By Victor Agreda
As blockchain games continue to grow in popularity, a few new entries are shooting up to the top of the charts on State of the Dapps but the top 20 is dominated by three categories: decentralized exchanges (e.g., IDEX and ForkDelta), crypto-collectibles (e.g., Etheremon, CrytpoKitties) and gambling. Gambling could be a generous term for this new twist on an even older model – pyramid schemes.
As of today, the recently launched Zethr has joined Fomo3D and PoWH (P3D) as gambling Dapps at the top-10 of all decentralized applications in terms of average daily users, and may join them as leaders in the more representative monthly users stats once it is actually a month old.
All three projects appear to be taking advantage of many cryptocurrency traders’ instinct to gamble as opposed to invest for the long term. Whether or not you believe these projects are scams, it is undeniable that they have gained traction.
Zethr has been compared to PoWH (P3D), which describes its economic concept as “self-removal from pareto optimality where there is no longer a way for an allocation of resources to improve without harming a participant of the model.” With PoWH, some of the buys and sells are put in a pool and are then distributed among those who buy the tokens. But with Zethr, you’re able to set what buy-in and sell percentage you want. The contract will take an average and as the website states: “You can choose between seven different dividend rates, ranging from 2% up to 33%.”
Zethr claims to be a gambling game, but one where you play the casino. Yet, it appears that the real “gamble” is knowing when to get out – which is always the key to profiting in a “pyramid scheme”. In this case, people know that HODLing is the best approach in the medium-term, but just don’t know how long that time period is.
The Zethr team is going to great pains to attract new players by using “fair scaling” – essentially a way to even out investors that show up early and those who may be late to the game. No one will have a majority of its tokens, and Zethr (ZTH) uses an inverse-square relationship between ether invested and token price. Zethr has a value floor, as a way to protect investors.
The creators of PoWH and FOMO3D are less earnest about their intentions and appear surprised by the success of the Dapps. On its website, PoWH admit that their project is an “an obviously tongue-in-cheek joke about the state of cryptocurrency as a whole, the sad state of ICOs that promise everything while the Ethereum they are given vanishes into wallets never to be seen again…that said, ironically our token is a fully functioning product.
The whitepaper for ZTH refers to a “gambling-powered-dividend-pyramid” and it is still in the process of rolling out all aspects of this rather ambitious play. In particular, it’s somewhat unclear if the pyramid has gone live, although dividend cards were live in May. Those are a curious notion, as you can buy in at certain payouts, but you don’t get to decide how long you hold the cards.
ZTH had its initial token generation even on August 1, 2018, and the dev account has been pretty quiet since then. Volume has been fairly robust, and despite a small dip, appears to be growing stronger.
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