Blockchain Explained in a Playful Way

July 13, 2021

CryptoKitties are more than just a game

CryptoKitties are more than just a bizarre online game. Even though the true fascination for the virtual kittens - for which people are ready to pay as much as 100,000 Euros - only reveals itself to the die-hard fans, they are excellently suited to playfully explain to an audience of laypersons what blockchain and crypto currencies are all about. Prof. Alfred Taudes, Head of the Research Institute for Cryptoeconomics at WU, speaks about why CryptoKitties are important for blockchain’s development, the need for more transparency in virtual markets and how Vienna boasts the world's largest blockchain competence center.

Picture of a CryptoKitty
CryptoKitties explain blockchain and crypto currency in a playful way. Photo ©

The differently colored kittens look extremely cute and blink at us friendly – these are CryptoKitties. Yet, we can’t buy them in a pet shop because they are a very special species. The virtual cats are part of the online game of the same name (, which is a perfect example for an unusual use of a crypto currency. To buy the kitties you need Ether, the currency of the Ethereum blockchain; and that’s why CryptoKitties are also an excellent demonstration of special technological features.

Like Arabian Horses, But Virtual

The virtual kittens can be bought and sold. Prices depend on what buyers are willing to spend on special breeds. Each cat is unique; two of them can reproduce digitally, so that the chances of selling the offspring of coveted breeds at a high price are particularly high. "You have to imagine the whole thing as the breeding of Arabian racehorses, but virtual. For some time, the game was so popular that up to 100,000 Euros were paid for individual cats and the transaction volume put the response time and throughput of the Ethereum network to a tough test," said Prof. Alfred Taudes, Academic Director of the Research Institute for Cryptoeconomics at WU.

Picture of several CryptoKitties
Virtual breeding: some CryptoKitties were highly coveted and therefore sold for 100,000 Euro! Photo ©

In the meantime, the hype has somewhat subsided, but CryptoKitties' important impact on the development of the blockchain should not be underestimated. "The concept is so interesting because it is one of the first non-fungible tokens of the blockchain," Taudes continues. Fungible goods, on the one hand, are comparable with other goods of their kind and can therefore be replaced. The euro, for example, is fungible, like Bitcoin. On the other hand, artwork or real estate are not fungible, because every object is valued differently. The game resembles a decentralized market where artificial cats are traded and bred. "It is always clear who owns the individual cat; the game is completely transparent and cheating is not possible", explains Taudes.

Decentralized Platforms Without Intermediaries

If you are not interested in the CryptoKitties, you should still see the game as a great example for future applications of the blockchain. A blockchain is basically a distributed database that enables encrypted data storage and secure transactions of data. "On the art market, artists are often financially disadvantaged because only dealers make a lot of money on the trade." Yet people can now use blockchain to build new, decentralized platforms, where nobody can put him or herself between the buyer and the seller. "Large platforms like Spotify, where artists have little choice, could become unnecessary." It's the same with CryptoKitties: Since a CryptoKitty is a token, you can also exchange CryptoKitties directly over the Ethereum network without using the CryptoKitties website. However, it will still take some time until these projects can prove themselves in practice, especially since users need a certain understanding of crypto currencies. Currently, however, Ether, Bitcoin & Co. are less popular, as their value has fallen sharply in recent months.

Portrait Alfred Taudes

Prof. Alfred Taudes

  • Head of the Research Institute for Cryptoeconomics

It was clear that there had to be a correction. One of the reasons for this was that applications based on crypto currencies have not yet been able to establish themselves on a larger scale. But there's something positive about it, too: if the most common tokens are cheaper, it fosters the development in the future.

Vienna and the Austrian Blockchain Center

By the way, the Austrian capital is about to play a decisive role in the further development of the blockchain technology. The world's largest blockchain competence center is currently being built in Vienna. The Austrian Blockchain Center (ABC) will bundle interdisciplinary competences in this field, Prof. Alfred Taudes is coordinator and scientific director of the initiative. "We hope to become one of the hotspots of the blockchain community worldwide." The involvement of universities, businesses and other partners could lead to a "critical mass" that is important for projects in this area. Europe has the best prospects here with blockchain, says Taudes. "In this area, Silicon Valley is on the defensive."

Blockchain is also a topic of the short program "Data Science". For more information, please click here.

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