NFTY #56: Making ICE ❄️

What is the real value of Interoperability, Composability, and Extensibility?

NFTY tracks the ever-evolving narrative of how mainstream will enter crypto through user-facing applications. In each edition I explore dApps, games, and the ecosystem affecting consumer crypto applications.

The definitions of Extensibility, composability, and interoperability (ICE) are frequently talked about in the crypto community, but there is always some debate at what they actually mean and what value they provide for crypto applications.

I'm going to start by defining ICE:

  1. Interoperability - the ability of computer systems or software to exchange and make use of information.

  2. Composability - components that can be selected and assembled in various combinations to satisfy specific user requirements.

  3. Extensibility - the quality of being designed to allow the addition of new capabilities or functionality.

Interoperability is made possible by open standards. Many of the government's internal systems are interoperable and makes use of existing data.

An Android Phone is composable - a user selects different components that they'd like to use on their phone. The more components that exist, the more the user has a choice in creating the system that they desire.

Minecraft is very extensible but it is neither composable or interoperable. It's a game that benefits from multiple developers and creators building mods on top of it.

Why ICE matters for blockchain games and consumer experiences

There has been some debate on what value ICE provides for blockchain games

Extensibility - CryptoKitties is historically one of the only NFTs to have data on-chain. Even though it's more expensive to store the data on-chain, it allowed for more extensibility. Games like KotoWars give users the ability to fight their cats based on their on-chain traits. Developers for CryptoKitties and the KittyVerse are more often players themselves - they feel they have a sense of “duty” to increase the value of the NFTs.

Composability - Cheeze Wizards is built for composability as opposed to extensibility. The entire gameplay of Cheeze Wizards is stored in a single smart contract, making it easy for developers to spin up their own tournament if they choose. The CryptoKitties breeding contract is not composable because it doesn't benefit third-party developers like the tournament contract does.

Interoperability - Interoperability is the most difficult to achieve of the three, and the business case has not been proven. While users would love to use their game items from game to game, companies leak out potential revenue by including outside data (items) created by another company. It's safe to assume that interoperability between games in one studio is beneficial - and may even provide a new acquisition loop.

You need decentralization at the base-layer in order to make ICE

Many blockchain games have recently been using second-layer scaling solutions like sidechains in order to create a better user experience. In an effort to create a better user experience, this actually makes makes ICE worse. By separating data into partitions rather than a single layer, it makes standardization, extremely crucial for ICE, difficult.

The growth of marketplaces and second-layer games hasn't seen a huge uptick because developing on second-layer scaling solutions are difficult even though it hides the complexities of blockchain for the user.

I co-wrote an article that was published on CoinDesk this morning mentioning the opportunities for open ecosystems/ICE enabled by decentralization.

**Hope you can give it a read here.**

Disclaimer: I work on helping create a world of infinite possibility at Dapper Labs. All opinions and words written in NFTY are my own.