs and raise large sums and bootstrap with a large community built-in. He’s also waiting for one of the bigger game studios to jump in with a AAA title — immersive, 3D experiences like Grand Theft Auto or Fallout that bigger budgets can create.
Devin Finzer mentions Decentraland, which is is a virtual reality platform powered by the Ethereum blockchain, that sold land in a pre-sale which ended up totaling around $10 million. He points out that these models are still being developed and haven’t necessarily proven themselves, including Etherbots. When they do, that’s when larger game publishers will jump into pre-sales.
Looking forward, Finzer talks about the success of CryptoKitties and why it’s a good model going forward. CryptoKitties allowed others to build on it, so games like KittyHats — giving you accessories for the virtual cats in CryptoKitties — were possible. By allowing an open-ended nature for games, and making the logic accessible, it leverages some of the unique features of the blockchain to create compelling experiences that can develop over time.
Pekar takes a bit of a different angle, saying blockchain enables a few unique elements that can be incorporated into games: scarcity, ownership, a market, and transparency. Some of the games that come to mind leveraging those attributes? Games involving social coordination and trading, consumption of (scarce) resources, and some existing mechanics of popular games that could be fit into the blockchain model.
Each panelist also gives their take on how to scale their Dapps. Ferguson mentions side chains and state channels. Those, plus proof of stake work being done on Ethereum, could be one approach to managing scalability. Meanwhile, Pekar is keeping his options open, saying that Rare Bits isn’t an Ethereum company and will be blockchain agnostic when it comes to solutions. Finzer says looking at the stack from layer two upwards is how most games are dealing with scale, sometimes generating hybrid solutions (centralized and decentralized).
Lastly, each panelist talked about what they’re excited about coming down the pipeline, and Pekar kicks things off by mentioning great content. That’s not surprising coming from someone who worked on Farmville and knows how good games work. But he’s also excited about digital goods in general, and the potential to draw in larger audiences. One product coming soon: Fanbits, which allows existing YouTubers and similar content creators to make digital goods for their audiences. Finzer says he believes new game mechanics will inevitably bring in more consumers. OpenSea, for its part, is looking at how to bring the most liquidity to the space. Ferguson wraps things up accurately pointing out that most gamers are digital natives, and willing to try new tech and digital assets are normal to them. The next stage will be bringing up the quality in the games themselves to match expectations of players.
Featured Image, Romanian Stamps Postcard, via Flickr