Introduction.
The Monaco Protocol is a decentralized betting engine restructuring the approach to betting in the global ecosystem. When I was a kid, we usually had this game we always played: the pen game. So, the idea was that at the end of the game, every eliminated player would pay 5 NGN to the champion.
So, if we are seven players, the winning player goes home with 30 NGN. Interestingly, after a joyous pen game tournament, we usually had to settle disputes between the champion and a defaulter. A player might have refused to pay the required 5 NGN, and the winning player who is hell-bent on getting the money would resort to violence.
In situations like this, we usually ended up with serious brawls, and once these brawls began, only our teachers could intervene, and they would punish us for gambling. Bringing this to the real world, when bettors win huge, most bookmakers refuse to pay.
Unlike our junior school game, where the champion could beat up the defaulter for refusing to pay up, it is practically impossible for bettors to do anything when bookies refuse to pay their earnings because these bookmakers have a way of tilting the law to favor them.
Instead, the bookmakers involved go aggressive by closing the accounts of such bettors and even banning them from their platforms. Bettors would painstakingly put in their time and effort to accurately predict events and wager their hard-earned money on their predictions.
When the prediction comes true, the bookies can decide not to pay because the money won is large, and the company doesn’t want to part with such an amount. Here’s a compiled video showing several occasions where popular bookies refused to pay bettors.
The ability for bookies to withhold the earnings of a bettor is possible because of the centralized nature of traditional betting platforms. A bettor visits a betting platform, deposits some funds, and begins to bet on predictions. If the bettor's prediction happens, the bookie initiates the payment of earnings to the bettor; otherwise, the bettor loses the wager to the bookie.
Because bookies control the payout of funds won to bettors, they can decide against paying a bettor if the money won is a staggering sum. The Monaco Protocol is hell-bent on destroying the centralized structure most betting platforms are built on that leaves bettors at the mercy of bookmakers, erecting a decentralized system that is fair to all parties involved.
Understanding the idea behind the Monaco Protocol.
The Monaco Protocol is a fully decentralized, open-sourced, and permissionless betting protocol built on Solana. It provides a decentralized structure on which operators (betting exchanges and bookmakers) can build their platform.
The Monaco Protocol frees up the burden of dealing with complicated traditional betting systems from operators, allowing them to prioritize making betting and predicting fun and engaging for users. The Monaco Protocol is reshaping online betting, making it global and decentralized, creating a seamless user experience.
In Nigeria, there are three popular phone brands: Infinix, Tecno, and Itel. The general idea is that these brands compete with each other for sales, but this is not the case. These brands operate under a parent company: Transsion Holdings. The Monaco Protocol is like Transsion Holdings but for betting exchanges and bookmakers.
Operators can build their platforms on the protocol, enjoying quality usage from a global user base. Instead of spending the whole time marketing for users, these operators have the time to continuously improve their UX to make their product fun, engaging, and retainable for users.
Unlike traditional betting platforms, the Monaco Protocol is decentralized and permissionless, making it more transparent and secure. The Monaco protocol is not just about betting but about speeding up the globalization of prediction markets and welcoming global users.
Peculiarities of the Monaco Protocol.
The Monaco Protocol introduces a paradigm shift in the betting landscape, distinguishing itself significantly from other betting platforms. Here are some explicit reasons why. Firstly, betting platforms built on Web 2.0 and web3 work in silos, with each bookmaker/exchange operating on closed-off liquidity, limiting the scope and dynamism of the markets.
Consider two popular bookmakers, Sportybet and Betking. Sportybet users can only interact with other users and betting options on the Sportybet platform. The liquidity pool of Sportybet, which represents the total amount of money available for betting, is specific to Sportybet. Also, Betking operates independently, and its users and liquidity pool are exclusive to that platform (closed-off liquidity).
Sportybet users can only bet against each other or participate in markets offered by their preferred platform. They cannot interact with Betking's user base or markets (limited market access).
This separation among bookmakers restricts the amount of money available for betting on any given market. Changes in odds, available bets, or market fluctuations on one platform do not directly impact or influence the same conditions on other platforms.
This lack of interconnectedness reduces the dynamism of the overall betting ecosystem. Users are confined to the betting options and odds offered on their preferred platforms, limiting their choices and potentially missing out on better opportunities available on other platforms.
The Monaco Protocol creates a more interconnected and fluid betting environment that eradicates the confinement of users, liquidity, and markets to individual platform boundaries. This interconnectedness can lead to more dynamic and expansive betting markets.
Secondly, Monaco operates fully non-custodial, meaning users have complete control over their funds. Its decentralized nature ensures transparency, security, and trustlessness, unlike Web2 betting platforms where users trust the platform to safeguard their assets.
Monaco settles winnings directly to the wallet of the bettor, streamlining the process, whereas settlement processes on web2 betting platforms might involve intermediary steps, and audit transparency can vary.
With the decentralized nature of Monaco, no operator (bookie or exchange) on the protocol can withhold bettors' payouts, but the case is different for Web2 betting platforms when the payout is staggering.
The Monaco protocol introduces single-outcome binary markets, simplifying betting options to straightforward win/lose scenarios while creating markets from diverse ranges of events, from sports outcomes to weather predictions.
Other betting platforms offer a wider variety of complex betting options on a single market, which may take time to learn and understand, leaving the bettor unprofitable. The Monaco Protocol stands out as an open-source, decentralized, and ready-to-use betting engine.
Open-source here indicates the regular improvements of the protocol to satisfy users' complaints. Web2 platforms often rely on closed, proprietary systems, with updates and improvements subject to the platform's discretion. In essence, the Monaco Protocol's decentralization, emphasis on user control, efficient matching mechanisms, and commitment to transparency set it apart from other betting platforms.
Improving P2P betting experiences with the Monaco Protocol.
The Monaco Protocol can improve the quality of peer-to-peer experiences in the betting industry through top-notch security and trustlessness. The major problem of traditional betting exchanges and sportsbooks is weak security. We have witnessed cases whereby bettors get defrauded through the data these companies collect from them.
The Monaco Protocol goes all in to provide top-notch security to operators and users. Sec3 is a leading security and research firm providing top-notch security software to web3 projects that audits all smart contracts on the Monaco Protocol. With tight security measures, users don't have to worry about wallet hacks while interacting with the protocol.
Another way Monaco is improving the P2P experience in betting is through trustlessness. In traditional betting platforms, an administrative figure has to approve the payment of bettors' earnings. We have had numerous cases where betting exchanges refuse to pay bettors and even void their betslips.
Fortunately, operators on the Monaco Protocol cannot operate this way. After a bettor makes a wager, the operator matches it with other bets and secures the total placed wager in an escrow separate from the exchange.
When the operator marks the market as completed, the operator's smart contract quickly distributes earnings to the wallets of winning bettors. You might say that a developer can program the smart contract to behave otherwise. That is where Sec3, the security company mentioned earlier, comes in.
They audit every smart contract on the protocol to ensure that it works as intended and does not execute any sinister activity on the protocol. Unlike other betting platforms, users do not have to trust the protocol to do the right thing (disbursing funds to bettors if their predictions are correct) because the protocol is built to do the right thing.
Current use-cases of the Monaco Protocol.
BetDEX
BetDEX exchange is a decentralized sports betting exchange built to revolutionize sports betting by leveraging the Monaco Protocol. BetDEX provides a P2P marketplace that allows users to bet directly against each other, eliminating the need for intermediaries like bookmakers.
Consider two friends, James and John. James is a PSG fan, while John is a Sociedad fan. On Valentine's Day, both teams will face each other in the UEFA Champions League. Since the announcement of the fixture, James and John have had multiple arguments regarding the match outcome.
James is bent on his opinion that his dear PSG will win against Sociedad with a large goal gap. John thinks otherwise. He feels that PSG doesn't have what it takes to defeat Sociedad. Rather than having these pointless back-and-forth arguments, BetDEX provides a platform for these friends to bet against each other directly.
If PSG wins, John has lost the wager. The exchange will send the crypto assets he wagered to James's wallet and vice versa. BetDEX provides a risk-free first bet of up to $50 for newcomers. If you lose your first bet on BetDEX, you can get a refund of up to $50.
Secondly, BetDEX charges low fees for transactions conducted on the exchange and 1% on every winning trade. If you win a bet, BetDEX takes only 1% of it as commission. BetDEX allows immediate withdrawals.
Unlike other exchanges that may require you to do a whole lot of verification, preventing your access to your earnings for days, BetDEX does none of that. If you win, you can withdraw instantly. There's no stake limit on BetDEX. Bettors can wager any amount on outcomes without restrictions.
Purebet
Purebet is another use case built on the Monaco Protocol. Purebet is a sports betting exchange and more. Purebet is also a cross-chain sports betting odd/liquidity aggregator. It collects real-time betting odds and liquidity from exchanges and bookmakers across all blockchains and displays it on their site.
Andrew has hopes for Barcelona to win the El Clásico match fixed tomorrow and intends to bet on Barcelona to win. He visits his favorite betting platform, and the odds on the outcomes are way too low. Barcelona to win has 2.55 odds, Real Madrid to win has 1.79, and a draw has an odd of 2.01.
He visits purebet.io to use their aggregator and finds an exchange with 3.10 odds for Barcelona to win. If the prediction goes through, he'll make more money from this exchange offering 3.10 odds than his bookmaker offering 2.55 odds for the same outcome.
Through its cross-chain aggregation, Purebet has helped Andrew and thousands of users compare odds and find the best available prices for a particular event, maximizing potential returns. Purebet provides insights into market liquidity, allowing users to assess the volume of bets on different odds. Interestingly, Purebet offers its users political markets to bet on political outcomes.
Potential use-cases of the Monaco Protocol.
Politics Betting.
It is vital to the growth of a nation for citizens to select individuals who will represent their interests in positions of power, and these selections happen through elections.
During this period, people often engage in heated discussions throughout the day, presenting facts, opinions, and sometimes distorted statistics to support a particular candidate. Election betting is a fun way for citizens to show their support and conviction for their preferred candidate by wagering money on the outcome of political elections.
A use case I would like to see on the Monaco protocol is a global election betting exchange.
The exchange will create markets based on ongoing elections with outcomes such as overall winner, party vote shares, winning candidate in a particular region, etc, and also work directly with the country's political analysts to calculate the odds for the various election outcomes.
Odds represent the probability of a particular event happening. These odds can change due to polling data, campaign events, or public opinion shifts. People can monitor these changes and adjust their bets accordingly.
The exchange will settle all bettors once the election results are announced and the statistics are published. Those who accurately predicted the election outcome received their winnings, while those who didn't lose their money.
Custom Betting.
Another use case I would like to see on the Monaco protocol is a custom betting exchange. Every day, people bet on the most mundane things. With a custom betting exchange, users can create their markets surrounding anything they want, map odds to the possible outcomes of these markets, and still bet on them.
When I hang out with friends, we do fun stuff like drinking competitions, food competitions, etc. Usually, for the drinking competition, two people are selected to drink up to ten 60cl bottles of Coca-Cola, and the first person to finish without spilling the drink is the winner.
The last time we hung out, we selected Divine and Destiny for the drinking competition. Using a custom betting exchange, I can create a market around this competition with possible outcomes like Divine wins, Destiny wins, Divine spills the drink first, Destiny gives up first, etc.
Based on previous experience and available data, my friends and I can decide the odds and map them to these outcomes. We have done this competition about eight times. Divine has won thrice, and Destiny has never won.
Using these data, we can roughly speculate the odds for all outcomes. My friends can then log in to the exchange, search for the market I created, and place their bets. We can then record the video of the event and upload it on the exchange as a source of truth for the outcomes created. Because the event is not a media-covered event like sporting activities, my friends and I will vote publicly on the predictions that came true.
If Destiny won, we all vote that particular outcome true. Once the voting is complete, a smart contract will disburse the total funds wagered on the market to the wallets of my friends who wagered on the correct outcomes.
Conclusion.
The Monaco Protocol can enhance the experience of bettors in the betting industry, saving them from the countless headaches of traditional betting exchanges or sportsbooks. With the development of more projects on the protocol, I'm bullish about the revolution it will spark in the betting ecosystem.
To learn more about the Monaco Protocol and stay updated with the latest happenings about it, visit their website, join their discord server, follow on Twitter, and become a part of the inevitable restructuring the Monaco Protocol is bringing to the betting ecosystem.