CryptoKitties, the wildly popular Ethereum app, has raised $12 million in a series A round, from venture capital firms including Andreessen Horowitz and Union Square Ventures. Axiom Zen is the company behind CryptoKitties and are looking to “make blockchain technology accessible and relevant to everyday consumers,”.
Andreessen Horowitz and Union Square Ventures were early investors in Facebook and Twitter respectively. Both VC firms have a stake in the U.S. cryptocurrency exchange Coinbase.
The investment shows belief in the Ethereum ecosystem as well as for the concept of ‘digital collectables’. Much of the mainstream press coverage of CryptoKitties launch on November 28th was negative due to the congestion it caused on the Ethereum network and the apparent absurdity of spending thousands of dollars for a virtual cat.
The $12 million investment from top VC firms is vindication for those who saw value in it from the games inception. Vitalik Buterin praised the game when it arrived, even amidst the high fees and congestion it was causing.
Fred Wilson the partner at Union Square Ventures wrote:
“At Union Square Venture, we think digital collectibles is one of many amazing things that blockchains enable that literally could not be done before this technology emerged,”
The Union Square Ventures website says that CryptoKitties are the “World’s first and most successful consumer blockchain product”. Fred Wilson, USV partner, was an early adopter of the game and had a collection of kitties within the game’s first week:
here is my collection. i would love a native mobile app (android of course) to manage my collection and buy more and breed. also a link to share out my collection. couldn't find that. (cc @aweissman ) pic.twitter.com/jSR44Eb78e
— Fred Wilson (@fredwilson) December 2, 2017
Aziom Zen has said that scaling the game will be a challenge if they are to achieve their goal of expanding the game to millions of users on a blockchain with a billion consumers.
Other investors include the Coinbase co-founder Fred Ehrsam, AngelList and Numaire founder Naval Ravikant and senior figures at Tinder, BitFury, Y Combinator and Digital Currency Group.