Anyone who’s been paying attention to cryptocurrency and blockchain for the last decade has seen countless promises of the lofty changes this new technology will bring: a revolution of the world’s financial systems, reformation of voting processes, decentralization of media distribution and advertising, and beyond. However one of the key applications of blockchain that hasn’t attracted quite as much notice is the field of gambling – and crucially, not only is blockchain good for gambling, but the reverse is also true: gambling is actually good for blockchain. To see a powerful example of this truth, it’s worth looking back in time to a project called SatoshiDice.
SatoshiDice was founded by Erik Voorhees in 2012, and consisted of a set of wagers with different odds. Users would choose which wager they wanted to play, send their Bitcoin to the associated address, which would automatically generate the result and return any winnings back to the original address. True to the blockchain nature of the service, transactions were recorded on a transparent decentralized ledger, and bet results were provable to be mathematically fair.
At first look, SatoshiDice may seem to be nothing more than a quaint application of basic blockchain to a simple gambling game. This service nonetheless had important implications. Mere weeks after its launch, SatoshiDice drove BTC to an all-time high level of transactions. Through 2012 and 2013, SatoshiDice continued to account for a huge percentage of all BTC transaction volume – demonstrating a real world use case for cryptocurrency and helping to bootstrap a healthy blockchain ecosystem.
What’s the takeaway here? For a new cryptocurrency project to succeed, real world usage and adoption must be kick-started to overcome the first hurdle of user inertia. To a significant extent, SatoshiDice played this role for Bitcoin, and this strategy of using gambling to drive transaction volume of a cryptocurrency is underrated – perhaps it was initially an unintended consequence of SatoshiDice, but with hindsight this can be consciously applied to new projects.
One genre of blockchain that stands ready to benefit is Proof of Capacity projects, such as BXTB. As of early 2020, PoC is still somewhat under the radar of mainstream blockchain – though more and more observers are taking notice of PoC’s efficiency and myriad other advantages when compared to Proof of Work or Proof of Stake. Nonetheless, there are countless examples of superior technology failing to achieve adoption. Gambling can be the driver that is paired with superior technology – according to Juniper Research, the global online gambling industry is projected to handle betting volumes on the order of over $1 trillion by 2022. A properly positioned blockchain project stands to reap dramatic rewards in the field.
BXTB is following in the footsteps of BTC and SatoshiDice’s blueprint, by introducing BXTB’s own blockchain-based gambling game, driven by Proof of Capacity. While the scope of BXTB’s vision for the online gambling industry and Proof of Capacity extends to a much grander scale, it can’t be overlooked how much impact a simple blockchain-based game can have in driving the adoption of a new consensus algorithm that could truly bring cryptocurrency to the next generation.