According to an interview with CNBC, Ammit Mahajan, the co-created of social network game FarmVille and co-founder of Ethereum-based digital asset marketplace Rare Bits has revealed that the latter company managed to raise $6 million in a Series A funding round run by Spark Capital, Twitch CEO Emmett Shear, and founder Justin Kan.
Twitch’s Interest in an Ethereum Marketplace
Digital collectible assets such as CryptoKitties are recorded onto Ethereum’s unchallengeable blockchain protocol as smart contracts, and these contracts can be relocated out its native CryptoKitties app to platforms such as Rare Bits where they can be traded with other Ethereum users.
The gaming industry has always tried to look for efficient ways of simplifying the trading of in-game assets. Platforms such as GameFlip, G2A, and PlayerAuctions have served as mediators and to aid players with buying and selling in-game items.
Twitch, a digital live content video platform, mainly focuses on gamers and streamers unlike other platforms such as YouTube that feature a wider variety of content creators.
The prospect of trading in-game collectibles on the Ethereum blockchain might have driven Twitch CEO and founder Emmett Shear and Justin Kan to invest in the platform, after seeing the successful fundraising round of Rare Bits.
Rare Bits founder Mahajan stated his hopes of seeing in the long-term non-cryptocurrency products on the platform together with digital collectibles, for instance, backstage passes to concerts and second-hand goods.
In the short to mid-term, Mahajan said that the team will concentrate its efforts on getting more people from outside the crypto sphere interested into its platform. For the time being, Rare Bits would be of interest only to cryptocurrency supporters, but to attract regular consumers in the bigger market, Mahajan believes this would require a special incentive structure.
“The issue with this today is if I have nothing to do with Ethereum, I don’t know anything about it and I’ve never thought about it, why would I ever go out of my way to buy Ethereum and get involved in this ecosystem? Imagine if a celebrity like Beyonce or someone really well known were to release ten backstage passes on the blockchain, how many millions of people do you think would go out of their way to acquire one of those things?” said Mahajan.
Competing with eBay
In the end, Mahajans specified that the Rare Bits’ purpose is to dissociate its platform from the “blockchain” and “Ethereum” labels so it can bridge the gap between the cryptocurrency sector and regular consumers.
“In the final version of our product, we may not even mention the fact that we’re using Ethereum or using the blockchain. In an ideal world, you come to the site, you buy something you want, you exchange it, trade it [or] use it, but you don’t care or even need to know that the underlying technology is crypto-based.”
There is also a risk if the platform is really serious about distancing itself from its niche market to move to a broader market sector and to successfully apply that approach.