The Hive Backed Dollar (HBD) has some incredible potential. This is a base layer coin that is inherent to the Hive ecosystem. For this reason, we have the ability to build around it.
One of the keys with value of any currency is the economic activity tied to it. This means that HBD requires an increase in utility.
There are a few initiatives where commerce is beginning. One area is Sucre, Venezuela. There are more than 50 retail locations accepting HBD as payment for goods and services.
It is a good start.
However, to be an impact, we need to expand the utility greatly.
In this article we will look at one use case that could be enormous.
Games of Chance
It seems that most people love games of chance. This can be summed up by the term gambling.
Here we are dealing with an industry that is enormous. When talking about numbers, this one has it.
The exact revenues are hard to find. A lot of this industry is not where people can see. We will touch upon that shortly.
We are looking at an industry that is around $250 billion globally.
This is what is done through casinos and gaming applications. How much is done among people directly? It is where the impossible enters. If we look at "friendly wagers" there are billions included.
Over the last year, since the U.S. Supreme Court struck down a ban on gambling, we see companies like DraftKings mentioned on baseball and basketball broadcasts. The leagues are actively promoting it since these firms are advertising with them.
It is an obviously move since betting and sports have always gone hand-in-hand, albeit not always legally.
This is something that Hive should tap into.
HBD For Gambling
We had a simple idea appear on threads the other day. This is a small pool amounting to 100 HBD. The group is small but does emphasize the potential if scaled.
Under this scenario, a $100 bet is being made on the NFL. A group put up 10 HBD apiece, sending it through an individual. The wager is being made through one of the Las Vegas casinos. If the pool wins, the money will be used to payout, in HBD.
Here we have a very simple example of the potential. Eventually, the best idea is to build gambling applications around HBD. Consider the possibilities.
Over the years, we saw different games of this nature. What we did not see was a "casino" that handles this. Nor did we have sports betting. This is where the numbers can get huge.
Another area that is worthy of mention is Fantasy Football. Again, among NFL fans, this is big business. It also came to my attention that English Premier League followers love it also.
Every fall, millions engage in this, entering leagues and building their teams. In most instances this is just good ole fashioned fun. There are, however, some that deal in big money.
It is not surprising to note that Las Vegas is big into this.
Here we have something that we can build around HBD.
Benefits to HBD
The reason why this is a powerful utility for the currency is multi-faceted.
To start, most understand it. We are dealing with something that many are familiar with. Place some HBD on whatever is being wagered.
It doesn't get much simpler than that.
Another benefit is the need for liquid HBD. Having a tremendous return through HBD savings is terrific. However, one of the keys to currency is the velocity of money. This does not happen when it is staked. Instead, to grow an economy, it needs to travel. It can only happen in liquid form.
What this means is that people have a reason to hold liquid HBD in their wallets. The tendency is to think that people will amass HBD and then seek to convert it to HIVE. Without use cases, this could happen.
Here is one example of where the incentive, due to the desire to gamble, is to do the opposite. HBS is required for the gaming.
The final advantage is in the economic activity that is tied to it. We just showed a very small example of 100 HBD. This is a few people getting together for a simple wager. Multiply this by 100. Or 1,000.
Ultimately, there could be millions of HBD moving around as people engage in all kinds of gaming activities.
What It Will Take
At present, this cannot be easily set up on Hive. The near term action is going to have to be similar to what was described here. There needs to be a trusted individual that holds the money. This does introduce counterparty risk. Fortunately, with individual usernames on Hive, there are some who have reputations within the community.
To construct this properly, smart contract technology is required. This is being developed so we should have something by the end of the year. VSC is working on something that might be ideal for this.
Here we see the ability to incorporate multi-sig wallets. That will provide the security people need to prevent rug pulls. Here is where the technology can help to instill confidence in the gaming community.
With HBD, or some derivative of it, as the centerpiece, the need for that coin increases. This reverts back to the basic design and the problem we have: there is not a lot of HBD available.
The answer to this is the conversion mechanism. If we get large players involved, someone is going to converted HIVE-to-HBD, creating demand for the other base layer coin.
As always, it all comes back to utility. The design of Hive is very powerful. If we had gambling as one of the utilities for HBD, we could see a massive demand for both coins.
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