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The structure of the legal gambling market is striated, broken up into many related but separate avenues for online and offline projects. The myriad options that exist present unique challenges for newcomers to the market, no matter their desired entryway. But whether online or off, the key to success in the gambling industry, like in many others, is to stay ahead of technology and incorporate its strengths quickly. When the technology in question is blockchain and cryptocurrency, deployment speed and application can mean the difference between success and defeat.
To find the opportunities that exist in the market, we first have to understand its makeup and where to best deploy the tech. Brick-and-mortar institutions, like casinos and the larger state-run lotteries, still dominate offline projects and net 37% and 31%, respectively, of the offline market. Online projects are more difficult to accurately describe due to the nature of the medium, but nevertheless, similar patterns emerge. Sports Betting holds a whopping 51% of the online gambling market, while casinos and lotteries rank second and third at 30% and 13%, respectively.
In the online market, sports betting commands a sizable lead because of its relationship to large institutions. Online sports betting offers people access to one of the most popular forms of gambling that is usually controlled by states, institutions, or other organizations. Because of the decentralized nature of the internet, sports betting would naturally find its home in the online sphere. But why have online casinos and lotteries failed to take off in the same way?
The short answer to that question is: trust. Users are wary of their data becoming exposed and don’t trust the organizations currently operating, while layers are afraid that casinos and lotteries, as high-value companies, will become the target of attacks and they will lose their money. To make matters worse, governments and gambling organizations are wrestling with their own issues of trust, unsure of how to implement new technology like blockchain, and whether or not to accept cryptocurrency.
Fortunately, the advantages of cryptocurrency and blockchain have the ability to solve these issues immediately.
The Advantages of Blockchain for the iGaming Industry
Blockchain is one of those technologies that, once it is implemented, there’s no going back. Life before blockchain and life after are two very different things, and people in the post-blockchain world will wonder how they ever let themselves do things differently. But, let’s look at the opportunities offered by each for the iGaming industry.
iGaming Without Blockchain
This is the current standard for Real Money Gaming (RMG), and it works the same as an exchange service. A user or player sends their funds to the game’s owners, which are then recorded as balances in the owners’ databases. Users and players access their funds through an account on the game owner’s platform, and updates are executed centrally by the owners. It is fast, it is easy, it is also dangerously insecure.
Speed is the biggest advantage iGaming without blockchain can offer, but for most people the risks would be too great. It requires players and users to not only trust the game owner to treat them fairly within the game, but to also protect their funds from outside attacks. There are too many variables and trust is difficult to establish because of it.
iGaming with Blockchain
One of the greatest benefits blockchain brings to an industry is an unparalleled level of transparency. Online casinos are no different, and transparency, with the proper encryption and security through smart contracts, can only make the industry better. With the blockchain, trust is automatically established and can be maintained even across complex systems.
Blockchain detractors will cite its speed limitations as concerns within the iGaming industry, but those fears are generally unfounded. Current technology is more than capable and Moore’s law holds true for most technology, even if it hasn’t for transistors. Thus, blockchain solves the trust issue hindering online casinos growth, allowing for more games, software, interaction, and players.
iGaming with Blockchain is the only gambling experience you’ll ever have where everyone wins.
Evaluating an ICO: Too Good To Be True?
There’s a lot of money to be made at the moment in the iGaming industry. Autonomous NEXT magazine pointed out that during the first two months of 2018 alone, more than $391M was raised for iGambing ICO projects, $71M more than raised over all of 2017, and 61X more than was raised in all of 2016. Nevertheless, 59% of last years ICO projects failed.
But with that much money being thrown around, and because of the knowledge gap between communities, scammers have targeted iGaming and ICOs. In a recent Wall Street Journal investigation, fraudulent ICOs raised, and walked away with, more than $1B. ICOs, Cryptocurrency, blockchain, and iGaming all present scammers with opportunities to swindle those less informed.
Therefore, investors face an especially difficult task at the moment: how to differentiate a promising ICO, one with actual potential and use, from a scam that sounds good. Investors interested should look for key performance indicators to make their decisions.
- How detailed is the White Paper? Does the math check out in the project’s algorithm? Does the road map lay out an actual plan? Is it well written? All of these can be indicators of a scam.
- Does the project have a working Minimum Viable Product (MVP) at the ICO’s launch?
- Are the Team Members who they say they are? Do their social media links work?
- Has the company been audited by a reputable independent company? Did that audit come to a positive conclusion about the project?
- Does the project have a reliable partner? Does it have more than one willing to vouch? Are the project’s partners themselves companies with good reputations? Or have the partners also been involved in scams?
These are just a few basic questions investors should ask themselves before participating in any ICO, especially an iGaming ICO. Luckchemy is a perfect example of a company running an ICO the right way, and following its recent partnership with Mr.Bet, it fulfills all of these requirements.
- Luckchemy followed their road map, perfectly. The platform is being developed on schedule with regular updates and the team has been actively releasing new games like lotteries, scratch cards, and slots.
- Luckchemy had a working MVP before even going to their ICO.
- Project co-founders Alexander Tatarchuk and Alex Topchienko have more than 13 years of managing web products for both mobile gaming and digital marketing. CMO Mark Beck has more than a decade of experience in the gambling industry scaling some of the largest social casino apps in the world.
- In April 2018, New Alchemy performed a comprehensive audit of Luckchemy and gave several recommendations, after which a second audit was conducted. The result was that New Alchemy came to the conclusion that Luckchemy’s smart contracts were extremely well protected and there were no critical vulnerabilities for hackers to exploit.
Luckchemy’s Partnership with Mr.Bet
The final piece of the Luckchemy puzzle was added when it entered into its partnership with the new iGaming powerhouse, Mr.Bet.
Mr.Bet is an online casino with a wide array of games, like slots, table games, and live casino titles. Launched on Malta in 2017, Mr.Bet runs promotional offers for new and existing players, but also has a system in place for players to play with free bets. The company is well regarded and has an extremely active community. As such, Mr.Bet operates a complimentary customer service team 24/7.
Luckchemy’s partnership with Mr.Bet is twofold. First, it puts Luckchemy’s blockchain-based games directly on the Mr.Bet platform. This means Luckchemy gets more exposure on the platform while Mr.Bet gets to increase its library. Second, Luckchemy provides its technology to Mr.Bet, benefitting Mr.Bet’s platform and mobile app. The partnership also establishing a publishing pipeline for future games.
The result is a win for everyone. Players get access to games from two companies, Mr.Bet and Luckchemy, on a reliable, secure platform. Mr.Bet will get access to better technology to improve its burgeoning iGaming empire, and Luckchemy will receive credibility from one of iGaming’s biggest names. That validation and prominence will be invaluable to Luckchemy as it continues to attract investors to its ICO.
The Right iGaming ICO Strategy
There’s a lot of money to be made out there on a lot of promising projects, but sorting through the ICOs can seem daunting, confusing, and like an accident waiting to happen. When in doubt, remember to ask yourself those key questions about the ICO you’ve considered investing in and use Luckchemy as an example of what to look for. And for those interested, Luckchemy’s ICO is currently underway. Visit Luckchemy today to find out how to receive tokens at a 40% discount.