Crypto.com surprised the online gaming industry with the announcement of a new sports event trading feature right before New Year’s Day. This new platform is available in all 50 U.S. states.
The launch brings a new contender to the U.S. sports gaming industry. Prospective sports prediction traders can find the new platform within the Crypto.com app.
Crypto.com is a cryptocurrency trading platform, and it offers sports event trading as a service that falls under the jurisdiction of the Commodity Futures Trading Commission (CFTC). The CFTC approves derivative-based sports event contracts, which function differently than traditional sports bets.
“Sports Events Trading offers an entirely new platform for U.S. users to engage nationwide at Crypto.com and in the Crypto.com app,” said Crypto.com co-founder and CEO Kris Marszalek in a press release. “This unique financial product allows users to trade their prediction on the outcome of a sports event. It’s a fundamentally new concept for sports, and we’re thrilled to be the first regulated platform in the U.S. to offer it to our users.”
A New Kind of Sports Prediction Market
The announcement of the Crypto.com sports event trading feature has taken the iGaming industry by surprise.
Traditional online sports betting is legal in more than 30 U.S. states. Sports betting industry giants like DraftKings and FanDuel dominate the market in most of those states.
Federal regulations allow U.S. states to legalize online sports betting on an individual basis. Each state has the authority to approve online sports betting, establish its own set of laws and regulations, and determine which brands can operate within its borders.
The sports event trading platform launched by Crypto.com is similar to an online sportsbook, but with a few key differences that put it in a different category than traditional sports wagering from a legal perspective.
Mobile sports betting apps like DraftKings Sportsbook offer bets on sports games and other statistical outcomes within the game. The sportsbook sets the odds on a particular outcome, and players wager with those odds in mind.
The new Crypto.com platform doesn’t offer traditional sports bets, instead presenting derivative trading for sports events. Players don’t wager against the sportsbook; they take one side of an event prediction and enter into a contract with a player taking the other side.
The potential payout of a trade is determined by the percentage of contracts taken on each side by other traders.
For example, the most recent Super Bowl trading markets looked like this:
The Kansas City Chiefs are the favorite to win the Super Bowl according to trading activity on Cryto.com. A total of 25% of all contracts on the Chiefs predict Kansas City will win the Big Game.
Players can enter into a $100 contract on Kansas City’s Super Bowl win chances. You can buy “Yes” for $25, or “No” for $77. When you buy one side of the contract, the trade completes when another player buys the other side of the prediction.
The winner of the trade collects $100 total.
Cryptocurrency and the Future of Gaming
As reported by Sweepsy.com, “Sports trading and online gaming continue to evolve, and Crypto.com’s new sports trading product marks yet another step in the integration of cryptocurrency and gaming.
Players can turn to cryptocurrency as a deposit and withdrawal option at many online gaming sites. Several of the most popular sweepstakes casinos offer cryptocurrency payment and redemption methods as well.”
The speed and anonymity of cryptocurrency transactions make them inherently effective for gaming. The development of innovative cryptocurrency gaming platforms like the new Crypto.com product likely won’t slow down any time soon.
