Is GambleFi that huge or is it just a fugazi people use to pump their bags?
@thalesmarket's positioning as an infra opens up the horizon for the longer-term whilst getting some share of the existing market!
A quick primer on Thales and my candid thoughts on GambleFi. (1/17)
This thread will be split into 2 parts:
1️⃣ What is @thalesmarket? [3-9]
2️⃣ Personal thoughts [10-14]
1️⃣ What is @thalesmarket?
Thales is building DeFi's infra for parimutuel markets.
Parimutuel betting (i.e., pool betting) is when bets are pooled together and the funds (less house fees) are shared across all winners.
Unlike fixed-odds betting (e.g., roulette), the odds in a parimutuel market changes as more bets are placed -- allowing the 'market' to price in the odds.
Horse racing bets typically run on this model.
A great explainer on parimutuel mkt and Thales' mechanics by @Defi0xJeff.
twitter.com/Defi0xJeff/status/1698682433795920240
Being an infra, given oracle support and clearly-defined (and supported) conditions, betting markets for about any conditions can be set up!
Products built on top of Thales:
1️⃣ Positional markets
> Will an asset go above or below X in a week?
2️⃣ Ranged markets
> Will an asset be within or outside a price range in a week?
3️⃣ @OvertimeMarkets (sportsbetting market)
> Will X win against Y?
>> By how much?
- Sportsbook positional market
- Multiple layers of bets in a match
- Allows parlay (chained betting)
4️⃣ Speeds market (their latest product line)
> Will an asset be above or below the current price tomorrow?
- Shorter duration positional markets (and X replaced with current price); or as per @Defi0xJeff , "Positional markets on steroids"
- Essentially, binary options
Binary options is banned across multiple jurisdictions due to the shady operations of many brokers (e.g., inciting gambling, blackboxed price feeds, unlicensed, etc.).
DeFi's the solution.
- Removing trust dependencies (besides oracle, which is provable)
- Democratises access
For crypto markets, the odds are priced in using Black Scholes, price skew and other price/IV-related formulas, on top of the market's demand for the position.
LPs are restricted to $THALES stakers.
2️⃣ Personal thoughts
GambleFi has no doubt found PMF within the crypto-native/DeFi crowd. Gambling is a degen's daily bread.
However, it is a stretch to say that it will onboard non-natives. It takes more than just the dApps; it requires a friendly onboarding process.
Most of the friction is still in the wallet and on- and off-ramp sides. Although there have been many efforts and upcoming features (enabled by AA, MPC, etc.), we have yet to find a solution that will not scare off outsiders.
GameFi was able to take off despite all of this because, prior to the P2E model, there was no such lucrative (and 'easy', be it sustainable/not) way for gamers to make money.
As a result, people were willing to overcome the hurdles.
This is not the case in the traditional gambling scene, where the perceived benefits of GambleFi are more nuanced.
Not to mention the already established channels in the traditional gambling space.
All things considered, @thalesmarket's positioning as an infrastructure is a smart play.
Its products are currently meeting the needs of existing natives, and they can easily scale to meet the needs of newcomers once onboarding friction has been removed.