Fareplay: The On-Chain Casino With No House

January 16, 2024

In conclusion

A wise man once said, “In gambling, there are only two kinds of people, winners & quitters”, and your average crypto degen is the perfect embodiment of this quote. 

At first, gambling stayed limited to 100x leverage perp trades and aping random shitcoins on-chain with absolutely zero due diligence. But over the past year or so, the needle has shifted. To go along with our on-chain casino, we started seeing the rise of actual online crypto casinos. 

Interestingly enough, these crypto casinos have done more for crypto adoption than any other protocol out there. With the help of celebrities and streamers promoting platforms like Stake, these casinos have ushered in a new wave of crypto-familiar users to add on top of the crypto natives.

The big dogs in this realm are Stake. They print an ungodly amount of money every day, and activity on the platform only continues to increase. A new competitor recently emerged in Rollbit, another centralized crypto casino, with the main difference being that they have a token. So a portion of Rollbit profits are used to buyback and burn RLB. 

However, the issue with these casinos is the same issue we have with all other centralized products in crypto: centralization, censorship, lack of transparency, and trust.

When you hold your assets on these casino platforms, you’re trusting the platform with your coins. If you don’t withdraw in time, there is always a chance of them rugging you (a la FTX) and you never see a single cent from it. Another issue is censorship. You are at the mercy of the platform. They can ban your account at any time, suspend withdrawals, or enforce any other kind of censorship they choose. Lastly, you have no verifiable info on what’s happening behind the scenes at these companies. You just have to trust that there’s no malpractice. 

It doesn’t take a genius to figure out what solution I’m going to propose.

As much of a meme as this saying is, there is some truth to it. The need for the decentralization of this space is imminent.

Many people have already acted upon this and built on-chain casinos, but they’re fairly clunky, not innovative or different in any way, and in general, they’ve struggled to gain meaningful traction.

Today, we’re going to introduce you to an on-chain casino that may completely change the game. 

So sit back, kick your feet up, and enjoy as we take you through the Fareplay Casino. 

Fareplay: Overview 

When it comes to building an on-chain casino there are a lot of things to consider. 

The positives include making use of Chainlink’s verifiable randomness function (VRF). You can use immutable & transparent smart contracts, and players can play directly from their hot wallets. Hence, they’re always in custody of their assets. 

The problems mainly stem from liquidity. 

One way is to get a bankroll and act as the house to initially pay player winnings and then make a profit over the long run. But this is not something that the Fareplay team were interested in. The other way is to make it a peer-to-peer system, but that again presents liquidity issues due to size disparity between players. So engineering that system would be difficult. 

What Fareplay has landed on is something rather brilliant. 

Bringing a FARE system into place

At the heart of the casino is the FARE token. To play any of the casino games, a user has to buy these FARE tokens. Let’s say the user wagers their FARE tokens and wins. This will trigger the protocol to mint the amount of FARE tokens that the user won and send it to them. However, if they lose, the FARE tokens wagered will be burned forever from the supply. 

As we know, over 95% of casino goers tend to lose money over a longer period of time. I mean, it’s literally rigged against them. This means that over time, the FARE token will be deflationary since the expectation is that more players will lose rather than win. 

The core idea here is not for Fareplay to make just another average casino, become the house, and print money. 

The idea is to create value for the wider distributed network where every FARE token holder is essentially ‘the house.’ 

How does it work in the real world?

Let me explain with an example. 

Allow me to introduce Bob. Bob is just like you and me, a degenerate gambler. He takes out his last $10k to his name and goes to the casino. He exchanges his $10K for chips and starts betting. Once he loses all his chips, this $10K is now realized profit for the casino. 

Conversely, Bob could degen his money away from the comfort of his home. Let’s say he puts his $10K into buying FARE tokens. This initial buy will have some price impact, for starters, already benefiting holders. But let’s say he loses his $10K worth of FARE tokens. Those tokens are now burnt out of the supply forever, which further benefits the entire distributed system of FARE holders.

This is effectively an on-chain casino with no house because the house edge is woven into the tokenomics. 

Insane, right? 

Rather than playing against a treasury, the users are playing against the FARE/USDC liquidity pool. This liquidity effectively becomes the casino's bankroll to pay players. 

Fareplay understands that gambling is a predatory game. So rather than only one centralized party benefitting and buying reasonably sized mansions in Australia, it’s more beneficial to create a casino where a network of users can benefit from the casino's upside. 

Now, let's get a little more technical. 

The technical nitty-gritty

Each game is its own smart contract. So when you interact with a game, you’re really interacting with one of the smart contracts, which has the Chainlink VRF integrated. This means the ‘house edge’ per se is stipulated in the contract, and it’s transparent for anyone to read and verify for themselves. 

The way this contract works is when a user deposits their FARE into the contract, it automatically burns it. If a user loses, that money stays burned. However, if a user wins, the contract triggers a separate mint function, which mints the respective amount of FARE tokens and deposits it into the user's wallet. 

The type of contract used by Fareplay is known as a probability contract. The premise of these contracts is to be able to perform on-chain ‘experiments.’ An experiment in this scenario is essentially a procedure that can be indefinitely repeated and have a well-defined set of fixed outcomes. 

A coin flip is an example of an experiment. When you flip a coin, there is a 50% chance it lands on heads and a 50% chance it lands on tails. So, a user can prompt the contract to flip the coin, and the contract will generate the on-chain outcome of either heads or tails. 

This makes it the perfect contract for on-chain casino games. 

Speaking of which, Fareplay will have three games when they launch. 

The games on launch

They will begin with Dice, Coin flip, and rock paper scissors. After this, they will implement Spin, which is a simplified version of roulette, and Plinko. Once these are implemented, they will go on to add all the other popular online casino games that we know and love. 

Tokenomics

The total supply at launch will be 50 Billion FARE tokens. 

It will have an elastic supply with the expectation that it will become deflationary, given that coins are more likely to be burned than minted. 

Details around the token distribution and vesting schedules have not been fully finalized as yet. Since they’re subject to change, we would recommend following their socials to stay up to date on all the latest info. 

Concluding thoughts 

If we zoom out and look at the broader trend for the crypto industry as a whole, it looks like this. 

Legacy > crypto enabled > crypto native 

An example of this playing out can be seen with exchanges. 

Fidelity > Binance > Uniswap

We are likely to see the same play out with casinos. 

Las Vegas > Stake/Rollbit > Fareplay 

We haven’t seen any meaningful innovation from on-chain casinos, which is why we haven’t seen this move yet. Fareplay has entered the market with an incredibly unique vision and is likely to be the protocol to spearhead the movement from crypto-enabled to crypto-native. 

But this is not all. 

What I described above is merely the first step of the grander vision. Eventually, Fareplay is going to be a 3D world where you can access the Fareplay casino.

Additionally, Fareplay is actually built on top of FARE Protocol, an ecosystem of smart contracts through which anybody can build their own game or user-facing app. You can think of FARE Protocol as a separate casino infrastructure layer.

The vision is grand and the team has the wits to back it up. I would keep my finger close to the pulse on this one, anon.

You dont have a LARP NFT or are subscribed to Unlock Protocol. For Pro Access, Subscribe to Unlock Protocol here.
If you have another wallet with LARP NFT, change it here.

Table of contents
Prices
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Top Tweets