In yet another example of the internet folding in on itself, you can buy and sell “rare Pepes” using PepeCash, a cryptocurrency that ultimately relies on the Bitcoin blockchain. You know Pepe from a number of alt-right memes, like this one, and, terrifyingly — well, they’re all terrifying — this one.
These Pepes are part — possibly the first — of the recent fad of “cryptocollectibles,” one-of-a-kind “art” pieces that individuals can purchase and therefore own thanks to blockchain technology. If you’ve heard about this recently, it is because CryptoKitties, these goopy-eyed creatures, made a splash in early December by overwhelming the Ethereum blockchain because so many people wanted to own them. Overall, the idea behind CryptoKitties was to make cryptocurrencies/the blockchain approachable for those who aren’t crypto-savvy and bring true ownership back to a realm where it’s largely dissipated — the internet.
But instead of opening the opaque world of cryptocurrencies up to the crypto-illiterate masses, these strange, virtual collectibles may prove to be even more alienating by relying too much on internet culture to appear . . . appealing. Just take my editor’s response when I introduced him to the CryptoKitties website: “Oh. Ew!”
To be clear, the rare Pepes are not trying to appeal to the masses. However, other cryptocollectibles have spurred a lot of both digital and analog creativity from its users, all of which may prove more accessible than the collectibles themselves and may even result in increased adoption.
Since not everyone reading this has been eyeballs-deep in cryptocollectibles for the past couple of days, here’s a quick explainer on what they are and how they work. Blockchain is a technological innovation that lets people move digital items online, including money, in a secure and efficient way. Cryptocurrencies, decentralized currencies not attached to certain nations — the best known of which is Bitcoin, with Ethereum creeping up behind — rely on this technology. Cryptocollectibles like CryptoKitties are built on blockchain technology, and people can buy them using cryptocurrencies (usually Ethereum). Blockchain technology tracks where each CryptoKitty goes (aka, tracks ownership) and ensures that they cannot be duplicated.
Mack Flavelle, whose job title is “Instigator” at Axiom Zen, the studio where he and his team created CryptoKitties, told me that part of CryptoKitties’ mission is to get consumers to better understand blockchain technology through the game. CryptoKitties is, after all, a game, one people often compare to Pokémon. After you buy cats, you can trade them or breed them in an attempt to bring out more unique, and therefore valuable, traits. The priciest cat purchased so far sold for the equivalent of over $100,000 U.S. (around 250 in Ethereum then — the currency’s value changes constantly).
So far, some have used their CryptoKitties in ways that have affected the larger, non-blockchain-using public. In one strong humanitarian move, Nick Johnson, a London-based Ethereum software engineer who often writes about the cryptocurrency, sold his unique kitty for over $75,000 and donated the money to Heifer International, which brings livestock like cows to underserved rural communities. He wrote about the collaborative process that spurred this donation in a Hackernoon post titled, “How to turn 1 digital cat into 150 analogue cows.”
And then there’s WikiLeaks, which not only uses CryptoKitties to raise funds for its efforts but also donated Donald Trump- and Hillary Clinton-themed cats to the two of them, respectively. Should Trump accept the gift of “Trump’s Tender Tabby” (that’s the cat’s name), it will become “federal property to be enjoyed by future presidents via custodians at the US National Archives,” according to the WikiLeaks Shop. Wow.
The WikiLeaks Shop bred these cats after purchasing two Generation 0 CryptoKitties, named Mr. and Mrs. WikiLeaks, whose virtual copulation has led to other such cats as CIA Vault7 Kitty, NSA Spying Kitty, and Iraq War Kitty. While the Trump and Clinton cats troll political figures, these other cats aim to get WikiLeaks supporters “involved in learning about cryptocurrency,” described a Shop staff member who wished to remain anonymous.
This sounds similar to the goal Flavelle described for CryptoKitties, echoed in a blog post by another co-founder, Benny Giang, whose job title is “Bridge Builder” at Axiom Zen and “Fortune Cat” at CryptoKitties: “At the heart of this and all our blockchain efforts is a desire to make the technology accessible to everyone.”
CryptoKitties' creators initially derived inspiration from CryptoPunks, another type of collectible built on the Ethereum network. Launched in June 2017, CryptoPunks are 24-by-24-pixel graphics that look like this. Their creators, John Watkinson and Matt Hall of Larva Labs, initially offered them for free. They publicized them through “the usual places,” said Watkinson, like Reddit, and got a little bit of interest. Then Mashable wrote a story on CryptoPunks on June 16, several days after the launch, causing people to flock to get their hands on Punks they could call their own.
With only 10,000 CryptoPunks in existence, people claimed them quickly, increasing their value. “It wasn’t very long afterwards that someone had bid 10 ETH [Ethereum] on one of those aliens,” said Watkinson, whose email avatar is a cartoon version of himself, with glasses, brown hair, pale skin, and a kind-looking half smile. “At that time that was $3,000.” Much cheaper than today’s most valuable CryptoKitties, but nothing to scoff at.
“Those aliens” refers to the rarest type of CryptoPunk. Only nine of them exist. While most Punks look like humans, there are some zombies and even fewer apes. To Watkinson, they are simply art, except they’re much easier to trade than analog art (a phrase I never imagined using). “You don’t have to call Christie’s and list your CryptoPunk art,” he said. “Yeah, you don’t have this physical thing that you can hang on your wall or hold in your hands, but the fact that it’s this permanent digital asset . . . people will get used to that more as the sophistication of the whole platform improves.”
People have done whimsical things with their CryptoPunk art pieces, one man even turning his digital Punks analog by painting them, which he showcases on Twitter with the handle @cryptopunkart. It’s unclear whether he aims to sell these paintings (how meta), but Watkinson hypothesizes that he makes them “mostly to promote his own Punks” (even more meta). Another person collects CryptoPunks that resemble celebrities and fictional characters, also in a bid to up his Punks’ value.
Meanwhile, Flavelle of CryptoKitties said he’s talking to someone who wants to memorialize his recently passed friend who “loved crypto” with “an exclusive cat we give his family,” an endeavor the team is currently working on.
But at their core, all cryptocollectible projects are rooted deeply in internet culture. The name and spirit of CryptoPunks comes from cypherpunks, a name first given to an early ’90s group cum mailing list that focused on ideas like the intersection of cryptography, privacy technology, philosophy and computer science. (Oxford Living Dictionaries now defines “cypherpunk” as “a person who uses encryption when accessing a computer network in order to ensure privacy.”) And Flavelle’s “duh” attitude about using cats — “you should not explain why you’re using cats but why you’re not using cats” — to make a consumer product smacks of internet in-joking.
As for the future, collectibles like Punks and Kitties are essentially digitally immortal. “With this decentralized stuff, it runs without you, so it will run from now until whenever, because Ethereum keeps things going,” said Watkins, who is humble about his and Hall’s creation. What are the implications? No one I spoke to is really sure; Watkins says that the whole thing feels a lot like the early days of the web, with people “making silly websites,” the precursors to the very legitimate and serious sites that populate the web now.
On Jan. 13, the creators of several different cryptocollectibles, including Punks and Kitties, will meet up in New York, where they’ll talk about their work and where it’s headed. Perhaps this will result in more utilitarian uses for cryptocollectibles, or maybe other crypto-builders will create these down the line. As with the early internet, we’ll just have to wait and see if interest breaks out of nerdom and into the masses.
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