On Tuesday we announced our investment in Cryptokitties, and, as you might expect, received a combination of enthusiasm and skepticism in response.  Bitcoin and cryptocurrencies already sound ridiculous to most people, and virtual "real" kittens made out of cryptocurrency take it a step further. But, as with many new technologies, these first use cases just scratch the surface of a broader potential.  There are lots of things to be excited about here, but for now I'll just focus on one of them: interoperability. Cryptokitties are a specific type of cryptoasset, known as a "non-fungible token" (in this case, based on the ERC-721 standard).  Non-fungible means that each one is unique.  So, when a kitty is "born", it is a one-of-a-kind digital asset, as opposed to other types of currencies or tokens that are completely interchangeable.  So, they are different than other tokens in that way, but are similar in that each NFT is "scarce" or "real" in that is secured by the blockchain - in this case the Ethereum blockchain.  So, what we have are unique, scarce, public digital assets. The public part is particularly interesting.  Because each kitty is a token on Ethereum, that means that anyone else (aside from the original developers of Cryptokitties) can view that asset and integrate it into other systems, without anyone's permission. For example, on Kittyhats -- developed independently from CryptoKitties -- you can buy a hat for your kitty.  Here's the one I bought:

(There are now 899 flat brim hats still available if anyone is interested) What's particularly interesting is that I don't own the hat, my kitty does -- from the KittyHats whitepaper:

"When you sell a kitty, the sticker remains applied to the kitty. The new owner can choose to remove the sticker or leave it attached."

Or, put another way:

You own the cat. But the cat owns the hat.

Cascading unique digital good ownership. Super interesting. https://t.co/iGqaWics2E — Liad Shababo (@L1AD) March 22, 2018

So neat!  So what we have the beginnings of is a world where digital assets that are created in one place can be freely integrated into other places. If hats are too tame, you can also race your kitty at KittyRace: (updated, via @sidkal)

Or, when you've had enough of your kitty, you can head over to CryptoZombies (hat tip to Aaron), which teaches Ethereum programming via online game development.  As you create a zombie, it can start to do things.  One of the things it can do is eat CryptoKitties:

The (original) internet brought us a world where any site could link to any other site, and they could all be accessed from anywhere in the world.  This was the first interoperability revolution.  The next one will be with data and digital assets.  For a long time, data has been the property of platforms -- with cryptonetworks and cryptoassets, data can live outside of anyone platform, under the control of users.  This has the potential to open up a lot of innovation.