CryptoSportz is an up-and-coming decentralized platform that seeks to take advantage of blockchain technology in order to disrupt the online sports betting industry. Despite being on an embryonic stage, they seem to have all the right technical know-how’s and fundamental aspects planned out.
Players can bet against each other, like they would on a good old “street bet”, except this is achieved through smart-contracts on Ethereum’s blockchain. According to Tomash Devenishek, leader of the project, this was actually the main inspiration for their project:
The project started as a conversation between me and some university friends that live abroad. We couldn’t easily and safely bet each other on the teams that we like, so we jokingly said “there should be a smart contract for this!”.
As such, CryptoSportz is essentially an online open market for sports bets. You can create a market with odds of your choice or accept an odd offered to you by someone else. In a way, you may think of this platform as a true contender to becoming a decentralized version of Betfair, the most renown betting exchange.
Tomash is a tech entrepeneur who has been coding since he was 13 years old. He has a background on software development, marketing and is also the founder of Peller.tech. In an exclusive interview with CasinosBlockchain he walked us through CryptoSportz’s main features, some of which make it particularly unique within the “crypto” sphere!
The whole model is quite innovative, so it wasn’t always easy to fully grasp how some of these features work. At times it made about 70% sense but we were 100% interested. For example, the platform allows you to become the house by creating the right markets with the right odds for an event; this essentially guarantees that you can make a small profit regardless of the event’s outcome.
We followed it up with a Q&A about the most interesting aspects of their project.
1 – Is there a legal framework for your platform? How will you be approaching this in terms of licensing?
There is definitely a framework. There are very similar platforms such as Augur and Gnosis which have paved the way for decentralized prediction markets. I think the Augur team is mainly located in San Francisco, which as you know is one of the most restrictive places. We have had multiple discussions with gaming lawyers in a number of jurisdictions and of course want to make sure that Crypto Sportz is on side when it comes to sports betting frameworks.
Luckily we have these other platforms as precedent for us to follow. It’s a very interesting space that regulators do not really know how to approach. If and when we have some proper guidance and structure, Crypto Sportz would be happy to follow the rest of the pack on decentralized prediction markets regulation.
2 – What is the current focus of your team? Do you have a roadmap for this year?
My previous experience with building technology products says you need three roadmaps: a one-month one, a six-month one and a five-year one.
The micro roadmap includes focus on smaller features, usability, etc. Medium term roadmap focuses on things like adopting to mobile and adding other highly requested features. The long term vision is to have a Crypto Sportz protocol that can fully decentralize every aspect of the user experience. The team is working to build a secondary chain for sports data that will be powered by a proprietary consensus mechanism between sports data providers where they can reach consensus that game X ended with 3:0 and write that to a chain which smart contracts can automatically use.
It’s a huge undertaking so we see that as our long term path, but it’s one of the coolest problems that one can work on and there are many amazing projects like Tendermint, Stellar, etc. that are kind of paving the way for us in these “consensus theorems” which we love looking at and playing with.
3 – You have mentioned that you use signatures in order to circumvent Ethereum’s scalability issues. How does this work?
Not everything needs to be a transaction on Ethereum. If I’m sending you ETH or am performing an actual change in something, it needs to be a transaction. But if I am simply signaling that “I am ok with X”, I don’t need to perform a transaction for that. Knowing how to adapt to current challenges of the network is key for us if we want to drive actual usage. Side chains, state channels, etc. are all ways to scale the existing throughput but sometimes the architecture of the platform/smart contract itself can help with scalability. This is why we use signatures in certain places.
4 – As things stand you only accept Ethereum. Will you be accepting other cryptocurrencies in the future?
It’s funny that so many people still say “you accept ETH” because we don’t actually accept anything. We just built a smart contract on Ethereum and a system that helps users make and accept predictions about the outcomes of sporting events. But I think your question is more related to whether we would be looking to build on any other chains… I would love to build something decentralized that uses BTC, but to my best knowledge this isn’t possible as of this moment – at least in a very safe and scalable way.
We’ve also talked to some awesome chains like AION (also Torontonian) about building Crypto Sportz on their technology/network and love the better technical environment that chains like that sometimes represent, but the key for us is creating usage. So we are keeping our eyes open to solutions that might help with overall adoption and usability.
5 – As for the sports you offer, will users be able to create markets in other sports categories like e-sports?
One of the issues with platforms like Augur is the lack of structure and too much openness because it creates ambiguity. You cannot have that in prediction markets. We want to be sure that our use case is very clear, concise and structured because structure creates efficiency. Imagine having your bet be stuck for four weeks since the World Cup before getting paid. Even if you doubled your ETH, you’re potentially down in USD because the price of ETH has gone down a lot since then. I bring this up because having clean and structured data helps create that speed and utility. For e-sports we want to be able to have some structured way that we can pump out 10-20 markets per day (as we do with football/soccer for example).
So yes, e-sports is coming and we’re very excited for it. Cricket is another sport that we want to support but structuring decentralized markets with that data is not as easy for us as it is for a centralized book. They can afford to just sit there and manually handle results, payouts etc. whereas with Crypto Sportz everything is done by a smart contract that we cannot reverse or control.
6 – Blockchain has tremendous potential in sports betting. One would think it’s only a matter of time until a decentralized version of a betting exchange like Betfair is created. Are your future ambitions aligned with this? What kind of advantages could this bring to your players?
Well, to an extent there is a decentralized Betfair already and it’s called Crypto Sportz. Yes, it features less sports and less volume but we are at early stages. The real advantage for a blockchain solution is you get to bypass the extremely complex ecosystem that is behind centralized betting. The benefits of bypassing that is that you skip paying the fees that come associated with it.
In terms of value for the end user there is no doubt in my mind that our platform offers the best value because we do not charge any fees at all. We can do that because the blockchain performs the operations that in a centralized world people will charge fees for: payments, house advantage, exchange fees, etc. They collect those fees because they do that work, but when the blockchain can do the work in a P2P setting there’s no need for those fees anymore and that is what we want to do, bring that value back to the users.
I also think that an underlying point should be made about the fact that any existing sportsbook can technically whitelabel Crypto Sportz and start creating their own markets which once again helps us bring value back – both to the book and the punters. So we do not see ourselves as a hostile solution to what is there today but rather as an example of where things are going because overtime people find ways to bring value to users, especially in P2P environments.
Other interesting platforms like OneHash achieve similar purposes but not in such a decentralized way. In Crypto Sportz there is absolutely no KYC (Know Your Customer) involved, you just use your MetaMask wallet to sign your bets and their platform will provide a smart-contract solution to match your bet to another peer’s bet. In OneHash you have to create an account with a valid e-mail and make a deposit in a wallet provided by them. Another fundamental difference is that OneHash uses the Pari-Mutuel betting system and Crypto Sportz doesn’t.
The surge in ETH wagered throughout the last weeks on Crypto Sportz platform, possibly driven by the start of European football championships acts as an indicator that players are willing to use their product. In the past two weeks their volume has doubled from 280 ETH to 580 ETH. From a sheer number’s perspective that’s quite good!
From our time with Tomash we get a feeling that Crypto Sportz has not only a lot of potential but also great structure and fundamentals to build their product. This is the kind of project that can truly pioneer blockchain and cryptocurrency adoption through real and efficient use cases.