The Innovators: Dapper Labs is developing blockchain’s lighter side

The Vancouver company foresees blockchain gaming unfolding in five phases.

Credit: Dapper Labs

Dapper Labs’ CryptoKitties merges digital currency with gaming

The Vancouver company foresees blockchain gaming unfolding in five phases

The esoteric world of blockchain and cryptocurrency got a much-needed dose of fun in late 2017, when Vancouver “venture studio” Axiom Zen launched CryptoKitties. Consumers quickly took to the first game on the Ethereum network, which lets players use digital currency to buy, sell and breed cats in billions of variations. By the following spring, a CryptoKitty had sold for US$140,000, the New York Times reported.

Axiom Zen soon spun off CryptoKitties into Dapper Labs, whose mission is to make blockchain products for real people. To that end, the company developed Flow, a blockchain built for the next generation of apps and games, along with the digital assets that fuel them. Unlike Ethereum and other networks, Dapper says, Flow lets developers create large-scale apps without sacrificing decentralization and composability, the power to speed up innovation by easily building on each other’s work. It’s also consumer-friendly.

Dapper has partnered with brands such as Warner Music Group and the National Basketball Association. Last fall, it opened NBA Top Shot, a peer-to-peer marketplace where fans can collect and trade highlights from their favourite teams and players. “We see blockchain-based games as key to creating digital ecosystems that give users ownership of their digital lives,” says co-founder and CEO Roham Gharegozlou, whose 80-plus-employee company has raised some US$51 million. Its investors include Silicon Valley venture capital firm Andreessen Horowitz, GV (formerly Google Ventures) and Samsung.

Dapper expects blockchain gaming to unfold in five phases. With crypto collectibles and art already thriving on Ethereum, the second wave will see many more collectible games like CryptoKitties join Flow, it predicts. Next: full games with collection loops, such as NBA Top Shot. The fourth phase is smart contract–driven games, “where the game itself is an open contract that anyone can co-create,” says Axiom Zen founding partner Gharegozlou. Unlike in traditional games,  purchased items won’t vanish with the app: “You buy an asset that you can form an emotional connection with because developers will build use cases for it, making user acquisition easier and broadening customers’ range of choices.”

And No. 5? “A fully open, fully on-chain metaverse is the last category and something we haven’t seen yet,” Gharegozlou says. “We think of it as the entire state of the blockchain available for any developer to build on, any individual to access, and where the assets can interact with each other and smart contracts can be built on top of each other. Because this is all software, we don’t think it’ll take 10 or even five years to get there, but I’ve always been optimistic.”