The blockchain gaming craze has dried up in China
China’s tech giants launched crypto pets games in the vein of CryptoKitties, but they no longer exist after burning investors
Chinese tech companies were quick to capitalize on the trend, but the biggest games wouldn’t last long. Many players who sunk their hard-earned cash into collecting digital pets got burned when the bubble popped.
At its peak, the hype drove thousands like Mr. Dong to invest in cryptocurrencies and blockchain-based projects. The technology, based around a tamper-proof distributed ledger, found its way into every industry imaginable, including gaming.
But how would a virtual pet have any value at all?
“The early buyers of these kittens actually thought they would get rich, that was what spurred the actual bubble,” said David Johansson, founder and CEO of Shanghai-based blockchain gaming company Blocklords. “It was very hard to recover from that.”
When the crypto frenzy took off, China became a hotbed of blockchain- and cryptocurrency-related companies. This led Chinese authorities to ban initial coin offerings and cryptocurrency trading. But the ban didn’t affect other blockchain projects. So many companies jumped on the crypto pets trend, with some of the country’s biggest tech companies joining in.
None of these games exist today.
“In general, I think these Chinese companies wanted to capture some of the ‘buzz’ surrounding blockchain based collectibles,” said Ian Wittkopp, vice president at Sino Global Capital. “It was great marketing!”
Some of these games were launched as an experiment, as Xiaomi said was the case for its collectible bunny game Jiamitu. Others tried to use cute crypto pets as a gateway to other services.
But these games, which are no longer online, couldn’t have been interesting enough to hold players’ attention. Even CryptoKitties, which still exists, only gives players three options: Breed cats, buy cats and sell cats.
“This is a problem with blockchain games overall. They require you to spend [money on] something that is really not that fun,” said Johansson.
One potential use of blockchain is for trading virtual items such as weapons and armor. The advantage is that blockchain makes ownership of unique items traceable, which would be good for trading between players. Another use for blockchain, according to Wittkopp, could be in games of chance or collectible games.
However, using cryptocurrencies to buy and sell items can still be daunting for normal players, and blockchains need to become faster, Johansson noted. The integrity of a blockchain relies on some heavy computation, which can require a lot of power and time.
“If you ask me if blockchain games are going to be popular with the standard gamer now, I'd say no, because it's not possible and the technology is not ready,” Johansson said. “In the future, the player shouldn't even know they're playing a blockchain game.”