While exploring projects on the blockchain through airdrops and bounty programs, which allow new supporters to earn a small number of coins by showing support, I came across what is described as prediction markets. Investopedia defines a prediction market as "a collection of people speculating on a variety of events — exchange averages, election results, commodity prices, quarterly sales results or even such things as gross movie receipts."
There are several blockchain-based prediction markets I recently learned about, including Augur, Gnosis, and Hivemind. Using Oracles, identical to what some betting platforms are using to manage bets, these prediction markets allow users to speculate on the outcome of anything, including sports.
Prediction platform STOX was able to convince me to try a prediction platform because of their primary focus on sports predictions. I received five non-withdrawable coins that I could begin to make predictions with.
At first, I didn't get how this was any different than a betting platform and how this added any value to a potential user. "You just make predictions, and if you're right you win stupid points called Brain Power (now called Ranking Power), and if you're wrong you lose your STOX, this is dumb," I thought. I misunderstood the platform (yes, I know, I should've read the whitepaper).
When it finally clicked, I was intrigued. STOX allows users to place a certain amount of STOX on a prediction. Like a bet, if more people bet against you, the more Ranking Power or coins you can win. Due to partnerships with companies and ICO's, certain predictions give you a chance at winning free coins to build a new portfolio with. Also, you never lose any of your STOX tokens. They are simply "locked" until the event begins, and then you are free to use them on another prediction.
Part of the reason I have been so engaged with this year's World Cup is because of a joint competition that STOX and Bet on Chart held to reward correct predictions with coins from both platforms. There is currently a Wimbledon competition where participants can win STOX and Iagon tokens for individual predictions on matches, and for finishing the competition on the leaderboard.
What Does This Mean for Betting Platforms and Scorum?
STOX, and other prediction platforms are far from a competitor of what Scorum will become in my opinion, or any other betting platform for that matter. Betting platforms, like Scorum's future commission-free offering, will allow users to risk their coins in exchange for a chance at large rewards in Scorum. On prediction platforms like STOX, you can use existing tokens to have an opportunity at winning a small number of different cryptocurrencies without risking your tokens. So in short, less risk than "betting," less to gain than betting.
This is also a much different format than fantasy sports, which allow you to choose individual players from a game to earn points. In most predictions, you simply choose the result, and after the result has been processed no the blockchain, the winners are rewarded. On STOX, however, there is a long wait to receive tokens won in your cryptocurrency wallet.
I have yet to purchase more STOX than the few I was gifted by signing up as an early user, but I have been able to gain a few coins by making correct predictions. I've now earned a few of the following coins:
- STOX (actual withdrawable tokens)
- Bet on Chart
I believe that prediction markets are a nice entry into betting for sports fans and cryptocurrency enthusiasts, especially in markets like the United States, which have had bans on online betting for quite some time. While they in no way offer the same rewards that a true betting platform can offer, they present little to no risk, which is appealing to those just getting started in this space.
What do you think of sports prediction platforms? Were you familiar with them before? Please comment below.
Note: This is not an endorsement of STOX or any prediction market, simply my overview of the space and my personal experience with it. I have not been paid to write this article.