THE FIRST TRANSPARENT LOTTERY ON BLOCKCHAIN

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1 THE FIRST TRANSPARENT LOTTERY ON BLOCKCHAIN

2 Introduction Over 100 million people play Lottery every day in the world. On average about 1 in 14 people win. Pretty impressive, no? The reason we bring up Lottery is that LuckyToken is a tokenized "Lottery" in the sense that the rules of the game are absolutely the same: the player chooses 5 arbitrary natural numbers ranging from 1 to 75, and also one additional number ranging from 1 to 15. Having guessed correctly the five numbers, the player receives the first prize, and if he also guessed the extra number, he/she wins the jackpot. The smaller number of matches also has its own prize categories. However, the main difference between regular Lotteries and LuckyToken is that LuckyToken is blockchain-based and therefore not subject to manipulation. The online lottery market today is extremely promising due to sheer number of participants and the entertainment factor. But despite overwhelming popularity, the lotteries currently available are not equipped to ensure the transparency of prize funds accumulation and distribution. But because of innovative technologies such as blockchain and smart contracts, we now can handle these critical issues. LuckyToken is a decentralized lottery, the main advantage of which is the absolute transparency of all processes taking place on the platform and the complete and utter impossibility of fraud.

3 Introduction The use of blockchain technology gives LuckyToken a number of advantages over classic lotteries: 1. Transparency. The lottery mechanism and prize payments are clearly displayed on theethereum blockchain and are available for viewing to everyone. 2. Anonymity. Despite the fact that the blockchain is an open database, it only shows thenumbers of electronic wallets. Personal data is not required. 3. Distribution of funds. Transparent mechanism of the blockchain lottery LuckyTokensuggests the possibility of tracking the funds received from ticket sales: 50-60% of one LUCis a prize fund *. 4. Availability. To participate in the game and receive a prize, a player must only register onthe website and have an Ethereum wallet. All transactions are displayed in the open registry (blockchain) therefore any player can make sure that all prizes are awarded in full concordance with lottery rules, instantly, without any third party involvement. All payments are clearly displayed. The platform doesn t require any state issued IDs, licenses, or registration for playing, your digital wallet is enough to participate. *It's impossible to calculate, what percentage of the cost of the classic lottery tickets goes into prize funds,given that according to the data of the North American Association of State and Provincial Lotteries, last yearamericans spent on lottery tickets $70.15 billion, and the maximum jackpot in the history of MegaMillionswas $656 million, which is about 1% of the total amount of lottery spending.

4 Rules of the game The rules of the game LuckyToken are simple. The first thing you need to do is to get an Ethereum e- wallet and register on the LuckyToken platform. To register, you will need a name and address. After that, you may purchase the desired amount of LUC for Ether. The cost of 1 LUC is equivalent to $1.00, which is the price of a single play. 1 LUC is not just a lottery ticket, it is a full token, which can be exchanged for another currency or used to pay for goods and services. Question: how many bets should you make? The increase in the mathematical probability of winning one of the prizes in the Mega-game and the mathematical expectation of profit with a conditional average jackpot of $ 5,000,000 is shown in the graph below.

5 Rules of the game Once the tokens are purchased, a player uses his personal cabinet on the platform to choose an available game - there are three games available any given week, held on Wednesdays, Fridays, and Sundays: Mini-LuckyToken - every Wednesday at 10:00 AM GMT; a player is required to correctly guess 5 basic numbers out of 49, and 1 extra number out of 15. In this game the biggest prizes are awarded for a small number of correctly guessed lots: having guessed only one additional lot and spent only $1.00 per ticket, a player receives $ the odds of such a win is 1 to 15. Having guessed at least one additional lot of the main five lots, the player will be awarded $12.00, two additional lots - $30.00! Note that the first prizes in the mini-game are relatively small, and the jackpot cannot be more than the equivalent of $1 million. Big-LuckyToken - held every Friday at 10:00 AM local time; the player is required to correctly guess 5 basic numbers out of 59, and 1 additional out of 15. This game is the "golden middle" of the LuckyToken. The odds of correctly guessing the numbers are higher than in Mega; the jackpot and the first two prizes are three times higher than the similar prizes in the Mini. The minimum second prize is about $3,000, the first prize is at least $15,000, and the jackpot can reach $3 million.

6 Rules of the game Mega-LuckyToken - the main game of the week, the "MaxiMilion" of the LuckyToken, is held on Sundays at 10:00 AM local time. Players are required to guess 5 basic numbers out of 75 and 1 additional number out of 15. The "small" prizes are completely equivalent to the original MaxiMillion, and the first two prizes and the jackpot do not have any prescribed restrictions and depend only on the size of the prize pool. The minimum jackpot is the equivalent of about $300,000, and the maximum jackpot can be in excess of $ 10 million. After selecting the game and making a bet, the player agrees to the terms of the smart contract, which lists the date of the game, the chosen combination of numbers, the price for playing (1 LUC), the amount of the potential winnings, and the terms of the game. In the case of a win, the system automatically transfers the winnings based on the smart contract, having previously made a request to choose the currency denominating the prize: LuckyToken or Ethereum.

7 The mechanics of the game Winning combination A winning combination is formed for each game by the random number method on the basis of a cryptographically stable hash function, calculated by adding a block of the next six numbers (5 + 1) to the blockchain. The last two digits of the hash function are analyzed: if they are in the specified range (1-49 for basic numbers mini, 1-59 for basic numbers big, 1-75 for basic numbers maxi, 1-15 for additional number), then they are written in the combination. If the last two digits exceed the specified range, then the difference for 100 is written for the base numbers (if the difference is 0, then - 49), and for the additional number - the whole part of the quotient of 7. Prize fund The prize fund has three sources of funds: Pre-sale sale of tokens - forms the initial prize fund, ensuring the payment of prizes in the first games; sale of the LUK tokens reserve - with increasing demand for LUC tokens for participation in the lottery, the reserve tokens will be subject to sale ensuring the growth of both the prize pool and the jackpot.

8 Distribution of revenue from the sale of tokens 22% The prize fund 50% Marketing 28% Management fee and token development

9 Distribution of the prize fund 1. Fixed prizes: prizes from the eighth to the third for each lottery - mini, big, maxi - arefixed. Also fixed are the minimum prize amounts for the first and second prizes and thejackpot. Provision of the fixed prizes is a priority in the distribution of the prize pool. Mini Big Mega 0+1 $3 $2 $1 1+1 $12 $4 $2 2+1 $30 $10 $5 3+0 $30 $10 $5 3+1 $300 $100 $ $3,000 $1,000 $ * >$1,000 >$3,000 >$6, * >$5,000 >$15,000 >$30, * >$50,000 >$150,000 >$300,000

10 Distribution of the prize fund 2. Replenishing of the game s reserve prize fund, which follows the one in which the jackpotis won. Starting with that game, the 90% of the revenue from the sale of LUC received as apayment for the previous game will be used to fill the reserve prize fund to the requiredminimum of $1,000,000 (in ETH equivalent) until that goal is reached. 3. Prize funds for lotteries with fixed interest rate prizes: first and second prizes, as well as ajackpot. The fixed interest rate prize fund is divided between lotteries in the followingproportion: Mini: 10%, but not more than $1,105,000 (in ETH equivalent); Big: 30%, but not more than $3,315,000 (in ETH equivalent); Maxi: from 60%; 4. The division within the prize pools of each lottery into the second prize (2%), the first prize(10%) and the jackpot (88%).

11 Distribution of the prize fund 5. The maximum jackpot. The size of the maximum possible first prize and jackpot iscalculated based on: (1) the size of the prizes with a fixed interest rate for lotteries "mini"and "big"; (2) the maximum emission of LUC tokens (100 million); (3) the mathematicalforecast of the winnings of fixed prizes. If the jackpot is won, then the next game starts witha minimum jackpot. If in the current draw the jackpot is not won, the jackpot funds allocated towards the nextjackpot. Thus, the Jackpot is growing constantly until the time of the play. Once the jackpotis won, the smart contract accesses the reserve fund and withdraws the amount for theminimum guaranteed jackpot. The platform hosts a draw archive with the complete historyand jackpot amount for each raffle Mini Big Mega 4+1 <5,000$ <100,000$ <1,000,000$ 5+0 <15,000$ <300,000$ <3,000,000$ 5+1 <250,000$ <1,250,000$ <10,000,000$

12 The safety and security of the prize fund are ensured by 1. The prize fund is stored in a smart contract with multi-signatures. Such a system protects theprize pool from hackers. The right of signatures is temporarily owned by the team of projectcreators. The development team is working on ensuring that the verified nodes of the network takeover the signature function. 2. The first prizes payouts are made through an additional smart contract, into which the winningsare automatically transferred after the lottery. Under this contract, the compliance with the rules ofthe game is repeatedly checked in order to avoid accidental, staged, or other improper receipt offunds. 3. All operations with the prize fund are saved on the blockchain and can be tracked at any time byany user. Payments are made on the basis of smart contracts, concluded by users at the time ofbet confirmation. 4. The prize fund is stored in the cryptocurrency Ether and is not immune to its volatility. Therefore,the team of creators reserves the right to change the cryptocurrency of the prize fund in order toensure maximum safety of its actual value.

13 ICO (Initial Coin Offering)

14 Initial Coin Offering The pre-sale of the tokens will take place from March 05, 2018, until the sale of the entire available amount of tokens, but will end no later than May 05, The purpose of the Initial Coin Offer (ICO) is to raise the capital needed for the jackpot and promotion of the LuckyToken lottery. Also, we strive to move LuckyToken to a fully decentralised platform by implementing a 100% transparent system making it independent of any third party (including the team of developers). NOTE: our goal is to make LuckyToken a truly independent, decentralized, and international lottery. For that reason, once the ICO stage of the project had gone through and the platform is launched, we will add multiple payment methods utilizing various cryptocurrencies, national, and international payment services. The amount of tokens available for pre-sale is 10,000,000 LUC.

15 Initial Coin Offering As part of the promotional strategy at the ICO stage, all 10,000,000 of LuckyTokens (LUC) will be sold at a discounted rate: Sum, LUC Rate Discount 1,000,000 1LUC=$ % 1,500,000 1LUC=$ % 2,000,000 1LUC=$ % 2,500,000 1LUC=$ % 3,000,000 1LUC=$0.75 0%

16 Initial Coin Offering Money collected during fundraising will be distributed in the following proportion: 60% for the the lottery jackpot and the prize fund; 20% marketing budget (including 10% for bountyprogram) 20% management fee and token development; The initial amount of tokens will be distributed among members of the developer team as a reward for creation of the LuckyToken Platform. In the future these tokens can be divided among other partners interested in further development of the project.

17 Marketing strategy Referral program. Let your friends know about the LuckyToken lottery platform, invite them and other players using your personal referral link and receive a reward. Your referrals get a free ticket to start playing, and their referrals, in turn, receive 1% of their invitees winnings on a permanent basis, and so on. This command is embedded in the program code and is executed automatically. Also, if invitees buy LUC tokens during ICO, another 7% of the amount purchased will be added to their accounts. Affiliate program. We ve created a partnership network, an online platform helping advertisers and businesses to connect and interact, and for identifying the most effective media to run promotional campaigns. It s an excellent media tool for selecting the right advertising offers online. It s impossible to ignore the increasing number of Internet users around the world and the influence that blogs and specialty websites have on them. Just contact our support team and discover the ease and joy of working with LuckyToken.

18 Privacy LuckyToken Platform team of software developers, managers, and legal specialists is aware of the importance of privacy and maintaining confidentiality of personal data, which is clearly expressed in our Privacy Policy. We have taken steps to ensure that data collection on our part does not exceed the quantities necessary for services provision and protecting your account. We use repository contract to store user data. Every user is defined by their alias and wallet ID, which means that the stored data are anonymous and don t require any personal information or additional documents.

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