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Rivalry CEO and co-founder Steven Salz believes cryptocurrency-based utility tokens can revolutionise customer and brand loyalty in the gambling industry.

Rivalry made waves this week by venturing into the crypto gambling arena with the launch of the Rivalry Token.

During the operator’s Q1 2024 earnings call yesterday (30 May), co-founder and CEO Steven Salz explained what drove this strategic move.

He revealed that the idea dates back to Rivalry’s inception in 2017.

At the time, he said, he already pondered how to provide users with a “non-zero-sum game experience in gambling.”

“No matter the outcome, whether you win or lose, there should be some value proposition for users,” he said.

“That’s one of the unique challenges of operating gambling as a consumer product. Our revenue is directly tied to what our consumers lose; it’s the nature of the business.

“However, it’s an atypical relationship. If you think about other consumer products, you’re not in competition with your own customers.”

A new approach to customer loyalty

Salz emphasised that building brand and customer loyalty has always been pivotal to Rivalry’s operations

As a long-time critic of bonus promotions and free bets, Salz questioned: “How do you retain a user? How do you prevent gamblers from having multiple betting apps on the same phone? How do you make them super fans of your brand?

“Our focus has always been on creating a community, but we’ve also been looking for a technical solution or a product solution to be able to amplify that,” he said.

Salz observed the evolution of tokens closely and recognised significant shifts.

The first cycle of tokens in crypto in 2017 was uncharted territory with no legal framework, he pointed out.

“It felt too risky for us at the time. However, subsequent cycles have seen advancements in technology, proven use cases, and the development of a legal framework, which is crucial for us as a publicly listed company,” he said.

At the end of last year, when the company was brainstorming ideas to provide reasons for users to engage with the platform “whether they are betting or not”, it became clear that developing an ecosystem or marketplace system was necessary.

This prompted the reconsideration of entering the crypto gambling segment and launching a token.

Is another crypto growth cycle on the horizon?

Salz highlighted industry estimates indicating that crypto wagers now make up 25% of global betting handle and projected that this market share will continue to grow as older demographics phase out.

“This isn’t a flash in the pan either. It’s where the future of online gambling is headed,” he said.

Salz isn’t alone in this belief. Yolo Investments general partner Tim Heath recently predicted that within five years, every casino, including land-based establishments, will accept cryptocurrency as a payment method.

Salz emphasised that the primary demographic driving crypto growth is under 30, comprising internet-native users and Rivalry’s core customers.

The introduction of the token serves as a “compelling hook”, Salz said, indicating to users that Rivalry is not only expanding its accepted cryptocurrencies but integrating a utility token into its ecosystem.

This integration aligns Rivalry more closely with the web 3 community, “while also allowing us to re-engage all of our historical users,” he concluded.

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