SX.Bet | Complete 2023 Guide [Betting-Staking-Mining]
What is SX Network?
From what I understand, SX Network with the SX Currency is a Blockchain which is a side-chain on Polygon. This means gas fees are paid in SX making them extremely cheap (near free) while the security of the network is borrowed from the Polgon Chain. All this allows for a betting application that is decentralized enough, secure, fast and cheap so many transactions can be done by market makers while bettors don't lose money by paying gas fees. ( See Whitepaper)
The SX token is used in a way where Validators need to stake to keep things running earning fees generated by the betting exchange. Everyone also can stake SX and delegate it to Validators to get their share of the fees. Staking SX also gives discounts for those making the market placing limit orders and it's used for Governance and as a token to pay gas fees with.
What is SX.Bet?
SX.Bet basically works like Betfair in a decentralized way. Players can bet and trade directly against others and a certain % of their winnings (between 0.25% and 2.00%) is taken as a commission for using the platform on any given event. (So with multiple bets it only takes a fee from the net profit an no fee when there is a loss). Those who take offers that are on the site always pay 2% Commission (or 5% For Parlays) while those who put up offers can lower this down to just 0.25% with enough SX Staked.
Right now, I assume the SX Devs are running a market-making bot that takes odds from Pinnacle and puts them on SX.Bet at just slightly lower odds. Things adjust rather quickly so it's not really possible to exploit line movements and it actually is nearly always better to just bet on Pinnacle which should change when more players are onboarded onto the platform and there is the advantage of the decentralization being able to bet directly from your own wallet. Bets can be placed in USDC (The majority) but ETH and WSX (Wrapped SX) is also available.
SX.Bet Positives
- It Just Works Properly very similar to Betfair one you have it set up.
- Decentralization where you don't need to make deposits.
- No KYC or User Restrictions
- Passive Staking Earnings!
- There is Bet Mining which earns users SX based on their winnings
SX.Bet Negatives
- It is somewhat complicated, especially for non-crypto native people
- It needs a lot more users for there to be more competitive odds
- Only 4.2% of Token Supply is staked so likely future pressure on returns
- Bet Mining is inflating the supply
1. How To Place Bets on SX.Bet
SX.Bet allows an 'Account Creation' by just logging in with Metamask (Polgon Network, or SX Network) and signing a message (No Cost). In order to bet though, you will need to Bridge USDC (or ETH / WSX) from Polygon to the SX Network.
The SX Chain can be added in Metamask with the following info.
Important! in order to be able to transact on the SX Blockchain, you need SX as gas token. SX Can be bought on different exchanges (Sharkswap is the native exchange running on the SX Blockchain).
I'm sure it's possible to ask for someone to send over some native SX in order to do enough transactions on their discord if you don't want to take this step and I assume some kind of solution will be found to make this part of the process more user friendly. Once you have some SX on the Polygon Chain, go to https://sx.bet/wallet/bridge where it easily can be bridged into SX on the SX Network.
Once this is done, you will have enough to pay gas fees and you no longer need to worry about that as they are so small that you will last forever with even just a dollar. It is now possible to bridge USDC from Polygon to SX Network which will allow you to bet. I think there is a 0.1$ fee for converting USDC to SX and 5$ the other way around when 'withdrawing' USDC from SX Network back to Polygon.
Once these staps are done, you have SX to pay gas fees and USDC to place bets. There is a minimum stake size of 5$ and the first bet you take must be a market bet since the system needs to do some things in the background before you are able to put in limit orders which it does this way.
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You can either take a Market bet taking odds that are currently offered on the market which instantly will get accepted or take a limit bet where you offer bets on the market and that only will be taken up when someone else takes them. On Market bets, you always pay 2% while for limit bets it's possible to get a discount on those fees based on how much WSX you have staked. The bet slip will also state the estimated SX you will earn in case your bet wins.
On the my-bets page, you are able to see your pending, Settled, & Offered bets.
Bets are settled really quickly after the event is over and I never had any issues so far.
2. How To Stake SX and Earn Platform Fees
100% of the fees generated from fees paid on winnings are distributed toward Validators and Stakers with 20% of the earnings from stakers going to the validator they stake their coins on.
SX & WSX
In order to stake SX, you first need to convert it into Wrapped SX (WSX). I assume it works this way to separate the gas token from the token that is staked. This can be done for free on the swap page. Once you have your WSX, you can go to the staking page and choose the validator you want to stake on and do so.
Right now there are just 4 Validators all from the SX Team as they are still rolling everything out. Soon it will be possible for others to also become a validator. It is still very early on and there are only 131 delegators in total with ~42M SX Staked by validators and stakers.
Earning & Claiming Rewards
Right now, on average there are around 1 Million Winnings weekly on the platform which fees are calculated on and I'm still gathering the data to make more accurate estimations on what the actual returns will be. Last week this was +21.55% APY but since more SX is being staked compared to an overall volume increase it seems to be going down a bit.
The earnings generate as fees are collected and they can be claimed at any given time with an option to Swap & Compound. For more info on actual returns, check my weeky GambleFi Portfolio Report on my Hive Blog
3. How To Mine SX
Each week there is a pool of 70,000 WSX tokens (which comes as part of the total 1 Billion Max Supply) which gets distributed at the end of the week to players on the platform based on their winnings & Fees generated on the platform. So in theory, if you act as a market maker trusting that the betting markets are efficient (like the market maker put in place by the SX team) you should be able to at least play with a break-even expectation while you will earn WSX in the process
This acts as an incentive for players to use the platform and should help adoption as if more people use the platform, more fees are generated which increases the value of SX which increases the incentive for players to bet, ...
SX Price Prediction
When it comes down to making any price predictions it is really hard. The Maximum Supply is 1 Billion while around half is supposed to be in circulation.
The fee generation right now I estimate at around 8000$-20000$ on a weekly basis with the potential to go up a lot more in case the platform gets some major adoption. This however still is a big question mark and at 132M Fully Diluted Valuation deep in the bear market it can hardly be called cheap given the risk. Given the more decentralized nature of the platform, I'm aiming toward 12%-20% APY currently as fair value. I have my 25000 SX as a long-term bag and if data shows it's undervalued I will likely buy some more.
Conclusion
SX.Bet is not the platform that I personally would use the most right now since they don't have the Belgian League while odds generally are lower compared to what I have available. Yet I am impressed with the progress that has been made and the overall potential of the platform which should be able to rival Befair as a decentralized option. Right now, I'm more of an investor taking a small gamble on them succeeding and I will continue to gather more data along the way. The dev team also has looked really reliable which is always a key factor in these types of projects.
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To be a validator the requirement is high with 200000 SX which represents around $25000 US!