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How the Ethereum blockchain could be used to verify sports memorabilia

Daniel Roberts
Senior Writer

A kitten-breeding game for the Ethereum blockchain has driven people to spend more than $19 million USD since the game launched in November.

CryptoKitties, in which users pay in ether (the token of Ethereum) to breed and trade unique digital kittens a la trading cards, may sound like a trifle. But Nolan Bauerle, director of research for the bitcoin and blockchain news site CoinDesk, says the game demonstrates Ethereum’s serious potential business applications.

“It’s the extension of that anti-counterfeit quality of all of these coins,” Bauerle said last week at the Yahoo Finance All Markets Summit on cryptocurrency.

CoinDesk research director Nolan Bauerle (R) speaks to Yahoo Finance’s Dan Roberts at the Yahoo Finance All Markets Summit: Crypto on Feb. 7, 2018. The homepage of the Ethereum game CryptoKitties shows on screen. (Gino DePinto/Oath)

Indeed, the bitcoin blockchain, Ethereum, and other public blockchains are immutable, meaning that transactions are recorded permanently on the chain and cannot be altered, duplicated, or lost. Thus every digital kitten bred in CryptoKitties, as the game promises on its homepage, “cannot be replicated, taken away, or destroyed.”

And that’s where CryptoKitties can be applied to other business cases.

“Because they have this counterfeit protection, you can actually apply that to memorabilia,” said Bauerle. “So this is really the beginning of what we’re going to see—I think, anyway—for sports memorabilia, for the authentication of game-worn jerseys, and cards, and all kinds of other stuff. So it’s an important initial step in a use case that is only just getting to the point where people can deploy it commercially.”

Of course, you can apply Bauerle’s point to any item that relies on authentication to assure its value, such as fine art or celebrity autographs.

More than 500,000 unique CryptoKitties have been created and more than 38,000 ETH has been spent on breeding and trading them, according to a page that tracks CryptoKitties data. In some cases, more than $80,000 USD has been spent on a single CryptoKitty.

The game became so popular that it drove the Ethereum blockchain to all-time-high activity levels, and clogged the network.

For now, CryptoKitties is the most prominent use case of Ethereum; some have mocked that fact. But if a mindless digital kitten game can lead people to spend millions of dollars, it could indeed end up “bringing the first billion consumers to the blockchain,” one of the game’s stated goals.

How soon, then, can we expect a mainstream retail use case for Ethereum beyond birthing digital kittens?

“Because we are dealing with that whole collectibles industry, I think it’ll just take an entrepreneurial group to go ahead and do it,” says Bauerle. “I imagine we’ll start seeing a lot more of that in the near future.”

Daniel Roberts covers bitcoin and blockchain at Yahoo Finance. Follow him on Twitter at @readDanwrite.

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