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Are Bitcoin Gambling ICOs a Good Investment?

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Bitcoin Gambling ICOs

Gambling is one of the most lucrative industries in the world and it is, therefore, not surprising that gambling using the cryptocurrency bitcoin is also becoming increasingly popular. In the last few years, a wide range of online bitcoin casinos have opened their doors to enable users to gamble using bitcoin. Bitcoin casinos allow their users to deposit and withdraw money at a low cost whilst remaining anonymous, which is especially useful for gamblers who are located in countries where online gambling is frowned upon or heavily regulated.

“Today, over $1 million US dollars worth of bitcoin are being wagered every day across online bitcoin casinos.” – The Bitcoin Strip

As the popularity of bitcoin as a payment method for online gambling increases, so does the profitability of bitcoin casinos. That begs the question “are bitcoin casinos a good investment?”

Now, you may ask yourself “how can I invest in bitcoin casinos?” The answer is simple: bitcoin gambling Initial Coin Offerings (ICOs).

Initial Coin Offerings (ICOs)

An Initial Coin Offering (ICO) is an innovative way to raise funds for a new cryptocurrency project by distributing a percentage of the initial coin supply among early-stage investors. Most ICOs work in a similar manner as an Initial Public Offering (IPO) on the stock market. With an IPO, you as the investor, receive a percentage share of the company that you invest your money in once it floats on the stock exchange. In an ICO, you receive a share of the initial coin supply, which then gets publicly traded on cryptocurrency exchanges once it officially launches. And much like when investing in the shares of a company, the value of the new coin linked to the cryptocurrency project will increase as the project performs well and, therefore, gains in value.

ICO’s have become a popular investment class for return-hungry investors as ICOs can often double or triple in price within the first few days of trading. On the other hand, some new coins that are released through ICOs can turn out to become near worthless within a matter of days, weeks or months after their launch. And in a few unfortunate cases, some ICOs have turned out to be outright scams – hence, investing in ICOs is a considerably high risk/high return game that needs to be handled with caution.

“Aside from some of the major players, a large proportion of online bitcoin gambling sites operate under little or no regulation. Investing in a such a scheme requires a great deal of due diligence, but as we have seen with Bitcoin in general, the opportunity to generate a huge ROI is certainly out there.” – Andreas Russell, BigcoinGambling.com

Bitcoin Gambling ICOs

This brings us to a new subsector within the ICO space: bitcoin gambling ICOs. In the last few months, several bitcoin gambling ICOs have been announced, including vDice, BetBase, BetKing and Etheroll. Let’s look at each in more detail.

vDice

vDice is the world’s first fully decentralised gambling game built on the Ethereum blockchain. On November 15th, its ICO was launched and it runs until December 15th. vDice has been live since June 2016 and has cemented itself as a popular cryptocurrency gambling game.

The vDice token, which will be sold during the ICO, is called ‘vSlice’ and will distribute profits of the vDice game to token holders, according to vDice’s press release. You can trade these tokens on an exchange immediately or keep them to receive a share of the company’s profits. vDice is looking to issue 96,000,000 tokens during its ICO and has been developed by a range of industry experts.

BetBase

Another gambling ICO that has recently been launched is that of BetBase. According to its website, BetBase is a platform offering anyone a chance to start his or her own online bitcoin casino for no costs and without any coding required. BetBase provides an API, a shared bankroll, a provably fair mechanism, and more. Every bet placed against their servers is processed using their own bankroll so you the casino owner gets paid for each bet made, no matter if the customer wins or loses the bet. For every bet placed you get paid 50% the house edge of the bet. 

Its ICO started on November 27th, 2016 and will continue until December 18th, 2016. BetBase is looking to issue 100,000,000 shares, which will be split 60% to ICO investors, 10% for bounties and 30% to the owners. The money raised will be used to bolster BetBase’s bankroll and to further develop its platform. Despite a promising sounding ICO, when scrolling through their sales page and their bitcointalk.org ICO thread, there are (as is not uncommon with ICOs) some concerns about its legitimacy as there is no real information about the company owner, only a pseudonym used in a bitcoin forum. In my eyes, this omission is a red flag that needs to be closely monitored before making an investment. Especially given the already risky nature of ICOs.

Bet King

Another bitcoin gambling ICO that has recently been launched is the ICO of BetKing. BetKing is a bitcoin dice platform. Since the launch in April 2013, BetKing has grown into one of the most popular bitcoin dice games with over 397,000 bitcoin wagered and earnings of over 7200 bitcoin profit according to the BetKing website.

The BetKing ICO crowdsale began on December 1st 2016 and closes on January 1st, 2017.  The BetKing team plans to raise investment so they can develop more products including casino games such as blackjack, slots, and roulette. Also, the funds are set to go towards developing a sports betting platform and poker room as well as a host of other gambling related products and services. BetKing plans to create 100,000,000 tokens to represent 100% shares of BetKing, of which 30% will be distributed to investors at the end of the ICO while the remaining 70% will remain in the ownership of Betking. After the ICO is over, dividends will be paid as a share of the total profit generated by BetKing in bitcoin every 3 months. To buy shares during the ICO period you need to sign up or log in to BetKing and deposit the bitcoin you wish to invest, or use the existing balance you have on your BetKing account.

Etheroll

Etheroll is an Ethereum smart contract platform for playing a dice game using Ether with no deposits. Etheroll is a good example of an ICO that was announced but never actually completed. In June 2016, Etheroll announced their ICO that would let investors receive a share of Etheroll’s profits. However, on June 18th the founder of Etheroll announced that the ICO will not be completed due to the DAO hack that has flagged up security flaws in the Ethereum network so all of the invested Ether was returned to the investors according to the company’s blog.

Investing in ICOs is always a high risk/high return game

Remember, when you are investing in ICOs, gambling-related or otherwise, you are putting money in an entirely unregulated sector that carries a high level of risk. That is why it is important to only ever invest an amount you can afford to lose and to always conduct thorough research before investing in any ICO to reduce the chances of you losing your money.

Having said that, if you are a gambling expert and can tell the difference between a good gambling provider and a bad one, then picking the right bitcoin gambling ICOs could generate a very nice return on your investment.

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Kidnappers in South Africa Demand Bitcoin Ransom for Teenager, Boy Found Unharmed

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Kidnappers Demand Bitcoin Ransom

In South Africa, a gang has kidnapped a 13-year old teenager and demanded a ransom to be paid in bitcoin for his release. The abductors have demanded a ransom of 15 BTC, which is an equivalent of $120,000 at today’s prices.

“This is a kidnapping! We have your child. Your child will not be harmed if the following demands are met: We demand a ransom of 15 bitcoins to be paid to the below Bitcoin wallet to secure your child’s safe release,” reads the note left by the kidnappers.

According to The South African, 13-year-old Katlego Mariate was kidnapped while playing with two of his friends at his home in Frangipani Street, Tasbetpark Extension 3, Witbank. Witnesses testified the victim was grabbed into a gold Toyota Corolla occupied by three unknown men before driving off.

The Police spokesman, Brigadier Leonard Hlathi, said the situation is being investigated:

“We are investigating a case of kidnapping that happened on Sunday in Witbank. There was a demand that was made that the parents should deposit cash in bitcoins.”

Another police officer said the parents of the victim, who are in deep shock over the incident, do not even know what bitcoin is. “They don’t even know what this bitcoin is. They’re devastated and you can see they’re worried and asking themselves: ‘Where’s our son?”

Boy Found Unharmed

According to Reuters Africa, police spokesman Hlathi informed the public that the boy was found unharmed on May 24.

This appears to be the first case in the country involving a bitcoin ransom in a kidnapping. However, it is not the first time this has happened in other parts of the world. Last year, a bitcoin analyst was kidnapped in Ukraine and, in early 2018, a lawyer was abducted with respective kidnappers demanding bitcoin as ransom in Mexico.

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Golix Shelves ICO and Takes Reserve Bank of Zimbabwe to Court Over Cryptocurrency Ban

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Zimbabwe Cryptocurrency Ban

Following the directive by the Reserve Bank of Zimbabwe (RBZ) to ban cryptocurrency, one of the largest cryptocurrency exchange in Zimbabwe, Golix, has now gone to court challenging the directive by Zimbabwe’s central bank after it was forced to shelve its token sale, which was scheduled to start on May 14. and was asked to cease operations by the central bank.

Golix informed Bitcoin Africa on May 15 that it has decided to suspend its planned ICO due to the RBZ’s new directive, which is effectively forcing them to shut down its operation by preventing banks from dealing with cryptocurrency startups. Moreover, as reported by TechZim, the central bank also reached out to Golix directly, in the week to follow the directive announcement, informing them that they are required to cease operations entirely.

Aside from warning the general public to keep away from decentralised digital currencies, RBZ sent a directive to all banks on May 11, 2018, giving them a maximum of 60 days to end any relationships they may have with cryptocurrency exchanges. Several bank accounts belonging to Golix have already been closed.

The circular, which was issued by the Registrar of Banking Institutions in Zimbabwe, N. Mataruka, lists Golix and Styx24 as the country’s cryptocurrency exchanges. In the circular, one of the reasons RBZ gave regarding the ban was that they wanted to be able to “safeguard the integrity, safety and soundness of the country’s financial system, and to protect the public in general”.

Golix is Fighting Back

Golix Launches ICOGolix will not go out without a fight. Golix has presented the High Court of Zimbabwe with three arguments on why the ban of cryptocurrency in the country is not just. In their first argument, Golix questioned whether the RBZ has any legal authority to ban cryptocurrencies. In their explanation, Golix detailed how they had severally met the RBZ including a day before the circular was released. According to their first argument, RBZ has no authority over Golix and neither have they, in their engagements, ever shown or behaved in a manner that indicated so.

Golix’s second argument terms RBZ’s directive as unfair based on the legal principle of administrative justice as the central bank of Zimbabwe neither gave reasonable notice nor the right of response. This, according to Golix’s argument, means the RBZ breached the right to Administrative Justice considering that by statue, RBZ is an administrative body.

A quote from the second argument by Golix as shared by Techzim states:

“Applicant was never advised prior to the ban that it will be implemented even though Respondents had ample opportunity to advise Applicant of same. As aforesaid, the last meeting between the parties was held on 11 May 2018. Four officials from the Applicant including myself attended the meeting while fifteen officers, including the Registrar of Banking Institutions represented the Respondents. In that meeting, the discussions were more of Respondents wanting to learn and understand the technology behind our business and our business model. The impression we got was that Respondents wanted to understand in order to begin working on regulation. No mention was made of any impending ban on our business”.

Unconstitutional Ban

According to Golix’s third argument, the ban by the RBZ is unconstitutional. Golix sited Section 68 of the constitution by saying: “Section 68 of the Constitution requires that administrative action be lawful, reasonable, proportionate and procedurally fair. I humbly submit that Respondents’ actions fell short of the standard required in the Constitution”.

In their defense, they give reasons as to why the view the directive as unconstitutional as:

“First, the press statement issued by 1st Respondent does not state the purpose for which the ban was imposed. The reason why it was necessary to impose the ban is not stated in the press statement. We can only speculate as to why the ban was imposed. In the absence of a clear reason for the imposition of the ban, it is really difficult to assess the proportionality of 1st Respondent’s decision vis-a –vis the goal it was intended to achieve. Nonetheless, even in the absence of a clear reason for the ban, it is not difficult to see that the decision is disproportionate”.

Following the directive, Golix issued a statement via their blog notifying its customers that unless RBZ changed its position before the 60-day window period given, they “will not be able to send or receive fiat currencies for cryptocurrency trades”.

While the High Court of Zimbabwe will determine the fate of the case between Golix and RBZ, the move by Zimbabwe’s central bank to ban cryptocurrencies is a clear indication of how most African states are yet to embrace digital currencies such as bitcoin. And while we cannot speculate on the ruling that the court will make, this move could slow down the adoption of cryptocurrencies in other African markets.

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Can Bitcoin QR Codes Provide Artists With A New Revenue Stream?

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Bitcoin allows everyone in the world with an Internet connection to send and receive payments without the need for a financial institution as an intermediary. This also enables anyone to be rewarded for their product, service or even artwork by simply providing a bitcoin address for payments.

Pascal Boyart, a French street artist, is using quick response (QR) codes to help Kickstart his street art career with bitcoin donations. He recently gained the attention of the bitcoin community when one of his murals became a trending topic on the Bitcoin subreddit. Boyart has already received over 0.11 bitcoin, which translates to roughly $1,000.

A self-described cryptocurrency enthusiast, Boyart believes that there are many benefits for the creative industry from decentralisation. According to a report by The Next Web, rather than displaying art in galleries and going through dealers, the bitcoin QR code is part of a movement by artists who want to gain more independence. Boyart also explores the themes that relate to crypto and decentralisation in his work. The artwork that made Boyart popular on Reddit was a mural painting of Rembrandt, the famous Dutch painter.

Bitcoin QR Codes

Bitcoin QR CodesWhen using bitcoin to pay at point-of-sale or face-to-face, users generally scan QR codes to make the payment instead of typing in lengthy bitcoin wallet addresses. A QR code can easily represent the amount of data required in a machine-readable manner for a bitcoin payment to be processed.

Independent artists often struggle financially, which is why new forms of monetisation, such as Patreon or integrating cryptocurrency QR codes into their work, provide excellent alternatives that could lead to artists being able to live solely off their art.

Boyart managed to earn revenue from his murals without needing an exhibition in a gallery simply by attaching bitcoin QR codes to his work. This shows that as a decentralised peer-to-peer payment platform, bitcoin presents all creatives, whether they are authors, artists, musicians or photographers, with a new potential monetisation avenue as they can sell their work directly to fans worldwide.

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