Detractors of blockchain technology often label investing in the nascent industry as gambling. Now, ironically, one of the biggest growth areas in blockchain technology is just that: gambling.
After raising more than $4 billion in token distribution, EOS has surpassed ethereum as the most active blockchain, accounting for around half of all U.S. dollar-traded volume on dApps, thanks in part to developers of decentralized gambling apps, according to blockchain analytics firm Diar research.
“As of January this year, to date, EOS dApps are accounting for 55% [and] Tron 38%, leaving ethereum applications with a mere 6% of total on-chain USD volume. But there is a clear group levitating towards the two new blockchains — gamblers. Of the $5.5 billion already transacted on EOS, 70% go towards gambling dApps. This number is over 95% for Tron,” Diar said.
A dApp is a decentralized application that runs on a blockchain, unlike conventional apps, which run on a computer system.
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One of the more popular gambling dApps is TronDice that runs on the Tron blockchain. Players select a number between 1 and 100 and bet whether they think the random number the program generates will be higher or lower than the number they selected. The odds are determined by the probability of your selection.
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So why the surge in popularity? “There’s no KYC (know your customer), there’s no regulation,” said Fadi Aboualfa, head of research at Diar. “People can flip dice, gamble and are shifting value, but in tokens.”
But it’s not without its risks, says Aboualfa. “Some exchanges are suspending and blacklisting accounts if they find users’ tokens have been shifted through gambling dApps,” he said.
However, transaction volume data suggests the number of crackdowns are minimal. In early December, the Tron Foundation said the dApp surpassed 1 million transactions in a 24 hour period, and according to data from CoinMarketCap, the 24-hour volume of TRON, the coin that underpins the Tron blockchain, is greater than $220 million, up from $60 million at the beginning of the year.
So while the crypto bear market rolls on, blockchain usage continues to climb, thanks in part to punters, but not necessarily the ones betting on the price of cryptocurrencies like bitcoin,
It’s instead those wagering on the roll of a dice or the generation of a random number.
“It’s easy, it’s fun and people are making money,” said Aboualfa.
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