Lee Davy sits down with Ryan Gittleson of Virtue Poker to learn why the new P2P decentralised poker platform is about to shake the poker industry like a rag doll.
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Virtue Poker is a peer-to-peer decentralised poker platform built using Ethereum.
I know what you are thinking.
I sound like Scotty talking to Spock on the Enterprise.
It’s complicated; it’s confusing, and it scares the hell out of me. But if I have learned one thing late on in life it’s to do the very thing that frightens me. So, I sat down with Virtue Poker’s Ryan Gittleson to try and learn how to speak Vulcan.
Why are you doing this?
“First and foremost, what we are trying to do is bring innovative technology to an industry that has not seen that much innovation in the past ten years.
“The core properties of what we are doing, building on top of the Ethereum Blockchain, include transparency and trustless asset transfer. Properties that I think will be beneficial for the poker industry as a whole.”
Why are you the right team to do it?
“Virtue Poker is a project out of the Venture Production Studio called Consensys. The founder of Consensys is Joe Lubin. He was a co-founder of Ethereum which is a next generation blockchain solution. He started Consensys a year and a half ago with the goal of building decentralised applications that use this new technology. We are the spoken of as the thought leaders in this space and employ a network of engineers north of 100 people spanning the globe. We are not only working on poker but a host of other products as well.”
What is blockchain technology?
“The easiest way to describe the benefits of a blockchain is to use poker as an example. A lot of what we are doing doesn’t even touch the blockchain. It uses what is called The Mental Poker Protocol which is an encryption scheme that allows a series of individuals at a poker table to collectively shuffle a deck of cards without a centralised server involved in the process. Every single peer and machine in this subnet are responsible for shuffling the deck of cards, so you don’t have to rely on a server located in a far off country with a random number generator.
“The blockchain is used to escrow tournament buy-ins. If you, me and Bob were to play poker, we each send ten ether (a cryptocurrency) to what’s called a smart contract which can be described as a cryptographic box which only unlocks when certain criteria are met. This contract sits on the ethereum blockchain, holds all of our money and waits for the game to be played. When the game is finished, and there is a winner declared that contract executes and pays the winner directly into their digital wallet. There isn’t a deposit or withdrawal process with Virtue Poker. The way it interacts is you have the digital wallet, and essentially we are bringing the live experience online. When you go to the casino you give them cash, get your chips, and when you win you exchange your chips for cash, and that’s it. There is no delayed withdrawal process. With us, it only takes 17 seconds to cash out.”
Why is now the right time to start?
“The unique property of Ethereum is this concept of smart contracts. Ethereum was released a year ago, and Ethereum is what enables this new capability to exist on Virtue Poker where you have full custody of your money. We are poised to disrupt the industry in a way the poker industry has never seen before.
“People are sick of the available options that are out there. PokerStars have dominated the space for the past decade, and it’s now ripe for new entrants in our opinion.”
It is ripe because of the way PokerStars have been treated their professional player base?
“Absolutely, PokerStars eliminated their Supernova program. I think they are making a big mistake that a lot of companies do. They aren’t listening to their customer. At Virtue Poker our aim is to be a customer centric platform that hears their needs and wants and responds to them.”
It sounds perfect so why aren’t the big online poker rooms using this technology?
“It’s a new technology. Ethereum was in relative obscurity until the beginning of this year, and it caught wind largely with financial applications. I doubt it’s even on their radar yet. They may be aware of Bitcoin, but it’s the underlying technology where the innovation lies.”
I recently reached out to the top online poker rooms for their thoughts on cryptocurrency and formed the opinion they don’t believe it’s something their customers wants.
“It’s funny that you bring that up. I have been doing a lot of research with poker pros, and people like Bitcoin as a mechanism for depositing and withdrawing money because of the lack of payment processing fees. There is a steep learning curve in understanding the values that a cryptocurrency and blockchain system can provide and we just need to educate people. Once they see it, they will desire it and want to use it on their platforms.”
What problem are you solving?
“The biggest issue is the trust issue. The industry has come a long way since the Absolute Poker and Ultimate Bet scandals, but there is still a lingering perception: ‘should I trust a platform with my bankroll’, ‘is the game fair?’ These perceptions exist even independent of whether they are true or not. And that is tainted the industry and done irreparable damage, and I think a solution like this allows for fair gaming. Everyone is involved in the shuffle, and you don’t have to trust us with your money. It will innovate the whole industry.”
Who is it for?
“Initially for the first release of the platform, you will only be able to conduct wagering using cryptocurrency so most likely the currency will be ether – the token used on the Ethereum blockchain, and we will most likely have Bitcoin availability as well. It will be a niche product starting out for the cryptocurrency enthusiasts. A lot of the high stakes players will like it because you don’t have to deposit $50,000 on PokerStars and got through the player transfer process to aggregate all of that money. Part of our marketing strategy is to enlist well known online and live pro poker players and get them to play on Virtue and showcase the games on Twitch. A lot depends on where we end up getting our initial gaming license. Most likely we won’t be able to offer this service to American residents or Black Markets but that part of the strategy we are still figuring out.”
What are the added complications with cryptocurrency that doesn’t exist with real money when applying for a gaming license?
“Luckily the UK has been very forward thinking with their classification and understanding of online gambling platforms that use cryptocurrency. Thay have a well-established regulatory regime, but largely it’s an education process. First, we have to educate the regulators on what a blockchain is and how does the poker player use it as part of their stack. One of the cool things about the blockchain is transparency. There is a chain of activity on the blockchain recording all the results, so it will be an attractive solution for the regulators when they get their head around it.”
What will customers say to their friends to recommend Virtue Poker?
“This is an amazing platform. It has seamless withdrawal and deposit options. The game is smooth and has a better user interface than the stagnant interfaces that have ben out there for so many years. It’s a new cool, innovative solution for the poker industry. The industry has been stale for the last decade because the same players have dominated it. There has been no incentive to innovate instead they have taken a step backwards by the way they have alienated their customers. Getting rid of a program {Supernova} that a lot of people use to support their livelihood is not a good move, you are not listening to their wants and desires. We want to be there for the poker player. We don’t want our platform infested with bots; we want to prevent collusion, and we want a level playing field so a recreational player would feel comfortable playing on Virtue Poker.”
What are you really selling here beyond your product?
“Integrity. We want to bring back trust to an industry that has been rocked by scandal. We want to show that a blockchain based solution can add value to a well-established industry and show this is a beginning of a technological revolution as more and more decentralised applications come out that use Ethereum or other blockchain solutions as part of their stack.”
What weakness will get in the way if you don’t address it?
“The biggest thing we are up against is adaptability. This isn’t going to be a platform where you can use a debit card or a Neteller account. There will be a learning curve to use cryptocurrency to play on our platform. But luckily it’s not foreign to the industry. A lot of platforms have added Bitcoin as a deposit and withdrawal option and a lot of people in the poker community have started interacting with digital wallets and solutions in our ecosystem. The other problem is the giant elephant in the room – marketing resources. We don’t have a hundred million dollar annual budget, but we hope to overcome that obstacle by getting reputable pros to like our product, and we have already begun a lot of those conversations.”
Why is cryptocurrency perfect for poker?
“Payment processing is a thorn in the side of the poker industry. The restrictions and hoops you have to go through to get money on and off a site is a headache for both parties. That’s a blockchain speciality. Bitcoin was invented as digital money that can move freely around the world; instantly and at no cost. There won’t be a 5% withdrawal fees on Virtue Poker. We are eliminating that headache and cost. It will be attractive to both us as a business and our players.”
What will success look like next year and in five years?
“By the end of next year we want to have released our product; have people using it and getting customer feedback. We are not naive enough to think we’ll get this right first time but we want to get people interacting with our product, using cryptocurrency and understanding how blockchain works. We don’t see this as only an application for the poker industry but a tool for a wider base understanding and adaptability of Ethereum and blockchain systems as a whole.
“Five years out we aim to be able to have solved the trust problem in poker and have happy customers who feel that the game has been reinvigorating, not bot infested or shark ridden.”
What promises do you want to make and keep?
“The first and foremost is we will always listen to their feedback. We are not out here to be another cash hungry money grabbing platform. We’re here to solve some of the problems that plague this industry, and we promise to listen to then,”
What’s your difference?
“Transparency and trust.”
