Simple Summary

Prode is a decentralized betting platform built using Reality.eth and Kleros and currently deployed on Gnosis Chain. Unlike other projects like Omen or Azuro where 1-question markets are created and supported by liquidity providers, Prode focuses on betting pools in which users bet on multiple outcomes and compete against each other for the highest prize. This is a very popular type of sports betting scheme that has been played across the world for many decades.

Prode was officially launched 1 month ago after 4 months of intense work and without any external funding. To bootstrap the first markets and kickoff adoption of the platform, the Gnosis DAO could sponsor the most attractive markets in exchange for some of the creator’s fee rights of the markets chosen. Additionally Gnosis DAO could provide funding to the Prode team to support the project’s development and advertising. In exchange for the funds, Prode commits to giving GnosisDAO 100k USD worth of governance tokens once the Prode token is released.

Motivation

1. Increase adoption of Gnosis Chain. We noticed that the onboarding of new users is an issue, because getting xDAI on Gnosis Chain for the first time is confusing and sometimes not very straightforward. There’s also a lot of competition among sidechains and L2s, and Gnosis Chain is not the most popular one.

2. Attract users and market creators to Prode. In the type of prediction markets Prode focuses on, users usually look for markets with potentially big prizes (a bit like a lottery). Initially, this is hard to achieve, because the dapp traffic is low and therefore there are no market creators advertising their market pools, and vice versa. One of the strategies to overcome this is to start creating markets ourselves and fund them with juicy prizes.

Specification

Total requested amount: 200k xDAI:

• 100k for sponsoring markets.

• 50k for the team.

• 50k for marketing.

Funds Allocation Details

Sponsor the following markets (100k xDAI total):

• FIFA World Cup Qatar 2022. 20k xDAI. Creator fees (5%) will be used to incentivize the referral program within this market.

• T20 Cricket World Cup 2022. 5k xDAI. Creator fees (5%) go to UBI Burner to support the UBI price and attract its community and supporters.

• F1 Grand Prix Japan & Brazil. 2.5k xDAI each. Creator fees (5%) go to GnosisDAO. Breakeven*: 50k xDAI each.

• League of Legends World Cup 2022. 5k xDAI. Creator fees (5%) go to GnosisDAO. Breakeven*: 100k xDAI.

• CS:GO BLAST Premier: World Final 2022. 5k xDAI. Creator fees (5%) go to a public good project TBD.

• Upcoming 30 weeks of the NBA. 15k xDAI evenly split into each week matches. Creator fees (5%) go to GnosisDAO. Breakeven*: 10k xDAI per market.

• Upcoming 30 matchdays of the English Premier League. 30k xDAI evenly split into each matchday market. Creator fees (5%) go to each subsequent matchday market.

• Upcoming 20 matchdays of the Argentinian football league. 5k xDAI evenly split into each matchday market. Creator fees (5%) go to UBI Burner to support the UBI price and attract its community and supporters.

• 5k xDAI will be converted to bet vouchers and distributed to active Proof of Humanity users instead of used to directly sponsor a chosen market. This will be important for a couple of reasons. First, it will signal what markets are preferred (at least by an active ethereum community). Second, it will bring activity and promotion to Prode. Last, it will help onboard Ethereum Mainnet users to Gnosis Chain.

• Similarly, 5k xDAI will be converted to bet vouchers and distributed to active bettors of Prode’s competitors, both from Gnosis Chain and other Chains.

*The breakeven point refers to the market pool size needed to recover the funds. It could be lower if significant royalties are generated or if other sponsors fund the market; it could be greater if a lot of users bet in the markets through referral links. A bet placed after entering the market through a referral link will split the creator fees in halves: 50% to creator and 50% to referral.

Team funding (50k xDAI). Although the team has been self-funding the project for the past 5 months and will continue to do so in the short term, this extra funding will allow the team to start working full-time on the project for the next 6 months. Prode is currently being developed by 3 devs from the Kleros community. Additionally, this funding would be enough to hire 2 interns for communication purposes and contract free-lancing design services for the front-end and Prode’s NFTs.

Marketing funding (50k xDAI). Sponsoring markets alone is not enough to attract users to Gnosis Chain and Prode. The 50k USD requested will be used as follows:

• ~15k xDAI will be used to partner with sports influencers/streamers/casters in order to promote Prode and its markets.

• ~15k xDAI will be spent in traditional online advertising services.

• Based on what is learned in the upcoming months, 20k xDAI will be used in 2023 Q1 to (1) sponsor strategic markets and (2) explore markets we haven’t considered yet.

PRODE Token

The Prode protocol generates fees from each market. The team is in the process of designing a governance token that will allow holders to manage the DAO’s funds and control some protocol parameters. Once the token is released, GnosisDAO will receive 100k USD worth of PRODE tokens. The price taken into account to calculate the distribution will be equal to the cheapest price the tokens were sold at.

Rationale

Prode markets tackle a prediction market niche that is currently unattended in the blockchain industry. On the other hand, most decentralized prediction markets platforms, which focus on single-event predictions, struggle to sufficiently incentivize liquidity providers. Prode markets don’t have this problem, because the prize pool is bootstrapped from bettors themselves. However, until Prode gets more popular and its market creator-bettor ecosystem consolidates, sponsoring key markets could help adoption greatly.

A bettor who is not familiar with Gnosis Chain and Prode might not be attracted to the platform if the prize pools are low. If attractive markets such as the FIFA World Cup market gets a 25k USD funding, this would be a huge incentive for new users to join the network.

2022 Q4 will be a time of very popular sport events. This is a huge opportunity to gain traction. Some examples:

• According to FIFA ~150 bn USD worth of bets were made during the World Cup 2018 held in Russia. We should try to capture some of this for the World Cup 2022.

• Cricket is a very popular sport in Australia, India, Pakistan and England, which constitute very big and diverse markets. In october the cricket world cup will happen.

• Esports have experienced a huge growth in the last decade and so have prizes and bets around its tournaments. People following esports - usually young, techy gamers - are a good fit for crypto/online bets, because they will deal better with the UX friction dapps have. There are some big tournaments coming and we should make the most of them.

• While big events attract a lot of users, they happen only a few times a year at most. It’s also important to incentivize smaller markets that can be played on a regular basis and thus create engagement in the long run. Football leagues are a good opportunity to test this out.

Implementation

Once this GIP gets approved, the ownership of the creator contracts of the markets mentioned above will be transferred to the GnosisDAO address on Gnosis Chain. Afterwards, either Prode’s team can administer the market funding on behalf of GnosisDAO or the GnosisDAO can fund the markets directly by calling fundMarket(“”){value: sponsoredValue} in each market. These operational details will be discussed with the Karpatkey DAO team.

5% of the pools’ xDAI, including the funds sponsored, will be rewarded to the creator address when the market closes. Additionally, if bets positions get traded in a secondary market that supports royalties, the creator address (GnosisDAO or UBI Burner) will receive 1.5% of trades as royalties.

The 100k USD requested for development and marketing will be sent to the Prode’s multisig, which will administer the funds, on Gnosis Chain: 0x0029ec18568F96AFE25Ea289Dac6c4703868924d.

Relevant links

• App: https://prode.eth.limo
• https://github.com/prodeapp
• Twitter: https://twitter.com/prode_eth