Betting projects on the blockchain - new hype or future?
Background storyAfter spending some time in London this week, particularly at the Blockchainweek conference it seems to me the new hype in the cryptoworld is Betting/Gambling.
We've seen some gambling projects in the Q3-Q4 of 2017 mainly based on the concept of lotteries, dice games and online casinos:
I've picked out the once who implemented their own token into a betting platform, however except for Funfair, based on market cap, none of the gambling coins are doing so well.
New Hype?
It's not a coincidence that there were two Blockchain-based betting projects who pitched their vision at one of the biggest Blockchain conferences in London.
After doing some more research on the web - Coinschedule upcoming ICO's, Medium and general google search I've found alot of listed projects.
Google search trend analysis on the term "blockchain betting" also showed peak interest.
I've produced a list of betting projects with live or upcoming tokensales:
Further research
Investors interest
- Size of the gambling/betting market is over 3 trillion dollars
- It has a proven business model
- The current conventional betting system has many flaws - summed up in a detailed blog post I found
Technological benefits of the blockchain
- Security preventing the manipulation of bets
- Transaction ease of platforms like Ethereum
- No regulations to date, because no "real (fiat) currency" is used in the betting process
- Betting licenses are not applicable (to date)
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After reading the whitepapers of the listed ICOs I've found the following red flags and thoughts I'd like to discuss here:
1. Small bets and gas price - Many projects aim at the social betting market. If the majority of people places small bets (<20$), will the gas price of the transaction be too high?
2. Transaction speed - This is a problem especially with live eSports bets. Is the transaction speed of platforms like Ethereum fast enough to place bets within seconds?
3. Truly decentralized? - Alot of the projects claim to be fully decentralized, however provide the result validation through a third-party. Does this open up space for result manipulation?
4. Legality and regulations - I have no judicial background, but I'd like to know more about the legal standpoint of this, how soon can we expect regulators targeting these projects?
1. Small bets and gas price - Many projects aim at the social betting market. If the majority of people places small bets (<20$), will the gas price of the transaction be too high?
2. Transaction speed - This is a problem especially with live eSports bets. Is the transaction speed of platforms like Ethereum fast enough to place bets within seconds?
3. Truly decentralized? - Alot of the projects claim to be fully decentralized, however provide the result validation through a third-party. Does this open up space for result manipulation?
4. Legality and regulations - I have no judicial background, but I'd like to know more about the legal standpoint of this, how soon can we expect regulators targeting these projects?