LOTEO — Digital Era Lottery

4 min readJul 18, 2019

Global lottery

Online lotteries are an established industry, having existed in some form since at least 19975. The global online lottery market is estimated to reach revenues of more than $10 billion by 2023, growing at a CAGR of around 8% between 2019–2023.

Future outlook

Global trends such as the long term increase of mobile phone penetration, internet penetration and the proliferation of blockchain technologies will provide ideal conditions for the growth of the online gambling market, including the online lottery industry.

Growth will be driven by the rise of draw-based games and scratch-off instant games across European countries as well as other developed regions. The increasing focus on investment in new technologies (including blockchain), improving the perception of lotteries, and reaching far-away audiences via the internet will propel the transformation of the market.

Current issues

Lotteries, like any form of gambling, can be manipulated against its participants, despite the high degree of scrutiny claimed by the organizers. Due to the high degree of centralization, organizers wield a considerable amount of power that is liable to abuse due to the current lack of transparency in lotteries. Even without manipulation, lotteries are profitable for organizers, with many claiming a profit margin of up to 50% on ticket sales.

Opportunities

Global drivers such as increased internet penetration, mobile and PC ownership, and the increased adoption of cryptocurrencies9 point towards greater demand for all-digital lotteries that overcomes current customer issues such as lack of trust and requirements for personal information.

Blockchain technology can not only provide a secure and transparent method of organizing the lottery, but it can also tap into new market segments, most notably the global unbanked customer segment as well as regional markets with restrictive legislation. A lottery based on smart contracts would offer an automated, secure and transparent platform for this form of gambling.

What is loteo?

Loteo is digital automated lottery platform that uses blockchain and smart contracts to create a fully transparent lottery, where your chances are incomparably higher compared to conventional lotteries. LOTES is a security token which is meant to be sold only in private funding round (the STO). There will not be any public sale, for all investment requirements, please fill the form on the website. This token grants owners an opportunity to profit from being part of a lottery without being attendees in amount 20% of each prize total value. The LOTES are locked for 15 months and during this time it is not possible to buy or sell them anywhere else. After the first 15 months pass, there will be another funding round during which LOTEO will sell at least 30% of all tokens in compliance with legal and regulatory requirements. All details will be revealed before this event. After selling these tokens, the token will be listed on exchanges. After 15 months,maximum 20% of all security tokens will be owned by the lottery while 80% will be decentralized, preventing the lottery from being manipulated. The token also has a governing function, meaning any significant change has to be achieved by consensus and any token holder can issue a suggestion or voting.

How does the lottery work?

Users enter the lottery by purchasing single tickets for the LOTEO weekly lottery using the Ethereum cryptocurrency, or through a third party merchant. Each Ethereum wallet address that has purchased entry is then registered as a participant in the LOTEO weekly lottery. At a later date, LOTEO will add a daily lottery governed by the same rules.

The LOTEO lottery will be executed through a smart contract that will utilize a random number generator (RNG), the code of which will be publically viewable on GitHub and Etherscan. The pool for drawing consists only of lottery tickets (based on the Ethereum addresses of the entrees) instead of drawing random numbers, therefore every drawing must have a winner.

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