Minimum Breeding Price and Allocation.
We are delighted to announce that ZED will be launching the stud and breeding marketplace very soon.
This article will contain the parameters that surround how the minimum breeding will be calculated and allocated. As you may be aware, breeding a real racehorse and raising a foal to a yearling is expensive with many associated costs related to vet fees, feed, transport and more.
The minimum breeding price is designed to reflect these costs, maintain value in the existing population of racehorses and importantly, create future value.
These costs create a barrier to entry for breeders even if they own both the Dam (Mother) and Sire (Father). The minimum breeding price is designed to reflect these costs, maintain value in the existing horses, and create future value.
The ZED Team have appointed an Actuary with gaming experience to assist in understanding the multitude of scenarios that could result from breeding and the minimum breeding price. Whilst we have settled on a balance we feel delivers the best outcome in the early stages of the game, we can not fully predict all the variables that may transpire (many of which are subject to player activity and response). Accordingly, ZED reserves the right to adjust these calculations in the future to ensure that the principles and economics behind the game are upheld.
This article will be broken up in the following sections:
1. Minimum breeding prices
- Base Breeding Price
- Bloodline of Sire
- Breed Type and Genotype of Sire
- Duration in Stud
- Public versus private breeding
- Breeding with your own stable
- The future of private breeding
- Cool down periods
2. Breeding limits
3. What offspring gender will I create?
4. Allocation of the Breeding Price
5. Calculation Example
Minimum Breeding Prices.
The most expensive ZED racehorses sold privately, at the time of this article, was a Z1 Nakamoto named Satoshi. Satoshi was sold in a bundle with four other Z1’s for a total value of 43 ETH.
Other notable sales include another Z1 racehorse named Cristiano Ronaldo for 7 ETH; a very handsome profit indeed given that this horse’s value during the early release was 0.4 ETH.
What made Cristiano Ronaldo and all these expensive racehorses so special you may ask? Good question. It may have been the name it associated with the racehorse itself, the colour, the breed type, the bloodline or even the gender. What is indisputable however, is that the inherent nature of anything collectible (whether it is digital or physical in nature) is that it has the capacity to mean something to someone.
Therefore, it is critical that we set boundaries around the breeding economy to ensure that the racehorses you have previously purchased are not devalued as the ecosystem grows.
This can be particularly challenging in a rapidly growing ecosystem which has many players with different game budgets. Not dissimilar to traditional horse racing, it is natural that racehorses will fetch different prices with some being high, and others being lower. The performance and attributes of these horses will also vary, which mostly, but not always, will reflect in their racing performance.
Therefore, to ensure accessibility to the game and maintaining racehorse value, we have introduced a minimum breeding price.
If ZED was to remove the minimum breeding price, breeding would occur more frequently at a lower price, therefore devaluing the current stock of racehorses.
We have carefully developed the minimum breeding price to reflect the elements of the game and possible outcomes. We do however reserve the right to adjust these calculations in the future to ensure that the principles behind the game are upheld and also in the event of major fluctuations in the price of ETH.
It is crucial to note that the minimum breeding price will always be determined based off the male racehorse. Minimum breeding prices are only a guide and male racehorse owners can set the price as high as they wish after factoring in coat colour, ancestral traits and past performance.
Minimum breeding prices are based on the following combination of factors:
- Base Breeding Price
- Bloodline of Sire
- Breed type / Genotype of Sire
- Duration in the stud
- Breeding within your own stable
Base Breeding Price.
This is a nominal price that is included in the minimum breeding price calculation. Currently, the base breeding price is set to 0.4 ETH.
This does not mean the minimum breeding price is 0.4 ETH, rather it acts as the base to determine what the final breeding price will be depending on bloodline, breed type and the duration that sire is in the stud farm for. Minimum breeding prices will vary well below and well above the base breeding price of 0.4 ETH.
Bloodline of a sire.
Existing players of ZED are aware of the differences in bloodlines. For a refresher, check out our two-part guide here and here.
To preserve the value of bloodlines, rarer bloodlines such as the Nakamoto will be more expensive to breed than the more common Finney and Buterin bloodlines.
Bloodlines will contribute 80% to the overall weighting factor when determining the minimum breeding price. Subsequently, each individual bloodline is weighted as follows:
- Nakamoto: 180%
- Szabo: 120%
- Finney: 40%
- Buterin: 15%
Based on what bloodline your male racehorse embodies will essentially play a major role in setting the minimum breeding price that you can set.
Breed types of the sire.
Breed type is a hierarchy system that is used to broadly reflect genotype. Genotypes refer to how far away a racehorse is from its ancestors. You can read more about ZED genotypes here. All early release racehorses (i.e. Z1 to Z10) are defined as a Genesis Breed; the purest breed of all which cannot be reproduced. The Genesis breed are the racehorses sold by ZED.
From the table below, it can be seen that the Legendary, Exclusive and Elite breed types are the rarest breeding outcomes.
Breeding with the top tier breed types will naturally also attract a higher minimum breeding price.
Breed types account for 20% of the total weighting when calculating the minimum breeding price. Each breed type is weighted as follows:
- Genesis: 180%
- Legendary: 150%
- Exclusive: 120%
- Elite: 90%
- Cross: 80%
- Pacer: 60%
Just as with bloodlines, depending on what breed type your male racehorse has will also play a role in setting the minimum breeding price that you can set.
Duration in the Stud.
Players can choose how long they wish to have their racehorse in the stud, with duration limits set to 1, 3 and 7 days.
It is important to know that whilst your male racehorse is in the stud farm, it cannot be taken out of the stud farm and it cannot participate in races; you cannot be in two places at the same time! This also provides the opportunity for other players to breed with more sought after racehorses.
The duration of your racehorse in the stud farm will not impact the minimum breeding price, however it will affect how much money you will make. The longer you leave your racehorse in the stud farm for, the greater the amount of the breeding fee will be allocated to you.
Therefore, a greater percentage of the breeding fee will be allocated to the stable owner the longer their racehorse is left in the stud:
- 1 day: stud owner will receive 24% of the breeding fee set
- 3 days: stud owner will receive 30% of the breeding fee set
- 7 days : stud owner will receive 36% of the breeding fee set
Therefore, the stud owner’s allocation of the breeding fee can increase by 50% by leaving its colt or stallion in the stud farm for 7 days as opposed to 1 day. ZED encourages players to be strategic when placing their racehorse into the stud farm as you do not want too many stables breeding with your winning racehorse!
Public versus private breeding.
The ZED stud marketplace will open with a public breeding format to support the cross-pollination of the ecosystem. We have carefully thought this through and there is a good reason why private breeding is not yet available. The game theory behind the early-stage public breeding program has been designed to encourage open and transparent activity for all owners to participate in fair opportunities.
From the very beginning, we have been vocal about building a community-first platform. As such, we see public breeding as a great touch point for players to build their network and engage with other stable owners.
We are by no means saying that there is anything wrong with private breeding, however, to release public breeding first, makes a lot of sense.
For those who are adamant about the importance of private breeding, we do hear you and we are already one step ahead. Private breeding is coming, sit tight if you can muster the wait.
Breeding within your own stable.
To breed with your own racehorse still requires you to place your horse in the stud farm, set a minimum price and select the duration of your stay. If you choose to breed within your own stable, the minimum breeding price you have set will be automatically discounted by 35%. The majority of funds collected here by ZED will contribute to the racing prize pools when racing commences.
The reason ZED places a fee on breeding with your own stable is that it prevents players from over breeding cheaply and consequently devaluing the stock of horses within the ZED ecosystem (i.e. if you can breed a Z2 for less than it costs to buy a Z2 from the marketplace or early release, then there is no incentive to buy these horses).
The future of private breeding.
Whilst breeding with your own stable will require you to make your horse available to the public to breed within the first version, an update to the stud farm will be made in the near future to allow private breeding. The future private breeding function will allow breeding within your own stable without making the Stallion available to others to breed with. It will however not include the opportunity to restrict the breeding to another stable that is not your own.
Cool down periods.
There are no cool-down periods in ZED because we have introduced breeding limits on both the male and female racehorses.
Breeding limits.
To ensure the surplus of newborn racehorse does not devalue the market value of other racehorses in the ecosystem, we have refined the breeding limits.
The new breeding limits define how many times a male and a female racehorse can breed per month. A male racehorse can breed 7 times per month (84 time per year) and female racehorses can breed 2 times per month (24 times per year).
ZED may consider adjusting theses breeding limits in line with the communities concerns or in the case of unforeseen fluctuations that could potentially impact the ecosystem disproportionately.
What offspring gender will I create?
The gender of each offspring that is born will be generated at random.
Allocation of the breeding price.
Careful consideration has been given towards where the funds should be allocated to that are derived from breeding. We have been mindful to balance the return on investment of players in each racehorse, together with the development of the ecosystem as a whole.
Three key areas exist which need investment in order to grow ZED. These are;
- broad marketing
- world class game functionality
- race prize pools
Traditional racing develops their prize pools from funds allocated by gaming license holders. ZED currently does not have this privilege, however, we do have access to other funding opportunities of these prize pools. The first that we are making public is the allocation of a significant amount of the stud farm fees will be allocated towards these prize pools.
As custodians of the game, ZED is determined to ensure that continued investment is adequately placed into each of these areas. Accordingly, the following allocation of the breeding price have been determined:
To put the allocation of this breeding fee into perspective, a stallion or colt can breed up to 84 times per year, and therefore it could earn many stud fees providing a return on investment in excess of its purchase price very quickly. A Mare, on the other hand, can breed up to 24 times per year and needs to be mindful of the colt or stallion it is breeding with and the resulting market price its offspring may achieve. Therefore the owner of the filly or mare will seek an appropriate breeding fee to ensure that the risk in the outcome of the foals attributes (in particular colour coat and racing attributes) are accounted for and ensure that appropriate profit is achievable from racing, future breeding or a market place sale. We anticipate this will result in healthy growth in the ZED ecosystem in new users, new horses and attractive race prize pools.
We intend to review these allocations on a quarterly basis to ensure that these allocations remain appropriate as the game evolves.
Calculation Examples
There are many variances with the breeding possibilities however we have compiled the following 3 examples to illustrate the calculation using the formula:
Base Price (i.e. 0.40 ETH) x {[Bloodline Weighting x 80%] + [Breed Type Weighting x 20%]} x Breeding With Your Own Stable Discount (if applicable)
Example A — Sire is a Nakamoto, Z1 (therefore Genesis) which breeds with someone else’s stable and is in the stud farm for 3 days.
Minimum Breeding Price = Base Price (i.e. 0.40 ETH) x {[Bloodline Weighting x 80%] + [Breed Type Weighting x 20%]} x Breeding With Your Own Stable Discount (if applicable)
= 0.40 ETH x {[180% x 80%] + [180% x 20%]}
=0.40 ETH x {[1.8 x 0.80] + [1.8 x 0.20]}
= 0.72 ETH
Of the above fee (if the stud owner choses to set his breeding price at the minimum price calculated by ZED, the allocation of the funds will be as follows:
- Prize Pool: 50%
- Stud Owner: 30%
- ZED Fee: 20%
Using the above example, if the stud owner wishes to breed within their own stable, a 35% discount will automatically be applied, bringing the price down to 0.468 ETH.
Example B — Sire is a Buterin, Z20 (likely Exclusive) breeds from within your own stable and is in the Stud for 7 days.
Minimum Breeding Price = Base Price (i.e. 0.40 ETH) x {[Bloodline Weighting x 80%] + [Breed Type Weighting x 20%]} x Breeding With Your Own Stable Discount (if applicable)
= 0.40 ETH x {[15% x 80%] + [120% x 20%]} x 65%
=0.40 ETH x {[0.15 x 0.80] + [1.2 x 0.20]} x 0.65
= 0.0936 ETH
Of the above fee (if the stud owner choses to set his breeding price at the minimum price calculated by ZED, the allocation of the funds will be as follows:
- Prize Pool: 60%
- Stud Owner: 0%
- ZED Fee: 40%
Example C — Sire is a Szabo, Z20 (likely Elite) breeds from someone else’s stable and is in the Stud for 1 day.
Minimum Breeding Price = Base Price (i.e. 0.40 ETH) x {[Bloodline Weighting x 80%] + [Breed Type Weighting x 20%]} x Breeding With Your Own Stable Discount (if applicable)
= 0.40 ETH x {[120% x 80%] + [90% x 20%]}
= 0.40 ETH x {[1.2 x 0.80] + [0.90 x 0.20]}
= 0.456 ETH
Of the above fee (if the stud owner choses to set his breeding price at the minimum price calculated by ZED, the allocation of the funds will be as follows:
- Prize Pool: 50%
- Stud Owner: 30%
- ZED Fee: 20%
Disclaimer
ZED Run reserves the right to adjust aspects of the game without notice to preserve the principles and economics behind the game. Elements of the game may be adjusted to maintain the value of the racehorses in the ecosystem and the accessibility of future players. Subsequently, ZED employs dynamic algorithms to appropriately manage these aspects of the game.
Furthermore, we are aware that the base currency of the ecosystem is Ethereum which is subject to significant price volatility.
Conclusion
Our main pillar of guidance when determining our minimum breeding prices was to protect every player’s investment in ZED, not just for now but for the future as the ecosystem begins to grow.
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