One year ago I felt uncertain about the future. I know because I wrote about it here.
The era of mobile internet was ending. The decade gave us causal gaming, on-demand services and chat. The successful strategy had been to bet on apps with network effects. But the next wave wasn’t obvious.
Going into 2018, my uncertainty is fading, and I start sensing the contour of the next decade. And it is cute kittens.
In October, the first version of the game Cryptokitties was released. People breeding and trading digital cats. It became an instant success. Its demise will be equally swift. But something important will linger.
Cryptokitties paves the way for something truly groundbreaking. The assignment and trading of unique digital assets.
Bitcoin had long proved blockchain’s ability to assign and trade ownership over digital assets. But until October this year, the digital assets were fungible. Meaning my coin is no different from your coin. This property makes Bitcoin suitable as money. The thing is we already got money.
In contrast, we never really had unique digital assets. But we do now. And that matters because value stems from two properties. The first property is scarcity. The second property is uniqueness.
Bitcoin solved the scarcity problem. But the coins had no meaningful differentiation. Like oil, gold, and energy.
But the underlying blockchain to Cryptokitties added uniqueness as a property. Like art, companies, contracts, and land.
Uniqueness is immensely important because people are different. We like and need different things at different times. A rental contract might be favorable for one person but useless for someone else. A remix of a song might be enjoyed by one person, but disliked by another.
Furthermore, we are creative beings and we like to personalize our world. We develop recipes, produce art, write software and record tutorials.
The smartphone made it easy to create. In 2018, the innovations in blockchain technology will make it easy to own and sell whatever you create.
The combination will complete the economic ecosystem for digital products. The winners will be startups integrating and owning the biggest verticals, and thus benefitting from both economies of scale and network effects.
I would bet on startups with this aim.
Happy new year to everyone.