NFT-based Gambling Idea / Proposal
Crypto gambling!

NFT-based Gambling Idea / Proposal

By SwiggaJuice | NFTfanatic | 2 Jul 2021


This article is meant as a purely hypothetical idea at this point because, frankly, I'm not sure what any rules or regulations might be in place to make this idea either impractical or illegal in some areas. But that said, I know that (1) gambling is huge worldwide, and (2) it's definitely legal in some areas. So, I'm not suggesting anyone actually DO this without doing the proper research. But, from a purely academic, marketing, and development perspective, I find the idea highly interesting. (And, almost certainly, someone has thought of this. It's new to me, though!) So, here it is:

I had this idea today for an NFT-based gambling system, kind of like a lottery. It'd run like this:

  • First, you'd want to setup a Decentralized Autonomous Organisations (DAO) of people involved. A DAO is basically a blockchain-based, highly organized, type of organization structure that helps ensure complete integrity with respect to how this idea runs. The DAO would have a strict treasury and rules to ensure everything works as planned. (I'm fairly new to DAOs, but the concept is explained here.)

  • The DAO members nominate and hire an artist. This person will design the tickets. (In fact, the DAO nominates and hires everyone involved on the admin side of things, just to ensure everything is on the up-and-up!)

  • The artist forwards the approved ticket artwork to a developer, who then auto-generates 10,000 NFT tickets, which will each bear the artwork plus a visible serial number from 0000 to 9999. (This makes it easy for people to go to the NFT marketplace and browse tickets, purchasing the one(s) they want.)

  • Tickets get dropped in bulk at the same time -- bam, 10,000 tickets now available (on a pre-determined date)! People then go buy whatever tickets they want.

  • Once all 10,000 are sold, the DAO announces the date of the game (e.g., we publish that the game will happen on a specific date in the future -- e.g., a few days or a week out).

  • On that future date, we need a system to draw 5 random numbers. It has to be something novel and uncontrollable / truly random. For example, maybe we select 5 tech stocks (e.g., Apple, Microsoft, Amazon, Google, Facebook) and list a specific order for them. And we then agree on a specific digit from each stock. For example, we pick the first first digit left of the decimal (the 1s digit). So, if Apple's published price on the game day is $136.95, we would choose the 6. And from those 5 stocks, we would get out random number from 0000 to 9999. (Or, some other system. I'm just trying to think up something that should be what mathematicians like to deem "good quality randomness.")

  • Anyway, we setup a prize pool of something as high as possible -- like 90+% of the funds. (The other 10% go toward development, admin, etc.)

  • The DAO treasury then verifies the official numbers according to the rules, and there would be a system for distributing funds to the winners. (Since the buyers & tickets are on the blockchain, I think we should be able to just payout the winners automatically.)

  • And then you do it again monthly / weekly, whatever.

  • As a super-amazing bonus, everyone at least gets a cool, designed NFT (which itself could very well *increase* in value as time goes on).

In the above example, which is admittedly rough, if you sell 10,000 tickets at 0.01 ETH, that would round up 100 ETH. If 90 went to to the prize pool, you could do something like offering 50% to 1 winner, 25% to a 2nd place, 10% to a 3rd place, and maybe 15% to a group of 50 others. In this specific example (using *today's* market value), the distributions would be: (1) first place -- ~$100k in ETH, (2) second place -- ~$50k in eTH, (3) third place of about $20k in ETH, and (4) 50 people getting about $600 in ETH each. And then the other 10ETH is for admin costs -- the artist, the developers, the marketers, and I guess the DAO's own treasury for marketing purposes.

I'm like 90% sure that would be completely illegal in some way I'm not aware of. But nevertheless, I had the idea and thought it might be fun to at least think about (thinking is still legal, correct?), as there could be some workaround given that the thing would exist wholly online and in the cryptoverse (is that a word?), and/or because there would be real NFTs involved, which it could be argued provide value in and of themselves. (Thus, people aren't buying chances to win, they're buying art -- and the whole prize thing is just a side benefit of the whole thing.) Anyway, again, not suggesting anyone do anything if it's illegal. But maybe the idea alone could inspire someone to do something along these lines. If anyone cares to brainstorm this, feel free to reach out. I'd love to be involved in something like this, but only if it's legal, of course.

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✍🏻 Jim Dee runs Array Web Dev. in STL & PDX. NFTuxedoCats is his current NFT project (a set of 10,000 unique programmatically generated Tuxedo Cats). Jim blogs more than he should and is obsessed with NFTs. His 2019 novel 🐕 CHROO 🐕(a guaranteed good read about the world’s richest dog — seriously, please buy a copy!) may well have been the first novel to incorporate an actual crypto address within the text! Comment or email anytime: Jim [at] ArrayWebDevelopment.com.  Article photo by dylan nolte on Unsplash.

 

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SwiggaJuice
SwiggaJuice

Web developer, DB app coder, and NFT fanatic. New NFT project is NFTuxedoCats.com!


NFTfanatic
NFTfanatic

Various thoughts and musings related to non-fungible tokens (NFTs).

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