Sports Betting is Huge and Betswap.gg (BSGG) Capitalizes on That

Sports betting is a massive and fast growing industry. It’s estimated that the worldwide sports betting industry will be worth around $700 billion per year in 2026. 

With growth like that, many different sports betting platforms have popped up over the past few years. The basic concept is generally the same on all of them – bettors can place bets on the outcome of sporting games on the platforms. However, smart contract enabled blockchains are a perfect for sports betting. The smart contract will automatically execute once it receives the results, which makes it a trustless system. The money is essentially held in escrow in the smart contract until the contract receives the data inputs. 

Anyway, there have been a decent amount of sports betting platforms on the blockchain over the years. None of them have really seen much success. One of these platforms is called Betswap.gg and it works a little different than your standard online sports book. We’ll explain how Betswap.gg works in this article along with offering our opinion on whether or not this project is a good investment. 

What is Betswap.gg?

Betswap is a little different from the standard sports book. It’s actually a sports betting exchange, which allows users to choose whether they want to be a bettor or bookmaker. Basically, they can sell bets on the marketplace for users to take and Betswap takes a 1.5% commission.

It’s a more fair system than a typical sports book. 

Now, Betswap is a multichain project – it’s mainly on Ethereum, but it’s also on Fantom and Avalanche. Bets are placed in the stablecoins, so there’s no need to worry about cryptocurrency volatility when placing bets. 

Where Does The 1.5% Commission Go?

The 1.5% commission is disbursed to three different places. ⅓ goes to the staking reward pool for the governance, ⅓ goes to the team, and ⅓ is used to buy and burn the governance token (BSGG). 

What Problems Does Betswap.gg Solve?

Betswap.gg solves a few problems in the online sports betting industry. These problems include the following:

  • The KYC process is required on standard sports book exchanges and bookmakers.
    • Betswap users do not have to undergo identity verification. This is a massive positive.
  • Transferring funds to sportsbooks is a problem as many banks block those transfers.
    • This is not too big of a problem Betswap. However, some centralized exchanges will ban your account if you send crypto to a known sportsbook crypto wallet.
  • Bet limits for sharps (winning bettors). 
    • Betswap requires no verification, so sharp bettors can use it with no fear of being banned or limited.
  • Sportsbooks take a commission.
    • Betswap does take a 1.5% commission on all bets. But this is far lower than the commissions that other online sportsbooks take.

Our Problems with BSGG

We do not actually have many problems with the Betswap platform as described in the whitepaper. It’s actually a decent project. 

Our problems lie with the execution of this project – it’s a staking token that uses a compelling story of a sports betting market to entice users to stake their tokens. 

It’s a Staking Token

As mentioned previously, our biggest problem with BSGG is that it’s a staking token. The APY they offer is far too high for the project to be sustainable. The rates are the following:

  • 30 days staking – 79% APY
  • 90 days staking – 144% APY
  • 365 days staking – 180% APR

We know that cryptocurrency has higher APY than standard investments, but not project is sustainable with a 79% APY or 180% APR. 

Lofty Goals in The Whitepaper

The whitepaper for Betswap.gg is actually well done. But they do have some lofty goals that we view as overly ambitious.

This is strange considering the founder is Martin Clarke, who has experience in the online bookmaking industry. Anyway, some of the aims for the platform mentioned in the whitepaper include:

  • A play to earn game.
  • Betting liquidity pools.
  • Social betting for tips.
  • A fantasy sports platform.

Betting liquidity pools, fantasy sports, and social betting are not too ambitious. But what is a sports betting marketplace doing talking about launching a play to earn game? 

No one on the team appears to have any experience in the gaming industry. It’s ridiculous to say they want to launch a play to earn game with such a lack of experience. 

Too Much Venture Capital Funding

Betswap.gg raised a lot of venture capital funding – $18.2 million worth to be exact. 

Newcomers to cryptocurrency view that as a good thing because institutions are backing the project. 

That’s not really the case, though. Venture capitalists receive tokens at a heavily discounted rate and often sell the moment they can sell, which crashes the price. This has happened to so many cryptocurrencies. 

It gets worse, though. Betswap.gg received funding from Wonderland DAO. For those that don’t know, it was revealed in January 2022 that ex-Quadriga co-founder and convicted identity fraudster Michael Patryn was the treasurer of the DAO. Quadriga was a Canadian cryptocurrency exchange that defrauded investors of nearly $200 million USD.  

Wonderland invested in a lot of startups at the time, so this isn’t a massive red flag. It’s still not something we like to see, though. We tend to avoid Wonderland and any projects associated with Wonderland after the Michael Patryn revelations were made public. 

Is BSGG a Good Investment?

We really like the idea of Betswap. But we do not view BSGG as a good investment. The price action of the token does not look great – it’s gone down in price since its launch and has lost over 99% of its value. 

The token launched at a price of $1 on January 12, 2022 and currently trades under $0.01 on October 27, 2022.

We simply cannot support a token that has dropped in price that dramatically. 

The other reason we are hesitant about investing in this project is the high staking reward. 79% APY for 30 days is unsustainable as it inflates away the value of the token.

bsgg staking

Final Thoughts

That covers it for everything you need to know about Betswap.gg. This looks like another staking token. It does offer an interesting platform with peer to peer betting, but we cannot recommend it as an investment due to the crazy APR and APY for staking the token. 

Sports Betting is Huge and Betswap.gg (BSGG) Capitalizes on That