I'm just having a look now. The first thing that grabs me about their website is "The Problem" section. It states:
"Traditional lottery is broken: High fees, low transparency, rampant fraud, major social stigmas against players, and no support system for players who win, steal the dreams of people playing a game in the hopes of living a better life."
I didn't believe any of this. Traditionally lottery is run by a country's government. For the National Lottery in the UK 53% goes to winnings, and a further 25% go to good causes. This sort of assumes that the 12% going to the government does not flow on to good causes even though it goes reduce the potential tax burden through other avenues. Other countries would probably have similar returns.
As for "low transparency and rampant fraud" this is simply not true. Government and state run lotteries are publicly audited and heavily scrutinised. And the stigma associated with the lottery is a lot lower than nearly all other forms of gambling. So they didn't start off with a very honest market assessment there.
Then they chose not to put in what percentage of bet value is taken by the house, and what is distributed as prizes on their website. This is a huge red flag. This alone makes me recommend keeping clear of the ICO. Odds of winning are meaningless. The only number that matters is the percentage they take out. For example, if you bet $1 and had a 1:8 chance of winning $10, the house is taking 20% of the wins. They are great odds of winning, but not much of a prize. Add some zeros to the odds and the the same number of zeros to the prize and you get a better payout, but the house still takes the same percentage.
The next red flag is the fact that they don't say what percentage is given to charities, or name the charities. To me that looks either lazy or like lies. Either way it is a very bad sign. The whitepaper later states 10%.
Their whitepaper whitepaper puts the current lottery market at $300 billion. Then makes the outlandish claim that their potential market is $600 billion. When you consider how easy it is to buy a lottery ticket, compared to how confused the general public are about dealing in cryptocurrency, this figure is absurd.
Then the whitepaper fails to shed further light on any of these issues as well as glossing over things like their code and their team. It is not clear if their code on github will run on the blockchain or if a lot of the calculations will be done off chain. But worse than all this is their claim that:
We have completely rethought how a lottery game can function. We have no
direct competitors in the space. "
From everything I can see, there has been no re-thinking the basic concept of lottery at all. They're just running it using different code, and un-stated portion of which might run on the blockchain. And as for no competition, the blockchain industry is full to bursting with online gambling projects. To not mention these is a major failure or dishonest.
Okay, I found the prize percentage:
After a player buys a ticket, the funds will be distributed as follows:
● 60% goes directly into the prize money
● 10% go into marketing
● 10% into global social causes
● 7.5% for fees & operations
● 10% for the token holder game
● 2.5% for referral awards
So they provide 70% back to the winners and good causes. UK lottery provides 78% back to winners and good causes. So this looks like a bad deal even for the gamblers. Again, run away.
Lastly, they intend to raise about US$24 million. Then spend US$11 million on the development team for something picks a random ticket holder and pays out to their account. I would not be investing in a company that throws money around like that.