Why We Are Betting on the Blockchain, Interview With Azuro’s Paruyr Shahbazyan
24 Noviembre 2021 - 9:57PM
NEWSBTC
Online betting, which has always been popular since its inception,
saw a dramatic explosion following the start of the pandemic.
People desperate for entertainment, when outdoor leisure and
sporting events were closed, turned to online forms of
entertainment. Online betting was one of the beneficiaries of this
new trend with the sector having grown from **$465.76 billion in
2020, to $516.03 billion in 2021, and the market is expected to
climb to $674.7 billion in 2025. However, ask any seasoned online
gamer or bettor and they will likely tell you that betting online
comes with a host of problems and frustrations for them. These
include the lack of transparency and fluctuations of fixed betting
odds, bet settlement delays and even winning bettors having
their accounts limited due to the success they have enjoyed. For
these reasons alone, it makes a lot of sense to migrate betting
onto the blockchain. The blockchain, using smart contracts and
sometimes oracles, automates the entire betting process and the
money flow, that way the funnel is entirely un-manipulatable and
transparent. This means that users are paid out automatically, it
means they cannot have their accounts limited just for winning too
much, and it also means their personal and banking data is not
exposed to hackers. The blockchain automatically verifies transfers
and activities and it keeps this data on thousands of nodes
worldwide, giving hackers limited opportunity to steal their data
from a single company server. As users are depositing with their
wallet address and not their credit card, this keeps the entire
process of betting anonymous, and also means that the user does not
need to jump through the hoops of due diligence when onboarding.
KYC for an online casino is a process that consumes a lot of
manpower and energy, it also sees a large chunk of registrants
dropping out before they even complete the process due to its
complexities. Take away the KYC, the storing of a user’s credit
card data and personal data, and give no chance for the casino to
manipulate odds or delay withdrawals, and you have a winning
combination. We spoke to Paruyr Shahbazyan, the co-founder and CEO
of Azuro, a blockchain-based betting protocol tackling all of the
problems of centralized betting. He describes the benefits of the
blockchain in this capacity best. “The usage of blockchain as
a base infrastructure for betting will add more value and fairness
for the betting industry. First of all, blockchain brings full
transparency where all transactions and parties are visible. As
said previously that’s great for the players, but not only! It also
solves other problems in the traditional betting industry like for
example “affiliate shaving”. Centralized betting operators often
stop paying commissions to their partners (called affiliates) which
refer new bettors to the bookmakers. The phenomenon is called
“affiliate shaving” and it basically happens because affiliates
have 0 visibility of what happens on the bookmaker side and if the
players they have referred to bookmakers are active or not, and so
forth.” “Blockchain is solving this issue. The bettor is
represented by a crypto address. And you can easily see whether a
given address is interacting with Azuro’s smart contracts or not.
Plus the affiliate commission is set in the smart contract and
cannot be changed. This means that the affiliate will get a
guaranteed lifetime commission for all of the bettors’ activity
that he provides. No more “affiliate shaving”!” “In addition,
blockchain allows for betting to happen without players having to
give their money to a 3rd party which can do with the money as they
please. This is possible because, on the blockchain, betting
happens with the bettors’ funds placed in smart contracts (which
pay out winnings automatically and immediately). On the contrary –
currently (and without blockchain) players’ money is deposited with
the bookmakers and the bookmakers decide when and if to pay-out
winnings… Which often results in delayed or declined pay-outs.” Q:
Can you give some insight into how Azuro helps bettors and gaming
sites? A: Users can bet with Azuro in a trustless way. No one can
influence how Azuro’s smart contracts will resolve. Plus we are
democratizing the business of betting as a whole. It is well known
that the betting industry is very capital and know-how intensive
with high barriers to entry. With Azuro, we are breaking down the
role of a betting operator into several smaller roles, making it
available to anyone who wants to benefit from liquidity and data
provision, front-end development and operation, and decentralized
governance. This means more value is shared with more participants
in the ecosystem. Plus, we have a commitment to social
responsibility from the very beginning that is unique to our
project. Q: A major benefit of blockchain projects like Azuro is
that they can really solve problems. What problems does Azuro aim
to solve? A: First of all, Azuro is a global decentralized betting
protocol, utilizing smart-contracts to bring full transparency to
the betting process while delivering a classic betting experience
with plentiful markets and liquidity. The core goal is to give
bettors a trustless alternative to betting, which is on par with
the experience they can get with traditional bookmakers. As we do
that, we remove the issues with trust and transparency between
players and operators prevalent today. Azuro uses blockchain
technology that allows for decentralization and the democratization
of the betting business. Azuro breaks down the role of a bookmaker
into several smaller roles openly available for anyone to benefit
from liquidity provision, front-end management, data provision and
decentralized governance. This means more value is shared with more
participants in the ecosystem. Plus, we have a commitment to social
responsibility from the very beginning that is unique to our
project. Q: It seems that you came into this industry with very
personal and real frustrations from your own experience. Can you
tell us about those? A: That’s right. I was a professional sports
arbitrage player for nearly 10 years back in the day. As
such, – I can assure you that the betting industry
lacks fairness and transparency! The reason is the system built on
negative incentives which put bookmakers and players against each
other. Players and betting operators do not trust each other, smart
players are being blocked, etc.. I got banned by many bookmakers
and I couldn’t get my winnings out from many of them, too. These
problems have created a niche for my own business – Bookmaker
Ratings, which I started about 10 years ago, almost as an act of
revenge because of my experiences as a player… Q: You founded a
real landmark website, Bookmaker Ratings, that serves as an
intermediary between players and betting sites. How does that work?
A: I started Bookmaker Ratings, which is the biggest online
media about sports betting in Eastern Europe. The business focused
on a simple thing: the lack of trust between players and
bookmakers. So, we were objective in our ratings and did whatever
we could to help players mainly by acting as an intermediary and
resolving disputes between the two sides. Through this, we managed
to have more than $12 million returned to players over the years,
which ensured we gained people’s trust. This was all possible
because we were driven by a deep understanding of the players’
problems. Q: Where do you see the future of the blockchain for
gamification going? A: We can see how other traditional
industries like finance, data storage, content generation etc. got
promoted and improved through blockchain decentralization. In the
case of betting, the traditional betting market we have right now
(including the billions of bettors) might need some time to adapt
and migrate onto blockchain. As this happens though – the full
power of decentralization will completely disrupt the betting
industry and provide transparent and efficient betting to everyone.
Initially, the biggest portion of users will be a mix of
traditional bettors who are more tech-savvy and have tried or are
open to try blockchain applications and crypto native users who are
enjoying new ways to benefit from blockchain betting like farming,
liquidity provision and staking, as will be possible when Azuro
Protocol’s mainnet is live. Q: What other themes should we be
paying attention to going into 2022? A: I would like to mention
NFTs and the way they might impact betting as well. In my
opinion, NFT technology allows for true innovation that will enrich
the betting experience dramatically, in a positive way. We create
the opportunity for secondary markets (bet cash-out or purchase
with a discount, markets for memorable bets as collectibles) and
lots of engaging gamification that turn the usual betting
experience into something more engaging and exciting. Thus, each
bet on Azuro is an NFT and it has two functions. Until the moment
of settlement of the bet, it is a financial NFT. It can be traded
on our marketplace. Let’s say you have placed a bet and for
whatever reason you decide that you do not want it to play out (you
want to cash out before the event is played). You can sell it on
our marketplace. And the buyer gets your bet with a bit of a
discount, thus getting an edge in terms of the price vs probability
of the outcome. After the bet is settled it stops having value as a
financial NFT, but it can still have value! Since the most popular
interesting formats for bettors are either some crazy winnings or
some very upsetting losses. Both types of stories are actively
shared and discussed in betting communities. And our NFTs are 100%
proof of those stories. I often refer to Maradona’s “hand of god”
moment to describe the historical value of an NFT bet. Imagine
someone had lost or won a large amount because of that crazy goal.
I think such an NFT would have had massive value as a collectible.
Besides that, users can be rewarded with NFTs for a variety of
achievements while placing bets on Azuro (e.g. the longest winning
line, awkward losses, highest odds won, and so on – the
possibilities are virtually infinite). Final word Unhackable,
unimpeachable, no third party intervention, so tamper-proof, it
seems clear that the blockchain proposes a complete makeover of how
online betting is conducted, and it seems that the bettors would
agree. On-blockchain betting has gone up 121% in terms of unique
active wallets reaching more than 754,000 unique users in Q3 alone,
representing nearly 50% of the entire sector activity, and with
this kind of monthly growth, it shows no signs of slowing.
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