Crypto collectibles and Kitties marketplace Rare Bits is placing itself to be the go-to site for cryptocurrency supporters, and beginners, who want to purchase digital assets.
Rare Bits, which launched in February, allows users to buy, sell and look for digital assets translated to cryptocurrency. The company has recently raised $6 million series A round. Spark Capital, First Round Capital, Twitch CEO Emmett Shear and founder and former CEO Justin Kan are among some of its biggest investors.
Rare Bits, which has dubbed itself as blockchain’s version of eBay, is trailing on the unexpected success of CryptoKitties, a game where users buy and sell digital kittens using Ethereum-based contracts.
Rare Bits functions as a platform and an intermediary between sellers and buyers and profits from taking a percentage of a developer’s income, if that individual produces a viable market for his or her assets. The company claims it processed over $100,000 in transactions in its first month.
But, compared to cryptocurrency exchanges or wallets, Rare Bits focuses more on crypto-based products without selling any actual cryptocurrencies. This is similar to buying an item on eBay: users search through a catalog of more than half a million digital items being offered by Rare Bits and choose the ones they’d like to buy.
Amitt Mahajan, Rare Bits Co-founder and also the co-creator of Farmville, founded the company together with two Zynga alumni, which grounds them on how to operate large virtual economies.
For the time being, Rare Bits is targeting consumers familiar with cryptocurrencies and are comfortable using them. But even with all the hype built up on cryptocurrencies and the growing number of people dipping their toes into the sector, Mahajan believes it can still be a daunting experience for newcomers.
“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?” Mahajan said.
Still, he believes there is enough room for people to get on board—for the right reasons. “Imagine if a celebrity like Beyonce or someone really well known were to release 10 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?” he asked.
“In the final version of our product, we may not even mention the fact that we’re using Ethereum or using the blockchain,” he said. “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,” he added.
Rare Bit’s platform could expand to other services such as real estate, software and music licensing in the future. The company is already workingon verticals like Fan Bits, which will provide social media influencers and content producers a platform to sell memorabilia directly to fans.
“Our goal is to bring people in who have never used crypto before and, without them even knowing it, help onboard them and get them to a place where they’re buying and owning stuff on the blockchain,” Mahajan said.