While speculations are rife over the effects of China’s crackdowns on cryptocurrencies, game developing company Animoca Brands has announced that it will be buying a 60% stake in US-based Fuel Powered. The company has contracts with such companies like Sega and Axion Zen, the latter of which has agreed to have Animoca distribute CryptoKitties in China.
Given that CryptoKitties generated close to 300,000 sales within the game amounting to nearly $20 billion USD worth of sales, the potential for the game in China is huge.
Mobile games have an extremely high user potential in China, with some of the most popular ones enjoying users in the millions, daily. Not only is it a huge market for the game itself, but it is also a positive step in the face of tightening regulations against cryptocurrency mining and trading in the country. If negotiations get through well, we might be looking at a further expansion on the game, especially as it is being speculated that new features and enhancements will be added to it specifically for the Chinese market.
This move also brings it’s problems. The game might fall under strict regulations given the uncertainty displayed by China regarding cryptocurrency trading, aside from fears the the Ethereum blockchain will not be able to handle millions of new users on its servers. The 30% rise in Eth transactions in December 2017 slowed down the network, and given the launch of other games like World of Ether and CryptoCelebrity on the same currency, the servers will not be able to handle the amount of transaction traffic.
Blockchain technology may have greatly expanded over the past few months, but it still hasn’t reached the point of handling millions of users at a time, especially if these users enter the market suddenly. Axiom Zen, while working on the legal issues surrounding China’s stand on cryptocurrencies, is working on this ‘current scalability crisis’, as some news agencies put it, as this might make or break the potential foray into the Chinese Gaming world.
Personally speaking, the launch may be a blessing especially in terms of the game’s current gaming interface. It is possible that, on successful launch, new features will slowly also be made available for older players in the game. This will vastly improve on disappointment about the game’s progression, which as of now is more of a collectibles game than anything. With increasing competition from new games being launched on the Eth blockchain, the launch will greatly expand and secure the game’s user base for a long time if successful.
As to whether the sudden influx of new users will affect the prices of the virtual cats and the currency itself, nothing is certain. The new users might increase the demand for the more rare or prestigious cats, further driving up price. The strain on the servers not withstanding, a price markup might push gamers away in a counterintuitive move that might disrupt CryptoKitties’ sales as well as future development. At any rate, despite the crackdowns and technological difficulties, the developers believe that the Spring Festival, that this year will be from February 15-17, will be as ideal time for the launch.