Cryptocurrency gamblers have left Ethereum-based decentralized apps (dApps) en masse. They’ve converted almost entirely to gambling on competing networks, taking their transactional volume with them.
Blockchain research unit Diar studied three blockchains that support dApps, Ethereum, ETH EOS, TRON, to determine just how much US dollar value is processed on each network – and by what kind of dApp.
It discovered that dApps deployed on EOS and TRON are now responsible for 94 percent of all the US dollar value transacted across the three protocols.
Most of it is the result of gambling. Since its rocky inception last year, the EOS network has processed more than $5.5 billion worth of cryptocurrency – with 70 percent now attributed to its gambling-specific dApps.
TRON traffic is made up of a similarly startling amount of online casinos. Diar noted more than 95 percent of TRON traffic is gambling-related.
By comparison, Ethereum‘s gambling dApps now account for a relatively tiny 2 percent of the network’s US dollar transactional volume. This is despite nearly half of Ethereum dApps being betting-related.
Instead of gambling, a lot of Ethereum traffic is made up of cryptocurrency trading on decentralized exchanges – but analysts found even those are struggling to maintain rates of adoption.
Diar claims gambling is “inherently high-volume trading.” This means any blockchain hosting gamblers will inevitably see a disproportionate rise in “on-chain” USD traffic.
Gambling dApps have been soft targets in the past
EOS-based gambling dApps were once notorious for security incidents, after string of coding failures rocked a number of betting platforms.
The troubles started in the months following its launch, when a hacker exploited “decentralized” dice game DEOSGames to “win” its $1,000 jackpot 24 times in a row.
Less than a week later, attackers ransacked rival dApp EOSBet, hacking its poorly-coded smart contract to steal 40,000 EOS, worth over $200,000 at the time.
In the days beforehand, EOSBet ironically bragged about the robustness of its security on social media. It was then hit by thieves again – this time estimates suggest they made off with $338,000 in EOS tokens.
While proponents of EOS and TRON might laud the adoption of their blockchain by the internet’s decentralized gamblers, the success of those dApps hinge almost entirely on the security of their smart contract code – so they had better be ready for the inevitable attack.
Published January 29, 2019 — 17:18 UTC