But these coins do more than simply offer potentially massive profits to those that invest in them; they are also increasingly underpinning the online gambling platforms of the future. A fresh batch of blockchain-powered online games and casinos are redefining the way this industry operates, and the blockchain gambling start-ups that have invested in ICOs are reaping the biggest rewards.
iDice, a blockchain gambling game built on Ethereum, is an example of how a successful ICO can shoot new online gaming businesses to prominence. As the world’s first blockchain mobile gambling app, iDice was able to raise US$2.5 million in two weeks through its ICO. The results were telling, as iDice saw its winnings climb from $300,000 to $800,000 in a matter of weeks following the stunning crowdsale.
New blockchain-based casino Edgeless, an online gambling initiative that promises users a 0% house edge, is also reaping rewards from a successful ICO. The company’s hugely successful ICO raised over $2 million in the sale of EDG tokens to over 700 supporters earlier this year. EDG works as an in-game currency on Edgeless and also gives token holders a chance to win 40% of casino profits through a monthly profit-sharing lottery. Edgeless uses transparent, Ethereum-powered smart contracts to protect users from rigged outcomes, delayed fund withdrawals and other rogue ploys that various online casinos have employed to boost their profits at gamblers’ expense.
And FunFair is another online gambling venture that is making waves. Again based on the Ethereum platform, the Singapore-based company raised a whopping $26 million through a three-week ICO, in turn powering the creation of fair, fast and varied online games that come complete with minimal transaction fees and the opportunity for players to play directly from their cryptocurrency wallets. The latter means players don’t have to deposit into their FunFair account, as is the case with traditional online games and casinos.
Celebrity Investors Dive In
The recent success of ICOs in the online gambling space has caught the eye of world-renowned entrepreneurs, too. Mark Cuban, a billionaire American investor who owns NBA franchise the Dallas Mavericks, has expressed interest in pouncing on the ICO trend. Specifically, Cuban is looking to invest in Unikrn, an Ethereum-based esports online betting site that is set to launch in September. Oddly, Cuban has been a vocal sceptic of bitcoin in the past, accusing the world’s most renowned digital currency of being overpriced. But it seems he is embracing the potential of ICOs to generate quick profits while ushering in a new era of online gambling.
For all the success stories within the recent ICO fundraising trend, the rapid rise has drawn the attention of hackers. There thus remain risks associated with ICO investment. In one instance, for example, a hack of the aforementioned Edgeless Casino resulted in the project losing $5.6 million worth of ether. There was also a hack of CoinDash’s website in the midst of an ICO, which redirected $7 million worth of ether into the pockets of a hacker.
Such security breaches have the potential to abruptly end certain crypto-coin projects, costing investors serious money in the process. It also gives additional ammunition to Wall Street sceptics who frown up the rapid rise in price of cryptocurrencies and their associated security risks. If the cryptocurrency and ICO market is to continue to prosper while helping gambling start-ups evolve, new strategies and additional security measures across token sales are essential.