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Cracking the Code: Zed Run

We have earned over $115,000 on Zed by successfully determining the strength and intrinsic value of assets through complex statistical and valuation models. Our discovery system identifies exceptionally strong horses based on small sample sizes, which we then purchase and sell to professional stables.

What is Zed

Zed Run is a digital horse racing game built on the Ethereum blockchain that allows players to own, race, and earn real money with non-fungible token (NFT) horses. The value of these NFT horses is determined by their bloodline and racing ability, which can be analyzed through their performance on the track.

How are Races Determined

In each race, there are 12 competing horses and the outcome is determined by their Speed (Mean) and Randomness (Standard Deviation) traits. These traits are crucial to understanding the market value of horses, some of which have earnings of over $60,000. However, these traits are not revealed to players, making it difficult to accurately assess a horse's racing ability based on a small sample size.
Screen Shot 2022-07-12 at 1.46.58 PM.png
[Speed and Randomness of two horses]

How we Evaluate Horses

To address this challenge, we have implemented a custom ELO rating system in Python to calculate the relative skill levels of the 286,000 horses in the game based on their past performance data. The ELO rating system is a method for calculating the relative skill levels of players in zero-sum games and was originally invented as an improved chess-rating system. It has since been used in various sports and esports. By coding our custom ELO model into Python, we can run this calculation across all 303 million matchups and determine the intrinsic value of all 286,000 horses.
Using the same principles as value investors like Warren Buffett, we discover and purchase undervalued or unrecognized assets and sell them at fair value. To date, we have traded over 400 horses and 90% of our trades have been profitable. Our most successful trade involved purchasing a horse for $4,000 and selling it for $12,000.
Thanks to our complex statistical and valuation models, we have been able to successfully determine the strength and intrinsic value of assets in Zed Run, earning over $115,000. Our discovery system even allows us to identify exceptionally strong horses based on small sample sizes, which we then purchase and sell to professional stables.
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