BetHog: Prospecting on the crypto gambling frontier
In 2007 Nigel Eccles launched an online political prediction market called Hubdub, which by 2009 had evolved into the fledgling daily-fantasy-sports platform FanDuel. Eccles has always been at the frontier of the evolution of online gambling.
One could argue that the latest frontier is crypto. Much like DFS did then, crypto occupies a space on the periphery of gambling, at least in the regulated market. That is where Eccles is now, at the helm of his latest venture, BetHog, which launched in November 2024.
BetHog is unable to operate in any regulated markets due to it being a crypto gambling platform but is thriving – along with many other crypto gambling operators – as an offshore operator. In fact, figures from Yield Sec released late last month revealed that BetHog is part of an US$81.4 billion industry, with the biggest crypto gambling operators rivalling the traditional casinos in scale.
“I don’t know of a single regulator in the world that allows casinos to take crypto, which is insane, it’s a US$4 trillion asset, which is liquid,” Eccles says. “It saves the operators an incredible amount of money in payments processing.”
Cheaper transactions on the blockchain
BetHog, like other crypto casinos, manages transactions on a blockchain. Eccles uses Solana, a proof-of-stake blockchain, capable of processing many more transactions per second than rival blockchains like Ethereum, and with far lower transaction fees.
Using his former company FanDuel in the US as an example of a regulated operator with eyewatering payments processing costs, Eccles tells me it spends 12.5% of its revenues on payments. “So that’s US$700 million on payment processing,” he says. “I’m on the board of another company that spend 20% of their revenues on payment processing. What’s even more insane about that is, with crypto it’s zero.”
Cost isn’t the only inefficiency that Eccles highlights in traditional online gambling, compared to crypto platforms. He says the level of regulation is also responsible for slowing down the pipeline of new products, stalling innovation.
“Some of the regulation has been bad for the industry, and that’s created barriers to innovation that haven’t benefited the users at all,” he explains. “For example, we’ve developed some casino games in house, and we can just build and release them. For my friends in regulated businesses, it’s much quicker to develop them than it is to get the approval to release them.”
Eccles says in the regulated market you might spend two months developing a game and then a year trying to get it released. “And there’s no benefit to the user,” he says. “We design the games, and if there are ever any issues, we fix them. It just feels that regulation’s unnecessary, because it’s in our interest for the game to be fair and slowing down that time to market just means that the innovation happens offshore.”
Bringing new games to market
Two recently launched in-house games, are Jump! and Hogger. Jump! is a squirrel themed stepping stone game where up to 30 players scramble up a tree riddled with hidden traps. Each round you pick seven jumps to try to make it to the top of the tree beating your rivals and potentially winning the jackpot.
Hogger is a road crossing game where you try to help a hog navigate crossing a busy highway. The further you travel the higher the potential payout but one step too far and hog gets squashed. The two games are unique in that they both allow for synchronous play, so streamers can play along with their fans.
Elsewhere, Eccles says the platform is excited about the possibilities offered by what it calls “meta gaming”, essentially a layer of gamification that exists beyond the big-name slots offering. One example is a twist on a fairly ubiquitous crypto casino feature, in which the customer that plays the most each week wins a reward.
On BetHog, there is a similar reward but instead of it just being the most frequent player or the one making the biggest bets (which will likely be the same person each week) players accumulate entries to a lottery each week, the more they play the more likely it is they win, but ultimately anyone could win the lottery.
Asked whether he would like BetHog to move into the regulated markets in future, he says of course he would. Ultimately, there is money to be made in those regulated markets and entering them is an opportunity for massive growth, but at the same time he remains cautious about the impact that might have on the character of the product and continuing to innovate and offer players what they want.
“We don’t operate in regulated markets at the moment, we focus on countries that are unregulated. As we get bigger, we will want to come into the regulated market. But it’s really whenever we feel the product is more mature and stable. At the moment we really want to be releasing new products very quickly.”
He says to continue adding games at the speed the casino is now would be impossible in a regulated market. But if the platform where to reach a scale more akin to crypto rival Stake for instance, he says, then entering regulated markets in Europe, the US and Canada might hold more appeal.
Hoping for a smoother regulatory path
What is promising in Eccles’ view is that President Donald Trump’s administration is far more crypto-friendly than Joe Biden’s was. “The way the last administration approached the crypto was highly disruptive,” he says.
“It meant they sued all of the legitimate operators who were trying to do the right thing, and then totally ignored all the fraud. So crypto became this haven for fraud. Instead of what they could have done, which is say, ‘let’s work with the industry. Find rules that work for the good actors in the industry, and let’s go after the people who are scammers.’”
Eccles recognises that fraud is an issue, but he argues there are already laws in place to deter and punish it. “What we’re hoping, with the new administration, is it works with the industry, to put in sensible regulation,” Eccles says.
“We can operate, Coinbase can operate, but it goes after the fraud. There should be clear rules that will work. The industry just wants some rules of the road. There are certain people in the industry who want no rules. But I think most of the industry thinks ‘we’ve seen that, and it’s not good. We are all for sensible regulation.’”
Ultimately, Eccles sees crypto as an obvious adjunct to gambling. Whether the rest of the industry is ready to adopt it or not, he is full steam ahead on positioning BetHog as a leader in the market, so when everyone else does decide to line up on the grid, he’ll be in poll position… again.
Dig deeper
Verticals:
Sectors:
Topics:
