I often feel like I’m missing a key piece of technological or intellectual insight when I read bullish articles like the linked one. I cannot see a single use-case in there that would definitively be improved by the use of blockchain, and in most cases, I’d expect the opposite to happen.
What do you think about cryptocurrency enabled sports betting and prediction markets? There's a pretty clear technical path to these replacing traditional sports betting market makers and I personally cannot wait. Current market makers like DraftKings still put out betting lines with insane spreads, because in the US atleast, their markets are protected by regulatory capture.
This [1] is one of the projects I have my eye on in this space but there is many that are starting to get to work now that a lot of the technical issues around Oracles are being sorted out.
Since the use of an oracle introduces a source of information external to the blockchain, we’re left with centralization issues again. I feel like this removes the unique advantage of using the technology in the first place.
I suppose there are ways to gamble exclusively using the blockchain, but I don’t think sports betting is among them.
Suppose they use a fully centralized oracles, isn't there still a huge benefit in having much lower fees and tighter spreads, even if it's not decentralized? For the end user, having settlement, custody, and market making decentralized while having centralized oracles is still a huge advantage.
Then consider that people are tackling the issue of decentralized oracles. The most common platform for that is Chainlink [1]. In this space specifically, Augur [2] is among those who has attempted to make decentralized sports reporting Oracles. I'm not sure if their solution is fully fleshed out, but regardless it doesn't seem to be an insurmountable technical issue for something that is as easy to verify as outcome of a game.
If your willing to accept that the Oracle problem will be solved, I'm not sure how you would say this doesn't create value for consumers.
I think partial decentralization would introduce the worst of both worlds: you might place your trust in a small number of potentially malicious actors (external centralization), yet they’d only be subject to on-chain rules and regulations (internal decentralization).
Of course I’m aware that there are attemps to incentivize oracle providers to play fairly (and even “decentralize” oracles), but I don’t quite see how it can be definitively resolved. Not saying it’s impossible, but I just don’t see it (or understand it) yet.
