Look at the number of people that collect all kinds of crap: DVDs, video games, stamps, baseball cards, in-game virtual items, comics, art, etc. You can argue that some of it has more utility -- art is culture! you can watch a DVD! -- but the mindset of collecting goes beyond that, and certain utility, like games or trading cards, maps just as well to the crypto collectible world. Cryptokitties is an early example, but I am 95%+ confident something like it will be a HUGE hit within the next few years. So yeah, why not use the crap you already collect to secure a loan?

You have no idea how much you underestimate what CryptoKitties started. Cryptocollectibles will most likely be the first killer app. It's not about the kitties, it's about the underlying mechanic of owning a truly unique digital item.