It turns out that the game of chance, not the purchase of digital kittens, is one of the most popular applications on the blockchain, the technology of distributed books that was advertised as the solution to everything from hunger in the world to transfer money.
a recent 24-hour period, the app Fomo3D has attracted more than five times the number of users compared to CryptoKitties, the game that involves breeding cats that notoriously have clogged the Ethereum network last year. Even the gaming app, in which competitors try to shovel others using a fictitious currency, is also profitable. Players have posted more than $ 40 million on the distributed app since the first version was launched in July, according to the game's main designer.
Fomo3D is certainly not the only app for the blockchain-based gambling game. Among the top 10 apps distributed by the money received, the gambling game as a category is only second to the exchanges, according to DappRadar which keeps track of the applications run on blockchain. Sales of gambling chips also continue to increase: Dragon Coin and another ICO have raised nearly $ 1 billion, while another 21 projects have raised another $ 300 million through initial coin offerings, according to autonomous research.
Ethereum, and you can get more, "said Dragos Dunica, co-founder of the DappRadar app tracking service, in a telephone interview." At this point in Ethereum, most people look for the profit, to get something in return. "
Ether, the cryptocurrency used on most networks, has fallen by 74% from its January peak, while its biggest rival Bitcoin is down nearly 70 percent from its historic maximum in December.
Many of the gambling efforts come from questionable and anonymous teams.A former Macau gangster known as Broken Tooth has been linked to Dragon Coin. Fomo3D, whose identities of developers are not disclosed, was accused of being a ponzi scheme, although the chief designer of the venture, which is part of Justo, said in an e-mail that the app is "ridiculously honest" because it is governed by software. Once set, the s oftware, which directs payments, can not be changed, he said. Most blockchain outfits are not authorized or legal.
Even so, distributed apps, which are governed by a so-called software-based smart contract that sits on a blockchain, continue to engage users. A non-blockchain legal site, PokerStars – the most popular online poker site – attracted around 8,600 people on an average day in the last week, according to Traffic Tracker PokerScout.com. More than 10,000 people were playing Fomo3D on a recent day in late July, according to DappRadar.
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That gambling is getting hot on the blockchain-based web, often called Internet 2.0 for its potential to link tokens to various new features should not come as a surprise. Gambling was among the first areas to make it big on the original World Wide Web. The $ 40 billion market for online gambling is already growing at the compound average rate of 11% per year, according to Transparency Market Research.
While many players in places like China and India, where gambling is either illegal or heavily restricted, already use online gambling sites, they fear being caught. Blockchain-based sites may offer them more privacy, leaving only players to access identity information – hiding them from governments.
"It makes gaming a more friendly place on the Internet," said Sunaxi Sangole, an analyst at Transparency. in a telephone interview.
Transparency is another attraction that the blockchain holds for gamblers. Technology can potentially help sites and apps prove that their games are fair. All transactions are recorded on the blockchain and the software governs how the funds are distributed to the winners.
"The point was to provide people with an instrument to play knowing that the results will not be altered," said Anton Ivanov. founder of Dice2.win, which allows players to roll a die or throw coins, he said in a telephone interview. "The house can not work with money, and be as transparent as possible."
New companies like Unikrn, using the blockchain for some features, also hope to take advantage of the new opportunities made available by the United States. The Supreme Court decision at the beginning of this year that legalized sports betting.
"We turn to a younger client base, a customer base that wants to do things much more quickly," said Rahul Sood, CEO of Unikrn in Seattle. "More than anything, it will expand the market, while export bets are still quite nascent." The company, whose investors include Dallas Mavericks owner Mark Cuban and actor Ashton Kutcher, has already partnered with MGM Resorts International to organize weekly tournaments of esports inside the MGM Grand Hotel & Casino.  The blockchain also opens up potentially new – often shocking – ways to play. Prediction markets app Augur, for example, lets people bet on the death of public figures.
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It remains to be seen whether some of the unlicensed athletes will be closed by regulators.
"The background of projects that raise massive controls of the ICO gambling game does not bode well for government acceptance and regulatory approval of such activities," Lex Sokolin of Autonomous research, he said in an e-mail.
Various types of online gambling games are only allowed in a handful of states. Most casinos do not accept Bitcoin, and "most regulators are not prepared to deal with it at the reporting level", said Matt Kaufman, researcher analyst Eilers & Krejcik Gaming.
"The fact that they will not accept deposits certainly makes them less at risk of being targeted" Said Kaufman. "Regulators are more likely to pursue bad actors where they can expect a result."
– With the assistance of Christopher Palmeri