The Onchain Gambler: Price Sensitivity and Jackpot Seeking in Blockchain Lotteries

Session Title

AI & Technology: Industry Frameworks

Presentation Type

Paper Presentation

Start Date

26-5-2026 12:00 AM

Abstract

Blockchain technology facilitates novel forms of online interaction and commerce, including unregulated gambling markets. Understanding user behavior within these environments is crucial, yet empirical research is limited. This study investigates consumer behavior in a large-scale, blockchain-based lottery, examining whether established psychological drivers of lottery participation persist in this technologically distinct context. Leveraging granular, publicly available wallet-level transaction data over 18 months, we analyze the influence of jackpot size, participation cost, and recent jackpot winners on ticket purchasing. An instrumental variable approach is used to address potential endogeneity, and is complemented by qualitative analysis of user discussions. Results across models indicate that behavior mirrors traditional lottery findings and hypothesized relationships: participation increases significantly with prize pools and decreases with higher costs of entry (including nominal ticket price and blockchain transaction fees). These findings suggest that core psychological mechanisms driving gambling behavior, such as attraction to large payoffs and multiple motivations, may be transferable to blockchain environments. The study highlights the utility of blockchain data for granular behavioral analysis and underscores the need to consider human behavior and potential risks when designing and regulating computer-mediated gambling applications in decentralized platforms.

Author Bios

Kahlil Simeon-Rose is a faculty member in School of Hospitality Business Management at Washington State University. His research focuses on public policy and consumer behavior in gambling

Share

COinS
 
May 26th, 12:00 AM

The Onchain Gambler: Price Sensitivity and Jackpot Seeking in Blockchain Lotteries

Blockchain technology facilitates novel forms of online interaction and commerce, including unregulated gambling markets. Understanding user behavior within these environments is crucial, yet empirical research is limited. This study investigates consumer behavior in a large-scale, blockchain-based lottery, examining whether established psychological drivers of lottery participation persist in this technologically distinct context. Leveraging granular, publicly available wallet-level transaction data over 18 months, we analyze the influence of jackpot size, participation cost, and recent jackpot winners on ticket purchasing. An instrumental variable approach is used to address potential endogeneity, and is complemented by qualitative analysis of user discussions. Results across models indicate that behavior mirrors traditional lottery findings and hypothesized relationships: participation increases significantly with prize pools and decreases with higher costs of entry (including nominal ticket price and blockchain transaction fees). These findings suggest that core psychological mechanisms driving gambling behavior, such as attraction to large payoffs and multiple motivations, may be transferable to blockchain environments. The study highlights the utility of blockchain data for granular behavioral analysis and underscores the need to consider human behavior and potential risks when designing and regulating computer-mediated gambling applications in decentralized platforms.