Play, a Chinese startup that plans to disrupt the incumbent online game industry using bitcoin's blockchain to remove trust, has recently 'gone public' as a decentralized autonomous company (DAC) on crowdfunding platform DACX.com.
In its prospectus, Play claims it offers a third-party verifiable mechanism to ensure true randomness and fairness for gamers by placing the games' logic on the blockchain. This would remove the need for trust in centralized institutions, it says.
The startup will also offer a platform to aggregate all games using its proprietary technology, and an in-game assets-trading platform to make tokens, props acquired from different games and Play’s crypto-shares exchangeable.
The DACX platform is operated by Zafed, a Shanghai-based financial service provider established in September last year, which itself has raised seven-figure dollar investment via Lightspeed Partners in China.
Distributed company model
The ambitious-sounding project will not take the form of a company, in the formal sense, meaning it will not be subject to regular company laws, but will instead be governed purely through the alignment of incentives.
Play's own description of itself as a DAC reflects its aim to disrupt the existing company model.
The project seeks to raise 3,000 BTC by selling 20% of its total two billion total shares to global investors who, regardless of the jurisdictions they operate in, can invest in this project by sending bitcoins to the designated address.
As of 15th January, 2015, Play's website indicates it has raised 1,777 BTC – 59.27% of its target.
According to DACX, the shares investors buy will be tradable through BitShares' P2P exchange.
Trusting smaller developers
Speaking to CoinDesk, Zafed CEO James Gong explained Play's key value propositions.
One problem that hinders the success of small-chance game developers (games such as dice and online poker), he said, is the "trust issue".
While larger developers have stronger incentives to ensure fairness when their reputation is at stake, for smaller game developers such incentive can be easily overwhelmed by the prospect of short-term gain. Users, aware of the risk, tend to shun the latter as a result.
The proposed solution is what Gong calls 'on-chain games'. These are "games that run their entire logic on the blockchain and that are independent from any external centralized intuitions", he said, and will lead to reduction of trust-related risks.
The project’s white paper, which can be downloaded on its website here, elaborates more on the topic:
"Chance games have come to rely almost exclusively on trusted third parties to provide random feeds. While this system works well enough, it is based on a centralized trust model, and suffers from the possibility of cheating by players. Even thought some crypto based games on the Internet have probably random feeds, which can be verified by the public, hidden players can cheat by submitting selective favorable transactions because they know the random secret in advance."
Play has also described new types of games that will utilize the technology that it develops, although the company claims the games will be developed by third-party developers.
"The goal of Play is to afford the players with access to a rich variety of games on the Play platform, all to be provided by third-party developers. The platform will not only offer probability games, but also include more advanced games like betting on real events, chess games and board games."
It goes on to describe some games. One is a real-event betting game, otherwise known as a 'prediction market'.
Participants will bet on whether an event will happen, or how something will happen, in the future. For example, if a particular celebrity will get married or divorced in a specific amount of time.
"This data needs to be inserted into the blockchain, a job that can be done by 'delegates'. Because delegates are elected by shareholders, we assume the results of vote are reliable. If not, the consequence is shared by Play shareholders who elected the delegates, which means that it will fall on the whole community, in which case, it is still fair."
Building an economic system
Aside from the enhanced fairness and innovation in the games, Play also proposes to build an exchange platform to form a wider economic system surrounding them.
According to its white paper, "Play allows users to issue customized assets, which will be tradable on the platform of Play and can be sold for the crypto shares that Play issued."
Gamers will be able to buy and sell their game tokens and props on the exchange, which results in what the paper calls an "inter-server and inter-game P2P economic system".
Dice image via Shutterstock
In its prospectus, Play claims it offers a third-party verifiable mechanism to ensure true randomness and fairness for gamers by placing the games’ logic on the blockchain. This would remove the need for trust in centralized institutions, it says.
The startup will also offer a platform to […]