As a decentralized, peer-to-peer sports betting system, ZenSports doesn't handle the submitting/settling of bet results. Everyone within the ZenSports ecosystem has a role to play in ensuring that everything runs smoothly and fairly. ZenSports has created a set of rules, deadlines, and a penalty/reward system to ensure that all bettors within the marketplace act in good faith.
Here’s a summary of how the decentralized system works:
- When a Maker creates a bet, the amount of the bet plus a 2.5% betting fee for USDT and BTC bets will be deducted from the Maker's Available Balance. If you're creating a bet in SPORTS tokens, the betting fee is only 1%. In addition, a 10% escrow fee for potential disputes will be deducted from the Maker’s Available Balance (the escrow fee is reduced to 5% when creating a bet in SPORTS tokens).
- Makers are the ones required to submit bet results when the event is over. Makers have 24 hours to submit results after the event has started for single day events (such as a single basketball game), and 24 hours after the last day of an event after multiple day events (such as a golf tournament).
- If the Maker doesn't submit results within 24 hours of the above event, then ZenSports by default awards the Taker as the winner of the bet. This can't be undone, so it's important as the Maker of a bet to submit results within the 24 hour deadline. ZenSports sends out 3 email and push notification reminders to Makers to remind them to submit results.
- If the Maker submits results that the Taker is the winner of a bet, the escrow fee that was originally withheld when the bet was created will automatically be refunded back to the Maker, and the Taker will receive his/her winnings.
- If the Maker submits any other result besides setting the Taker as the winner, then the Taker has 24 hours to dispute those bet results (the 24 hour clock starts to tick from the from moment the Maker submits results).
- If the Taker doesn’t dispute the results within 24 hours of the Maker submitting results, then the full bet winnings plus the escrow fee will be credited back to the Maker.
- If the Taker submits a dispute and loses the dispute, the full winnings, Maker escrow fee, and 50% of the Taker’s escrow fee will be paid to the Maker (so the Maker will earn a bonus of the Taker’s bet amount as a reward for a false dispute submitted by the Taker).
- When a Taker accepts a bet, the amount of the bet plus a 5% betting fee for USD and BTC bets will be deducted from the Taker's Available Balance. If you're accepting a bet in SPORTS tokens, the betting fee is only 2.5%.
- If the Maker submits results that the Taker is the winner of a bet, the Taker will automatically receive his/her winnings right away, and can’t submit a dispute at this point (Takers aren't allowed to dispute that they won).
- If the Maker submits any other result besides setting the Taker as the winner, the Taker has the opportunity to dispute these results. This includes Tie and Postponed event results. Disputes must be submitted by the Taker within 24 hours after the Maker submits results.
- If the Taker disputes results within 24 hours, a 5% escrow fee for potentially losing the dispute will be deducted from the Taker's Available Balance when the dispute is submitted (the escrow fee is reduced to 2.5% when disputing a bet in SPORTS tokens).
- If the Taker wins the dispute, the full winnings, Taker escrow fee, and 50% of the Maker’s escrow fee will be paid to the Taker (so the Taker will earn a bonus of the Maker’s bet amount as a reward for incorrect results submitted by the Maker).
- If the Maker doesn’t submit any results within 24 hours of the bet event being over, then the Taker will automatically win the bet and receive all bet winnings (with no eligibility for disputes).
Ties and Postponed/Cancelled Events
- In the case of a Tie or Postponed/Cancelled outcome, both the Maker and Taker will receive the original amount of their bet back immediately after the Maker submits results (assuming no dispute by the Taker). The original Maker betting fee (2.5% for USD / BTC bets and 1% for SPORTS bets) and the Taker betting fee (5% for USD / BTC bets and 2.5% for SPORTS bets) charged by ZenSports will not be refunded in the instance of a Tie or Postponed/Cancelled event. However, the Maker escrow fee will be refunded back to the Maker in either case.
This decentralized, penalty and reward system has resulted in less than 0.1% of all total bets accepted resulting in actual disputes. Makers are incentivized to submit correct results in the first place, otherwise they’ll lose an additional 5% to 10% beyond their original bet amount. Takers are incentivized not to submit false disputes, otherwise they’ll lose an additional 2.5% to 5% beyond their original bet amount. This system has worked great so far in ensuring that all bettors within the marketplace act in good faith.
In case there ever is a dispute, we are ultimately going to create a "voting system" that will let the rest of the marketplace decide on whom the winner of the dispute is. Since disputes have been very rare up to this point, we have yet to build out this voting system. In the meantime, the ZenSports internal team will resolve any disputes that should arise.