Prediction contest business model

[btcjeez]

Hi Friends ,

I am planning to launch an daily prediction contest website on bitcoin closing price . concept is simple --
User pays 10cent per prediction (max allowed prediction per user is 5 attempts) , winners will get max 100$ worth of bitcoin or crowd fund recieved .

Will this business model work good ??
Any pros and cons ?

[1714634048]

1714634048

[1714634048]

1714634048

[Gotottack]

It's a good model, but where would you be basing your closing prices? It will really depend on that too. Also, since cryptocurrency trading is 24/7 kind of thing where do you plan to base your closing price again?

Another thing to consider, is will you be giving out a set odds? Will you be doing it like it sports betting where there is some kind of money line and it moves depending on the time the gambler placed his bets?

How will you do it too, will it be like:

Option 1
A) 1,000 = x5.00 B) 1,200 = x4.00 C) 1,300 = x2.000 D) etc.

Option 2
Players will enter their own prediction then the system will generate the odds based on the prediction placed, current price at the time it was placed, and other such factors.

[btcjeez]

gotottack ,
thanks for replying

1)regarding closing price-
i do undesrtand its 24/7 market. hence i chose it will be today's midnight GMT timestamp closing price  .

2)it wont be set odds gambling . i would rather chose to make it prefer it to be simple to user . prediction starts from 1:00 AM and ends at 10:00 PM . will annouce the result next day morning 5:00 AM  .

First 100 correct predictors will get 100 $ or the money recieved from crowd fund .

does it makes sense . i am still new to this and trying to discuss with you guys and then plan to launch . so plz educate me , if i am missing or my understanding is wrong

thanks

[Juggy777]

It's a risky model for me. Like the above user stated, what exchange price will you keep. Secondly what will happen if 10-50 get it right, will you give it to all, that would mean low rewards and they won't come back again. Plus time zone will be another issue for you to track your price. And you will be spending some crazy amount to keep your site up and safe from attacks, and it's rude to say but if cant keep up with payment or even what you initially want, it will be termed a scam immediately. My advice would be to refrain, but maybe others will have different views.

[btcjeez]

juggy thanks for your reply ,

i dont feel its risky model ,since i payout only crowdfunded , i do understand i may lose out few customers if the payout are less , however will see an other workaround what can it be done at later stage to retain the customer .

yes timezone is issue , however i chose the index value from single reputed market (say google /coindesk) which most parts of world checks for bitcoin value .
 
if there are multiple winners as mentioned above , max payout is 100$ or crowd received fund (first come first basis).

regarding spending on website/servers avoiding scammers ,bots is definetly an challenge i need to plan later technically to make it safer .

thanks

[Gotottack]

juggy thanks for your reply ,

i dont feel its risky model ,since i payout only crowdfunded , i do understand i may lose out few customers if the payout are less , however will see an other workaround what can it be done at later stage to retain the customer .

yes timezone is issue , however i chose the index value from single reputed market (say google /coindesk) which most parts of world checks for bitcoin value .
 
if there are multiple winners as mentioned above , max payout is 100$ or crowd received fund (first come first basis).

regarding spending on website/servers avoiding scammers ,bots is definetly an challenge i need to plan later technically to make it safer .

thanks

This is why you must have some kind of money line to your bets. You have to have odds and chances and multipliers, I am no expert on these but I really believe this will be your friend. As this could prevent your site from going down because everybody just made a winning bet and the winnings are not worth it.

[Red-Apple]

what is the difference between this and a binary option? which i believe you can bet in short term and not only once per day.

yes timezone is issue , however i chose the index value from single reputed market (say google /coindesk) which most parts of world checks for bitcoin value .

it is not really an issue in my opinion. you just need a set of clear rules about time and where you get the price.
for time it can be UTC time so it can easily be calculated and converted to each person's local time. and you can set a end time for making the bets. like 2 hours until the end.

for where, don't use google or coindesk. they will give you average price and it is messy specially at times like this where one exchange (ie bitfinex) is $100 above others!
just choose a proper place and make an API call and get the closing price. i think bitstamp or coinbase or kraken can be good for this.

[Gotottack]

what is the difference between this and a binary option? which i believe you can bet in short term and not only once per day.

yes timezone is issue , however i chose the index value from single reputed market (say google /coindesk) which most parts of world checks for bitcoin value .

it is not really an issue in my opinion. you just need a set of clear rules about time and where you get the price.
for time it can be UTC time so it can easily be calculated and converted to each person's local time. and you can set a end time for making the bets. like 2 hours until the end.

for where, don't use google or coindesk. they will give you average price and it is messy specially at times like this where one exchange (ie bitfinex) is $100 above others!
just choose a proper place and make an API call and get the closing price. i think bitstamp or coinbase or kraken can be good for this.

You have a point about binary trading. Though I think the difference is, it is based of closing prices and not really the moving prices of bitcoins. It's more of something like sports betting where we wait for the results and which is quite longer than just doing binary trading. There might be some market for this kind of gambling.

[jhenfelipe]

~snipped~

if there are multiple winners as mentioned above , max payout is 100$ or crowd received fund (first come first basis).

I think first come first serve rule when selecting the winner (multiple) is a bad idea. Well, it's just for me because I do think that all winners deserve to get their prize.

Anyway, we can't guarantee if this will work or not. If you try, you'll know. Good luck.

[piloder]

There are already many binary option sites where you can bet on bitcoin price which is quite easier and you can even get 2x or more within few seconds, if your prediction turn out right.

Also i think you need atleast one trusted person to act as escrow in middle because this concepts looks more like lottery.

[audaciousbeing]

The prediction should actually be itemised whether its going to be on a sporting event or its going to be trade or even binary. When that is settled then the next is what would be the deciding factor to determines the winner, are you going to be the one or a trusted site. Aside that, what would happen if every body predicted correctly? The most important is the trust in the sense that how many people will trust you enough to pull funds together for an event such as this. Its really a nice concept as well as with challenges attached to it.

[BlockEye]

juggy thanks for your reply ,

i dont feel its risky model ,since i payout only crowdfunded , i do understand i may lose out few customers if the payout are less , however will see an other workaround what can it be done at later stage to retain the customer .

yes timezone is issue , however i chose the index value from single reputed market (say google /coindesk) which most parts of world checks for bitcoin value .
 
if there are multiple winners as mentioned above , max payout is 100$ or crowd received fund (first come first basis).

regarding spending on website/servers avoiding scammers ,bots is definetly an challenge i need to plan later technically to make it safer .

thanks

This is why you must have some kind of money line to your bets. You have to have odds and chances and multipliers, I am no expert on these but I really believe this will be your friend. As this could prevent your site from going down because everybody just made a winning bet and the winnings are not worth it.

Nah. That is not needed. IMHO based on OP explanation about distribution of price. He will just used the crowdfund for the price and the max price will just 100$ if ever the crowdfund exceeds to that amount. The exceed will be the profit of OP. And it is very hard to predict 100% accuracy so it means that if there are no winner then OP take all the crowd fund. So there is no risk out there..


@OP,  the tolerance of prediction is vey important factor to consider because it is really hard to predict a 100% accuracy.

Conclusion:
Actually there will be no issue about the closing time, As long as OP provide a countdown timer and determined what site he will use for the price. Then it will run smoothly.

And regarding if multiple winner. I think OP will just divide the prize on equal part for each them. That was the logic based on reading OP mechanic.

@OP, please correct me if I stated a misunderstanding about your mechanics. This business is interesting. Goodluck!