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it also demonstrates very clearly that eth sure as hell doesnt scale well right now
This is getting addressed with side chains
I think side chains are going to be the future of dApps. Smart contracts alone won’t be enough
I don't really see this as a problem. CryptoKitties is a centralized product, something you can build on Ethereum, if you like it or not.

And I don't really have a problem with that if the creators keep a good track record.

I think a lot of people believe they are getting a unique item that can never be copied.