Discovering The Benefits of Blockchain Lotteries

Discovering The Benefits of Blockchain Lotteries

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Since the inception of lotteries, individuals have been trying their luck hoping to win a large sum of money that could completely change their lives. Currently, the market is completely dominated by national lotteries and a small number of private lotteries, who set the bar for the standards in the industry. The small pool of competition in the market has greatly limited customer experience and a number of problems persist in the industry. These problems help to highlight the benefits of blockchain lotteries.

The Problems of Traditional Lotteries

One of the first and most prevalent issues that have appeared within the lottery sector is a lack of transparency due to the fact that many systems and operations are centralized; the customer does not know what is going on behind the scenes. This lack of transparency has led to regular allegations of fraudulent behavior, specifically: winnings not being paid out to customers, mismanagement of random number generators. This does little to foster trust and repeat custom from users. An example of this can be found in the Iowa Hot Lotto scandal in 2017 where the Information Security Director Eddie Tipton confessed to rigging the lottery’s random number generator and was imprisoned for this crime.

Another issue that frequently appears in traditional lotteries is a byproduct of the old system, whereby many lotteries still require customers to purchase physical tickets to play. This is not always convenient and places a limit on the potential customer pool. Furthermore, national lotteries can experience limited player pools and prize pools as a result of only being able to conduct business in their locality.

There are also a number of issues within the traditional system for lottery operators. The costs of entering the market can be severe and even further, the costs of running an online platform can severely hamper the profitability of an online lottery platform. Because of the aforementioned issues for customers, it can also be difficult for new operators in the market to gain a sizable customer base due to a lack of trust and credibility. Finally, new players in the industry rarely have the capability to offer large jackpots to their customers on a frequent basis, which makes it a struggle to attract potential customers to their platform.

Why Blockchain is The Solution

By running a lottery using a blockchain platform, lottery providers are able to solve almost all of the problems faced by themselves and their customers. Due to blockchain technology’s open distributed ledger system, all transactions and procedures on that blockchain will be transparent. This helps to foster trust and credibility for a blockchain lottery, which will greatly assist in generating new customers. Also, blockchain technology helps to eliminate the problems of inclusivity that plague many lotteries, due to the fact that anyone with internet access is able to join. As a result of this, blockchain lotteries have the capability to draw on customers from across the globe, increasing usage rate and profits.

Lotteries tend to be very isolationist activities, but that does not have to be the case with blockchain lotteries. For example, Lotto Nation’s platform, which recently experienced a pre-IEO allows people to create their own lottery, whether you are an individual, a business, or a charity, and the platform allows you to play lotteries with a select group. This adds a social component to the lottery and the use of smart contracts on the blockchain assures transparency and fairness for all parties. This can also benefit businesses who can white-label the platform and operate an online lottery at a minimal cost.

A blockchain lottery also provides customers with reassurance that they are not being scammed, due to the fact that smart contracts between the provider and customers can never be altered, but they can still be viewed publicly. This means that customers have an avenue to decipher whether the winnings are being distributed as advertised.


From the examination of the capabilities of blockchain technology to augment and stimulate the lottery sector, it was found that a blockchain system could be implemented and it would resolve a large majority of the problems of traditional lotteries, not just from the business perspective, but also from the perspective of the customer. Blockchain lotteries have the opportunity to make a huge splash in the lottery sector, so long as the benefits are adequately marketed to both parties.

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