Report: 6 Reasons Why We Are Bullish On BetProtocol
6 Reasons Why We Are Bullish On BetProtocol ($BEPRO)
At Coinvision we are always on the lookout for up-and-coming projects in the crypto and blockchain space that are making waves and building worthy technology. BetProtocol fits that profile, and in this post we are going to analyse why BetProtocol may be poised to out-do all other crypto-gambling projects, despite being a relative newcomer.
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TL ; DR
BetProtocol enables entrepreneurs to launch gambling platforms with no coding required. This is why we are bullish:
BitMax listing & $BEPRO Staking at 35% APR ; also trading on KuCoin
Esports betting (an industry with 38%+ CAGR) is launching on BetProtocol in Q3 of this year.
Project is revenue first and their product is already generating revenue
Live platforms are generating +150,000 USD daily betting volume
$BEPRO is used up as gas and needs to be repurchased constantly from exchanges. These tokens are locked for 2 years by the team.
4 active clients in mid 2020, 10 active clients in 2021
Outsized Partnerships with Chainlink, Matic Network, Ankr, Okex, Kucoin, and Elrond
Private-sale fully distributed despite recent token sale around 6 months ago
No new token unlocks in the next 12 months
The team has hinted at a “Tier 1 Exchange Listing” in Q3 — Q4 of this year.
1. BetProtocol’s Product & Vision
TKN.COM : BetProtocol’s first live real money casino
BetProtocol has a real working product that real customers are actually paying for. Right now.
Why is that so surprising in crypto?
They raised a reasonable $3M token sale and have 2 live casinos built on their tech within 6 months of completing the raise. Bravo for that, really. It’s a real accomplishment in this industry awash with vaporware from $35M+ raises from 2017.
The team says they have an additional 8 clients on-boarding that will also be live with casinos and Esports betting platforms in 2020. So far the team has a pretty solid track record of delivering on their promises, so there is a good chance that they will accomplish this number as well, or at least come close.
Online gambling sites on BetProtocol (so called “operators”) manage their sites using a back office management software that BetProtocol also provides. We have seen a demo of this software in action, and can say that it is sleek in its design and seems to function as advertised. The operator can manage their sites and make changes to announcements, handle deposits and withdrawals, and even nominate admins and collaborators with different permissions. All of this with no coding required, and indeed we did not see any instance where developer knowledge was needed to make changes to the back office.
BetProtocol’s vision is to enable ordinary folks with a limited budget to get their online gambling platforms up and running. This really reminds us of Tim Ferriss’ “Muse” businesses or Ramit Sethi’s “Side Hustle” start ups. All of this really smacks of the passive income culture of building your own thing, being your own boss, and being able to make money while sleeping / sipping mojitos on some beach in La Ciotat.
SaaS solutions such as Wordpress for blogs and Shopify for eCommerce businesses hve allowed this type of business to flourish. BetProtocol even bills itself as the “Shopify for betting apps,” which makes it pretty clear they are going for the same segment as the drop-shipping and Internet marketing crowd. Whereas those markets are quite crowded now and have to compete with giants like Amazon and Google for traction, the online gaming industry is largely untapped by young entrepreneurs of a new stripe.
The challenge for BetProtocol here is to be able to serve this new niche well enough to allow them to compete with incumbents and grab market share away from existing industry giants.
2. Live clients & an Expanding Market
Games.Bistox.com : BetProtocol’s 2nd live platform
The industry standard for token projects who have conducted a token sale is as follows : Go as deep and as fast in the red as possible, and spend a ton of money in an unsustainable way building technology in a vacuum. Paying clients, who needs them?
In stark contrast, BetProtocol seems to be betting big on business development and building platforms quickly. They have a business model and clear pricing that are accessible to entrepreneurs who have limited startup capital. The question that remains is can they also serve larger operators with thousands or even hundreds of thousands of users? Can they scale in the same manner as Shopify fast enough before industry giants notice them and react?
It is clear that blockchain and gambling go hand-in-hand. A macro consideration is the shift that is happening in traditional iGaming from normal fiat based systems to crypto and blockchain based systems. Our research speaking to online gambling industry pros confirms our suspicions: more and more traditional operators are looking to crypto and blockchain for initial research and development, and later on investment.
Demographics play a key role here too: over 87% of casino and online casino goers are in the Baby Boom generation. For obvious reasons they will not be able to gamble for much longer. Crypto and blockchain appeal far greater to the Millennial generation, which is now the largest demographic by sheer numbers.
What this means for BetProtocol is that they have the chance to grab early marketshare and brand awareness in an expanding market (online gaming is growing at 15%+ CAGR) that is shifting towards crypto-savvy Millennials. This could be a recipe for great success, and the timing is right.
TKN Esports Betting Sneak Peek
Whoa! Is that Twitch live streaming integration?
Esports betting is growing at a ridiculous 35% compound-annual-growth rate. That is insane. That means Esports betting is growing faster than Esports revenues (25% CAGR) itself.
The sneak peaks that Coinvision has seen of BetProtocol’s Esports betting technology have left us very impressed. Among other features, you’ll be able to bet on CS:GO, League of Legends, Overwatch, PUBG, and Dota 2 while watching live streaming matches at the same time.
The first iteration will be for fixed pre-match betting, but the team says in their roadmap that they will release in-play betting with live odds later on in the year or early next year.
With the global COVID-19 situation and traditional sports sidelined for the foreseeable future, this push for Esports seems to be a smart business move. Of the other competitors BetProtocol has in the blockchain space (FunFair, DaoCasino, Wink) none of them are doing anything with Esports. That seems to be a big mistake that BetProtocol is taking advantage of. If those competitors are not quick on the ball (virtual one that is) they may see themselves left behind as BetProtocol surpasses them in this very hot and fast growing market.
For a company that is sporting a $2M marketcap, they have some pretty out-sized partnerships. The headliner here is Matic Network of course, whom BetProtocol did conduct a private sale placement with during their token raise. We assume that the teams are close. Matic is a Binance IEO project.
Ankr is another partner, and are providing decentralised server and cloud architecture for BetProtocol. Ankr is listed on Binance.
Elrond Network recently announced a partnership with BetProtocol. They will serve as a decentralised backup for gaming and compliance data. Elrond Network is a Binance IEO project.
Are you starting to see a trend here?
Binance is clearly OK with online gambling: IEO with Wink, close ties to TRON and now a partnership with this Bplay (not related with BetProtocol). Comparing TKN.COM with Bplay we can say that they are pretty on par with each other in terms of design, with BetProtocol having the slight edge on looks. Games on TKN have a simple, almost minimalistic vibe to them; while games on Bplay have that traditional old-school online casino feel.
The on-boarding process for both platforms was smooth when going through the new sign-up via email process, but Bplay has the added Continue with Binance feature. We were ultimately disappointed by this since all it does is log you in to Bplay with the same credentials as your Binance account, but you still had to manually deposit funds. You couldn’t for example gamble directly with your exchange deposits, which would be cool.
But we digress, there is clearly a lot to be done in the blockchain online gambling space, and both BetProtocol and Binance are betting that it’ll be a big market in the future. We may even see them collaborate on a platform, but that is just speculation at this point.
The BetProtocol team have declined to comment on a future partnership with Binance for a gambling platform and listing for $BEPRO.
5. $BEPRO Tokens as gas (and locked for 2 years)
The token economy of BetProtocol’s $BEPRO token was one of the things that got us interested in the first place. $BEPRO tokens are used as gas to cover betting volume. The team says that it charges 0.5% of total betting volume across all BetProtocol gambling dapps in $BEPRO. Or in other words, if there were a total of $100,000,000 in gaming volume across all their operators in a month, those operators would owe BetProtocol, in aggregate, $500,000 worth of $BEPRO tokens that month.
Why is this a big deal?
Because this happens in perpetuity, and there’s only one place to get $BEPRO tokens: exchanges. So as operators have betting volume they are constantly generating their own demand for $BEPRO tokens. The more betting volume they have the faster they burn through their supply, and they need to buy more. This kind of guaranteed buy pressure on the market that each operator represents is what powers token network effects.
Each new client that launches on BetProtocol is a bullish event for $BEPRO token valuation because of this gas mechanism. Now, throw in a 2 year lock on $BEPRO tokens spent as gas that BetProtocol receives from operators, and you now have a situation of increasing demand and diminishing supply. Basic economics demand that the price will have to rise.
The big news for $BEPRO this week is their announcement of BitMax listing and staking. Listing on BitMax isn’t huge news in and of itself, however the addition of staking is — especially for investors and token holders. Previous projects on BitMax that went live with staking did very well with significant price appreciation post-staking. Most recently, xDai is an example of a token that went 6.4x after staking started on BitMax.
Staking of course is a dog-whistle of sorts for the crypto community. Everyone rolls their eyes, but ends up joining in on the staking fun anyways. One thing is clear: staking increases demand for the token while locking up supply. That’s good for the price, and that’s why it generates so much interest.
For $BEPRO, staking allows operators to acquire a large stake of tokens for future gas use, and to be able to do so now while shielding them from future price fluctuations. The stake rewards effectively reduce the cost basis of their purchase over time, which is essentially dollar-cost-averaging in reverse. Investors can do the same, and in fact like in the case of xDai, we may see that a large percentage of the network ends up getting staked for this reason.
If a large percentage of $BEPRO is locked up in BitMax staking, while operators are live and spending $BEPRO as gas (which will also be locked for 2 years) we can see a scenario of rapid price appreciation — if the demand side for $BEPRO on the secondary markets keeps up. This demand of course is dependent on the number of operators and their overall betting volume. In general, if you see BetProtocol adding live clients to their roster that is a bullish sign for this token.
$BEPRO Potential Upside
Funfair, DaoCasino, Wink are some of BetProtocol competitors. While all of them have consumer facing applications, BetProtocol is focused on being a Software As A Service for enterprises and entrepreneurs.
In other words, BetProtocol can build an infinite amount of betting platforms that will compete with these projects. BetProtocol technology is more updated, more scalable and reliable than these projects, but the current market cap doesn’t reflect the reality.
Let’s give it a quick look on why we believe in the huge $BEPRO potential:
BetProtocol ($BEPRO) current market cap: $2.8M
WINk (WIN$) current market cap: $24.4M
FunFair (FUN$) current market cap: $24.6M
So just by analysing the most direct competitors, BetProtocol ($BEPRO) still has a close to 10x upside potential. And for instance, if we revisit the FunFair (FUN$) all time high market cap of $788M during 2017 bull market, we are looking at a very positive outlook for BetProtocol on the next bull cycle.
So that’s it for our first Alt Coin Report of 2020. Let us know your thoughts and the comment section!