Cyprus-based blockchain start-up Firelotto plans to disrupt online lottery market with their blockchain-powered lottery. They have a ready product, and have already started 4 online lottery games, with the initial guaranteed prize pool exceeding US $ 1 million.
Lottery market is massive. According to a report, in the USA, lottery sales were US $ 80.55 billion in 2016, while in the European Union (EU), it was Euro 47.894 billion in the same year. By 2018, the online lottery market is expected to grow to US $ 65 billion.
Questions have often been raised whether the lottery was conducted truly with random numbers, or whether a real person actually own the jackpot, or even whether the money really did accumulate in one pool? In summary, are the lotteries ensuring fair play?
Firelotto answers all of these with their blockchain-powered lottery. Blockchain ensures decentralization by design, and in this decentralized database, computers on the network, called ‘nodes’, maintain a shared version of truth. Anyone can join a permission-less blockchain, which is what Firelotto is using, and every node has complete and latest information on such a blockchain. The system can’t be destroyed by taking out any central server. Block records, also called ‘blocks’, are linked via a predetermined protocol. No existing block can be deleted or modified. Adding a new block is the only way to update a blockchain, which, in a permission-less blockchain, can be done by any node, and there is no need to route updates through any centralized authority. Maintaining the order of transactions is important, to maintain data integrity, and blockchain does that with consensus mechanism. If the consensus mechanism uses proof of work (POW) algorithm, then the majority of all participating nodes have to validate a transaction. On the other hand, in proof of stake (PoS) algorithm, there are nodes that stake their crypto tokens for transaction validation, and majority of these nodes have to approve a transaction. Either way, a new block can be added only after significant number-crunching done at high-speed, requiring very significant computing power. Such rigor makes it economically non-viable to hack blockchain, providing for security.
Firelotto‘s lottery is built on Ethereum blockchain, and the random number generator is based on Bitcoin-like blockchain technology, and it’s possible to tamper it. The lottery parameters are releases in open source, on GitHub, ensuring complete transparency. Decentralized platform provides for autonomy. The lottery runs on both mobile and PC. There are currently 4 popular lottery games are available, including Roger’s wheel and three draw lotteries: 4 of 20, 5 of 36, and 6 of 45. Tickets are as cheap as US $ 2. The prize pool of more than US $ 1 million is funded by ticket sales and guaranteed fund. Prizes are automatically transferred to the winner’s cryptocurrency wallets.
Firelotto has been founded by a group of Russian entrepreneurs. The Initial Coin Offering (ICO) for their crypto token FLOT has started on March 15th with hard cap of US $ 2 million and hard cap of US $ 15 million. FLOT will listed on exchanges in May 2018.