You’ve got to get the scoop of something that’ll blow your mind. Ethereum, a popular blockchain network is a host to a “No Lose Lottery”.
In the most recent innovation by PoolTogether.us, people gather their money and buy lottery tickets, which gives them a chance to be drawn and win the “big” prize.
The best part about it is that if you don’t win, you get your money back!
I know, I know, sounds like a scam, or a cheap marketing trick. But you got to realize that the underlying technology that everyone’s been talking about and turning investor overnight, is a real thing. Ethereum’s blockchain is the biggest technological achievement of the 21st century and people are building awesome things on it.
In the second round of the “Crypto Lottery”, 435 unique Ethereum addresses participated(effectively 439 people) with 489 purchases and 2875 tickets were sold. The prize pool consisted of $57,500 in DAI, which will first go into a Compound protocol to accrue interest. The interest, which amounts to about $170 in DAI will go to one lucky winner on July 12th, 2019. Everyone else will get their full money back. Guaranteed by the programmable nature of money Ethereum enables.
So how does this work?
To understand how it works, you need to understand how Ethereum works. Ethereum is a decentralized smart contract platform and a blockchain. The smart contract part is the best thing about it, it just means that you can program certain processes and they run automatically when you interact with them.
Thus the lottery process at Pooltogether.us is fully “coded” to perform tasks of distributing tickets, collecting the money and rewarding the winner. The decentralized part is the answer to some worries you might be having right about now: “but how do I know I can trust this “website?”
Now listen to this, you don’t need to! The code runs on Ethereum’s “cloud” and can be verified by anyone since it’s in the public domain. You don’t send any money to anyone personally. You send it to this smart contract which is secured and verified by everyone participating in the Ethereum network. The way Ethereum works it spreads the smart contract all over the world on everyone’s computer or “nodes” so nobody can tamper with it. It’s in the public domain.
So the awesome programmers of Pooltogether.us have done all the necessary work and the smart contract has been reviewed by security officials and peers too. It’s good to go. It just works. You can see for yourself and verify it here.
Now to the “Can’t Lose” part.
Okay, as the heading says, now you’re probably wondering: “Wait, the lottery is a sucker’s game. The odds of winning are infinitesimally small.“ And you’re right. The odds of you winning is divided by the number of the participating tickets in the pool; increased by the number of tickets you have bought.
The way PoolTogether secures a prize for one winner is that it takes the pool money and puts it into another Ethereum protocol to earn interest over a short period of time.
The interest is the reward for the winner. Value is effectively generated by the pooled funds generating interest.
After the money that went into tickets accumulates enough interest, the leftover money is handed to the lucky winner who is randomly selected by the program. Everyone else who participated gets their money back to the wallet they have sent it from, for perhaps another try in the future.
Always, without a problem. It’s automatic, it’s smart contracts.
Economic incentive and possibilities
This is a simple application of a fundamental process. By pooling your money together, safely, without risk every time, you are saving that money since you don’t have access to it for a period of time. That’s a bonus already. Plus you get a chance every time to win some free cash. The rewards get bigger, the bigger the pool is. Just like the lottery.
I wonder what other kinds of possibilities are possible with a system like this. Value is generated by user’s funds, everyone’s a winner in the end. And none of that value is lost in the process since it is left in the hands of effective computer programming code.
https://twitter.com/sanneh_si/status/1144551423125925893?s=20
Ethereum offers “Open Finance” services where loans can be programmatically issued and taken by anyone with an Ethereum wallet.
Do not scoff at Ethereum, it’s the real deal.
Ethereum
I’d like to dedicate this monumental moment to share with everyone that Ethereum is the 2nd largest cryptocurrency by market cap for a reason. Millions of transactions are made on it day to day and the userbase is increasing every month. This example may just be a simple lottery game, but if you can understand the implications then I hope you will be as excited as I am for a better future this can bring us.
You can participate in the Ethereum economy and you can do a lot already. From games to serious financial processes. Earn interest, speculate, buy and trade collectibles and so much more. I’d love to share more with you, but I suggest you look into it yourself and join in on the exciting journey we’re about to embark.
You can check my other articles or learn more here: https://ethhub.io/
If you have any questions, feel free to leave me a message below, I will try to respond as soon as I can.
Ethereum is currently trading at $290, 76% down from January of 2018’s all-time high.
