Cardano Millions: a competitive and transparent lottery for everyone

[GENERAL] Name and surname of main applicant

Manh Nguyen (Danny)

[GENERAL] Email address of main applicant

danny.nguyen.2702@gmail.com

Additional applicants

Thuy Hoang, Mazen Khaddaj

[GENERAL] Please specify how many months you expect your project to last (from 2-12 months)

7

[GENERAL] Please indicate if your proposal has been auto-translated into English from another language.

Yes

[GENERAL] Does your project have any dependencies on other organizations, technical or otherwise?

No

[GENERAL] If YES, please describe what the dependency is and why you believe it is essential for your project’s delivery. If NO, please write “No dependencies.” .

No dependencies.

[GENERAL] Will your project’s output/s be fully open source?

Yes

[GENERAL] If NO, please describe which outputs are not going to be open source. If YES, please write “Project will be fully open source.”

Project will be fully open source.

[METADATA] Category of Proposal

Gaming

[IMPACT] Please describe your proposed solution.

Like centralized services, traditional lottery games have trust issues, and here are some problems we have identified:

• Transparency: The value of lottery prizes is based on ticket sales revenue, but it is difficult for us to verify the actual number of tickets sold for traditional lottery games because they are centrally managed by organizations and governments.
• Fairness: Lottery players may question the possibility of manipulation or fraud in the games. For example: 
• Is the random number generation method safe and truly random? 
• Are the jackpot winners real? 
• Are the prizes paid out on time? 
• Is the jackpot accumulated properly? 
• Traditional lotteries cannot provide satisfactory answers to these questions, resulting in a lack of fairness in the system.
• Limited access: Due to the smaller size of the domestic market, users from different countries cannot participate in the biggest lotteries in the world. They are restricted to smaller local lotteries. Popular American lotteries like Mega Millions and Powerball do not sell tickets outside the United States. New online solutions may come with high fees and fraud risks.
• Small Jackpot: Currently, the state and law regulations control the way lotteries are carried out in different corners of the world. On average, not more than 55% of the funds collected from ticket sales are allocated to the prize pool.
• Distribution of prize funds: Lotteries are often used as funding sources for charities and social projects. However, in many cases where countries suffer from high levels of corruption, players can question the fair distribution of funds.

Challenges faced by traditional lottery games

Blockchain is currently the only technology that can solve all of these issues by creating a transparent and fair platform for conducting online lotteries worldwide. Cardano is considered a third-generation blockchain with superior features in security, scalability, and sustainability. By leveraging Cardano's smart contract capabilities and EUTxO ledger to build the lottery game, this project will bring the following advantages:

• Increased transparency: Blockchain provides a transparent and secure platform for processing lottery transactions. All transactions are recorded on the blockchain ledger, and the total revenue from ticket sales is available for everyone.
• Enhanced accessibility: Players who own ADA can participate in the Cardano Millions Lottery from anywhere and at any time. Cardano Millions aims to connect players from all parts of the world.
• Larger prizes: By building Cardano Millions in a decentralized and online ticket sales model, we can reduce operational costs, resulting in up to 80% of ticket sales revenue allocated to prizes (much higher than the traditional lottery games, which typically allocate only 50-60%). We keep only 20% of ticket sales revenue to cover business operations, infrastructure, marketing, and maintaining a minimum jackpot prize fund for each drawing.
• Safety and security: Utilizing blockchain technology, smart contracts, and the EUTxO ledger ensures that the appropriate funds are transferred to the right recipients at the right time with full security.
• Convenience and fast: Players can quickly and easily purchase tickets online from anywhere with an internet connection. Prizes can be claimed through Dapp, eliminating the need for players to visit physical lottery offices to claim their rewards, as required by traditional lottery games. In addition, the prize will be fully sent to the winners within a couple of seconds, instead of a few weeks like in centralized lottery games.
• Privacy: Since players can buy tickets and receive prizes with cryptocurrencies, their identities remain anonymous. The transactions are stored on a public blockchain, allowing for traceability and easier resolution of disputes or controversies related to the lottery.

The benefits of the blockchain-based lottery games

The Cardano Millions lottery game will be developed as a Dapp on the web platform. Players will connect their wallets to the Dapp to participate in ticket purchases. The gameplay of Cardano Millions is similar to other popular lottery games and includes the following steps:

1. Number selection: Each ticket will include 5 white numbers and 1 red number. Players will choose 5 white numbers ranging from 1 to 69 and 1 yellow number ranging from 1 to 26. Additionally, players can choose the "Quick Pick" option to generate random numbers for them. Players can purchase multiple tickets at once.
2. Drawing selection: Players can choose to participate in the next drawing. At this point, you can also decide if they want to play for two, three, or four weeks in advance.
3. Payment: Connect your wallet to the Dapp and pay for the tickets using ADA.
4. Drawing: The game will organize a drawing to determine the winners.
5. Prize claim: The winner will connect their wallets with the Dapp to claim the prize.

To demonstrate the impact of the project, we will track and publish the following information for each drawing: the number of tickets sold, total ticket sales revenue, total number of participants, total number of winners, prize amounts for each tier, list of winners, and the value of the jackpot prize (also known as total value lock of the DApp). Additionally, player feedback and social media engagement are crucial for validating the effectiveness of our solution.

[IMPACT] How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?

Our proposed solution directly addresses the challenges of generating innovation and creativity to unlock the potential of the Cardano ecosystem, while also helping individuals to interact with and benefit from Cardano.

Firstly, Cardano Millions will significantly increase the number of transactions and users on the Cardano blockchain. Lotteries are among the most popular games worldwide. According to reports of Facts and Factors, the global lottery market was valued USD 366.55 billion in 2021, and it is expected to increase to USD 405.20 billion by 2028, representing a compound annual growth rate (CAGR) of almost 3.10% during the projected period. In Europe, EuroMillions alone sells approximately 600 million tickets per month.

Although blockchain technology is still relatively new to the public, with the advantages that Cardano Millions brings in terms of prize value and transparency, we hope Cardano Millions will be welcomed by everyone, becoming a popular lottery game and one of the pioneering driving forces contributing to the growth of the Cardano ecosystem.

Secondly, our solution will contribute to increasing the total value lock of the Cardano ecosystem. For Cardano Millions, the value of the jackpot is the total value lock of the game. The jackpot accumulates over time and remains locked until a jackpot winner is found.

Thirdly, in addition to benefiting the Cardano ecosystem, our solution brings significant advantages to lottery players worldwide. With the same ticket sales revenue as traditional lottery games, the prize amount received by winners will be more than 140% higher. Furthermore, because transactions are recorded on the blockchain, players can trace the history to verify who won the jackpot and whether the winnings were paid as defined in the smart contract. This enhances the user experience and trust in the lottery game.

Lastly, the global lottery market has millions of players. When our solution is embraced by players, it will promote and expand the presence of Cardano. Players will become aware of Cardano every time they learn about purchasing tickets on Cardano Millions.

In summary, our proposed solution addresses the challenges of increasing the number of products available for the community to use, increasing transactions and new users, and driving innovation in the Cardano ecosystem. In the next two years, we hope that Cardano Millions will achieve the following goals:

• Reach 50,000 players and sell 1 million tickets per month
• Attain a total value lock (jackpot) of 10 million ADA
• Add 10,000 players from the lottery market to the Cardano ecosystem, driving more adoption
• Earn trust and satisfaction from players
• Contribute as a utility to increase the value of the Cardano ecosystem and the global lottery community.

With the advantages of blockchain technology and Cardano's security, scalability, and low transaction fees, we believe Cardano Millions will be a better alternative to current centralized lottery providers.

[IMPACT] How do you intend to measure the success of your project?

To measure the success of the Cardano Millions project, we will use a combination of quantitative and qualitative metrics to assess its impact on the Cardano ecosystem.

• Adoption & Usage: Measure the number of on-chain transactions by counting the number of ticket purchase transactions. Measure the number of players by counting the number of stake addresses.
• Total Locked ADA: Measure the maximum amount of ADA locked for the jackpot prize.
• Social Media Popularity: Measure the number of likes, views, and followers of Cardano Millions on Twitter.
• Player Satisfaction: Gather player feedback to assess their level of satisfaction and trust through surveys.
• SPO Rewards: Measure the total amount of transaction fees earned by pool operators through ticket purchase transactions.

In the short term, our innovation will add a new use case to Cardano's collection of utilities by transforming centralized service products into decentralized ones. In the long term, as the ADA amount in the jackpot increases and reaches 1 million, Cardano Millions will create an explosion of participants and transactions in each drawing. These advantages contribute to the productivity and growth of Cardano.

By tracking and evaluating these metrics, we can gauge the success and impact of Cardano Millions on the Cardano ecosystem.

[IMPACT] Please describe your plans to share the outputs and results of your project?

We are committed to sharing the outputs and results of our project in a public, comprehensive, and transparent manner through the following channels:

• GitHub: The entire source code of Cardano Millions, once completed, will be made public and stored on GitHub for the community to verify at any time.
• Communication Channels: Monthly, we will share updates and project outputs through various communication channels, including our website, social media platforms (Twitter and Reddit), and Discord.
• Challenge Team: We will report the completion of milestones through reports sent to the challenge team and publicly shared on our communication channels.

[CAPABILITY/ FEASIBILITY] What is your capability to deliver your project with high levels of trust and accountability?

I am a software engineer with 5 years of experience in deploying commercial products and also serve as the technical lead of an e-commerce company. I have 3 years of experience in designing cloud infrastructure on AWS and 4 years of experience in backend web development. I have participated in Haskell and Plutus Pioneer v3 and v4 courses at IOG Academy and obtained the Cardano Blockchain Certified Associate certification from the Cardano Foundation. Additionally, I am a Proposal Advisor for Catalyst Fund 9.

Our main smart contract developer - Mazen Khaddaj - also has the Cardano Developer Professional certification issued by Emurgo Academy. We have developed an experimental project to have a proof of concept for our solution. This is the GitHub link to our project.

Furthermore, to demonstrate my ability to manage funds responsibly, we will provide monthly reports in the form of Excel files detailing the expenditure of funds and the results achieved during that month, allowing the community to track and assess our effectiveness.

With all the skills and project management experience we have, I believe we can successfully deliver this project on time.

Mazen's Cardano Developer Professional Certification (online certification)

Cardano Blockchain Associate course completion certificate

[CAPABILITY/ FEASIBILITY] What are the main goals for the project and how will you validate if your approach is feasible?

Our project has the following main goals:

1. Develop and launch a Cardano-based lottery: Our primary goal is to build and deploy Cardano Millions, a lottery game similar to Powerball, where people can participate in ticket purchases without any age, geographical, or nationality restrictions.
2. Ensure the safety and security of the prize: The safety of the prize fund is one of our top priorities. The prize is only awarded to the winner and no one else, including the game organizers.
3. Decentralize traditional lottery games: We aim to revolutionize traditional lottery games by applying blockchain and smart contracts, providing a superior and more reliable lottery experience, and serving as a better alternative to traditional lotteries.
4. Ensure fairness: Winning numbers must be randomly selected and guarantee fairness for all players.
5. Ensure transparency and reliability: Information regarding the number of tickets sold, ticket sales revenue, player lists, winning results, and prize distribution transactions for each draw must be publicly transparent and independently verifiable without relying on the game organizers.
6. Ensure scalability: Lotteries have a large number of participants worldwide. Ensuring smooth operation under high transaction volumes without delays is one of the project's objectives.

To validate the feasibility of our approach, we will implement several strategies:

• Build a transaction flow diagram to test the feasibility of the project when applied to the EUTxO ledger model and smart contracts.
• Refer to how existing DEXs like MinSwap and SundaeSwap have designed their systems to address scalability issues.
• Develop a proof of concept consisting of smart contracts and conduct rigorous testing to ensure the feasibility of Cardano Millions' core features. (Please check our experimental project on GitHub here)
• Conduct research on the lottery market and current traditional lottery games to understand their strengths and weaknesses.

[CAPABILITY/ FEASIBILITY] Please provide a detailed breakdown of your project’s milestones and each of the main tasks or activities to reach the milestone plus the expected timeline for the delivery.

Our project will have the following milestones:

Milestone 1: Develop Smart Contracts

• Main tasks:
• Analyze, design, develop, test, and deploy all the necessary smart contracts.
• Timeline: 6 weeks.
• Success or Acceptance Criteria:
• All the necessary smart contracts are fully developed and thoroughly tested on the Cardano testnet.
• Open source all smart contracts.
• Able to use cardano-cli to build transactions for conducting integration tests between smart contracts.
• Projected Cost: $9,600 (₳ 33,680)

Milestone 2: Design Cloud Infrastructure and Develop DApp Backend

• Main tasks:
• Design a cloud infrastructure ensuring high availability, security, and scalability.
• Analyze and design the database structure.
• Build APIs for reading and writing data into the database.
• Timeline: 6 weeks.
• Success or Acceptance Criteria:
• Set up the entire system infrastructure on AWS cloud.
• Complete the necessary APIs for the features of Cardano Millions.
• Projected Cost: $16,600 (₳ 58,250)
• This projected cost also includes the cost of AWS infrastructure in 9 months.

Milestone 3: Design and Develop DApp Frontend

• Main tasks:
• Design a user-friendly website interface.
• Build an interface compatible with various devices.
• Connect to wallets and allow users to purchase tickets using ADA.
• Timeline: 8 weeks.
• Success or Acceptance Criteria:
• Have a design sketch of the Cardano Millions website interface.
• Design responsive to deployment on various devices.
• Design and develop the Cardano Millions website in a user-friendly manner.
• Able to connect with the main wallets of the Cardano ecosystem and build transactions for purchasing tickets.
• Projected Cost: $13,800 (₳ 48,420)

Milestone 4: Testing, Auditing, and Fixing Bugs/Issues

• Main tasks:
• Write test cases to test user interactions with the game.
• Develop programs to automate the testing of these test cases.
• Perform security auditing and vulnerability assessment for smart contracts.
• Fix any errors or issues encountered during the testing process.
• Timeline: 4 weeks.
• Success or Acceptance Criteria:
• Complete a document of test cases that covers all the cases where the user can interact with the game.
• Complete the security auditing and vulnerability assessment of smart contracts.
• Security audits and vulnerability assessments completed
• Thoroughly test and ensure that all features on the interface work as expected.
• Projected Cost: $8,400 (₳ 29,470)
• This projected cost also includes the auditing fee of an independent third-party auditor.

Milestone 5: Launching and Deployment

• Main tasks:
• Execute marketing campaigns to attract players' attention.
• Deploy the DApp on the Cardano mainnet.
• Initialize the prize pool.
• Launch the game.
• Timeline: 4 weeks.
• Success or Acceptance Criteria:
• Successful deployment of Cardano Millions on the Cardano mainnet.
• Marketing campaigns launched on Twitter, Reddit, and Telegram.
• The game has an initial prize pool of $3,000.
• The game is launched.
• Attract 200 people to participate in the game
• Projected Cost: $8,600 (₳ 30,180)

[CAPABILITY/ FEASIBILITY] Please describe the deliverables, outputs and intended outcomes of each milestone.

Milestone 1: Develop Smart Contracts

• Deliverables:
• Source code of all smart contracts.
• Documentation for each smart contract.
• Intended outcomes:
• All smart contracts are functioning as designed.
• When combined, the smart contracts adhere to the following rules:
• The winning number sequence is unpredictable, even for the game organizers.
• The prize fund can only be spent on awarding prizes to winners. The conditions for prize withdrawals are specified in the smart contract, preventing any unauthorized access to the prize fund, including by the game organizers.
• The jackpot prize will be accumulated until someone wins that prize.

Milestone 2: Design Cloud Infrastructure and Develop DApp Backend

• Deliverables:
• Diagram of the system's cloud infrastructure design.
• List of APIs and accompanying documentation.
• Intended outcomes:
• The backend system is built on AWS, meeting high standards for scalability, readiness, and security.
• The APIs can function within an acceptable delay (typically under 2 seconds).

Milestone 3: Design and Develop DApp Frontend

• Deliverables:
• Interface design on Figma.
• A website with a user-friendly interface, including the following features:
• Integration of the DApp with players' wallets.
• Ticket purchasing functionality.
• Viewing purchased tickets.
• Retrieving information about the current drawing.
• Retrieving information about past drawings.
• Displaying the current jackpot prize.
• Website compatibility with various devices.
• Intended outcomes:
• A user-friendly website capable of handling high concurrent traffic.
• The website provides comprehensive information about Cardano, gameplay instructions, and relevant details.
• Any player can connect their wallet to the DApp to participate in ticket purchases.

Milestone 4: Testing, Auditing, and Fixing Bugs/Issues

• Deliverables:
• A document of test cases.
• Security audits and vulnerability assessments report.
• Information about discovered bugs and their resolutions.
• A document of test results.
• Intended outcomes:
• A reliable game with no errors.
• Thorough testing of all player interactions on the website.

Milestone 5: Launching and Deployment

• Deliverables:
• Game launch on the Cardano mainnet with a domain for player access.
• Marketing materials and results of marketing campaigns.
• Address of the initial prize fund UTxO (Unspent Transaction Output).
• Intended outcomes:
• The game operates successfully on the Cardano mainnet.
• Attracting players within and outside the Cardano community through marketing campaigns.

[RESOURCES & VALUE FOR MONEY] Please provide a detailed budget breakdown of the proposed work and resources.

Milestone 1: Develop Smart Contracts (6 weeks)

• Development and testing for 4 smart contracts: $9,000
• Project management: $600

Total: $9,600 = ₳ 33,680 = 16.84% of budget

Milestone 2: Design Cloud Infrastructure and Develop DApp Backend (6 weeks)

• Designing Cloud Infrastructure & Cardano Node: $4,500
• Backend Development & Database setup: $9,000
• AWS services (EC2, Lambda, S3, DynamoDB, CloudFront, Route 53) for 9 months: $2,500
• Project management: $600

Total: $16,600 = ₳ 58,250 = 29,13% of budget

Milestone 3: Design and Develop DApp Frontend (8 weeks)

• Designing user interface: $800
• Frontend and Off-chain Code Development: $12,000
• Project management: $1,000

Total: $13,800 = ₳ 48,420 = 24.21% of budget

Milestone 4: Testing, Auditing, and Fixing Bugs/Issues (4 weeks)

• Writing Testcases, Developing Automation Testing Programs, and performing tests: $3,000
• Independent security audit and vulnerability assessment: $5,000
• Project management: $400

Total: $8,400 = ₳ 29,470 = 14.74% of budget

Milestone 5: Launching and Deployment (4 weeks)

• Marketing campaigns and Marketing materials: $3,700
• Initial Prize Pool: $3,000
• Community engagement, Documentation & Reporting: $1,500
• Project management: $400

Total: $8,600 = ₳ 30,180 = 15.09% of budget

If the project costs exceed the funding request (in case the price of ADA decreases compared to the expected price), we will seek additional loans from financial institutions or seek additional sponsorships to ensure the project can be completed on time. When the project generates profits, we will repay the borrowed amount.

If the project costs are lower than the funding request (in case the price of ADA increases compared to the expected price), we will use all the remaining funds to contribute to the prize pool, directly benefiting the players.

For a detailed budget and timeline, please refer to the 2 sheets of this Google file

Detailed budget breakdown (Google spreadsheet file)

[RESOURCES & VALUE FOR MONEY] How does the cost of the project represent value for money for the Cardano ecosystem?

The cost of the project represents value for money for the Cardano ecosystem in the following ways:

• Adding a use case for transitioning traditional services to decentralized services.
• Increasing the expansion and adoption of Cardano: Building a lottery game on the Cardano blockchain platform will help introduce Cardano to a wider audience, especially the community of lottery game enthusiasts.
• Providing a fully functional lottery game with larger and more transparent prizes for players worldwide. With the same ticket sales revenue, our lottery game will have prizes over 140% higher than other centralized lottery games. The launch of Cardano Millions is expected to be a better alternative to other traditional products in the market with millions of players.

The budget of 200,000 ADA ($57,000) for our Cardano Millions project is based on the standard hourly rates ($50/hour for senior-level and $30/hour for middle-level) that align with industry standards for software developers, architects, and testers in the software development field in general, and the specific nature of the blockchain industry. We also refer to the standard salary levels from a survey conducted by Stack Overflow in 2023, which included responses from 90,000 programmers. (Reference link: https://survey.stackoverflow.co/2023/)

[IMPORTANT NOTE] The Applicant agreed to Fund10 rules and also that data in the Submission Form and other data provided by the project team during the course of the project will be publicly available.

I Accept