Comments on: BitBet is quite the lulzmine http://trilema.com/2013/bitbet-is-quite-the-lulzmine/ Moving targets for a fast crowd. Thu, 07 May 2026 08:59:36 +0000 http://polimedia.us hourly 1 By: Mircea Popescu http://trilema.com/2013/bitbet-is-quite-the-lulzmine/#comment-92902 Mircea Popescu Wed, 24 Apr 2013 14:11:48 +0000 http://trilema.com/?p=47382#comment-92902 @<b>jurov</b> Your example (1:1 at 90`000, 201:1 at 85`000) proposes that no further bets are made. While it is indeed possible that in that scenario described the later bettor spends ~1 BTC of his own money to produce a ~0.005 loss to the other people on his side, nevertheless I would say it is more likely that his large bet attracts further betting on the opposite side (from people who judge the odds to be better than 201:1) and thus on the balance of probabilities I'd say he's likely to create a profit, rather than a loss for his own side, this because out of every 1 BTC bet against the winning side, the 200 BTC guy and the 1 BTC guys split the proceeds not exactly by capital contributed, but slightly in favour of the earlier 1 BTC guys (because of weight). To give numeric clothing to these theoretical considerations : <ol><li>#1 Bet 1 BTC on loser side at 90k weight. Total loser weight = 90k.</li> <br /><li>#2 Bet 1 BTC on winner side at 90k weight. Total winner weight = 90k.</li> <br /><li>#3 Bet 200 BTC on winner side at 85k weight. Total winner weight = 17.09mn.</li></ol> At this point the #2 are entitled to 90/17090 = 0.5266238% of the loser side in spite of contributing 1/201 = 0.4975124% of the capital on the winning side. The difference of 0.0291114% means that should someone make a further bet on the loser side the #2 people will get slightly more than what their risked capital entitles them. Since BitBet doesn't allow extremely lopsided bets ("The moon will come out tonight" etc) it is unlikely that a 200 BTC bet on a previously 1:1 proposition will attract absolutely no further betting from anyone, and so I'd say on the balance of probabilities the earlier betters benefit from later heavy betting. I would go as far as to say that seed betting (ie, placing some bets early on on many propositions) is a legitimate business model if properly administered, liable to generate reasonable (for a BTC investment) monthly profits and ROI. @jurov Your example (1:1 at 90`000, 201:1 at 85`000) proposes that no further bets are made. While it is indeed possible that in that scenario described the later bettor spends ~1 BTC of his own money to produce a ~0.005 loss to the other people on his side, nevertheless I would say it is more likely that his large bet attracts further betting on the opposite side (from people who judge the odds to be better than 201:1) and thus on the balance of probabilities I'd say he's likely to create a profit, rather than a loss for his own side, this because out of every 1 BTC bet against the winning side, the 200 BTC guy and the 1 BTC guys split the proceeds not exactly by capital contributed, but slightly in favour of the earlier 1 BTC guys (because of weight).

To give numeric clothing to these theoretical considerations :

  1. #1 Bet 1 BTC on loser side at 90k weight. Total loser weight = 90k.

  2. #2 Bet 1 BTC on winner side at 90k weight. Total winner weight = 90k.

  3. #3 Bet 200 BTC on winner side at 85k weight. Total winner weight = 17.09mn.

At this point the #2 are entitled to 90/17090 = 0.5266238% of the loser side in spite of contributing 1/201 = 0.4975124% of the capital on the winning side. The difference of 0.0291114% means that should someone make a further bet on the loser side the #2 people will get slightly more than what their risked capital entitles them.

Since BitBet doesn't allow extremely lopsided bets ("The moon will come out tonight" etc) it is unlikely that a 200 BTC bet on a previously 1:1 proposition will attract absolutely no further betting from anyone, and so I'd say on the balance of probabilities the earlier betters benefit from later heavy betting. I would go as far as to say that seed betting (ie, placing some bets early on on many propositions) is a legitimate business model if properly administered, liable to generate reasonable (for a BTC investment) monthly profits and ROI.

]]> By: jurov http://trilema.com/2013/bitbet-is-quite-the-lulzmine/#comment-92898 jurov Wed, 24 Apr 2013 09:11:20 +0000 http://trilema.com/?p=47382#comment-92898 Oh and there's an error in the faq, it says: 99% of his original bet sum (1% goes to BitBet.us) plus 99% of his bet times the total bet by the losing side multiplied by *the winning side total weight* and divided by *his bet's total weight.* and it should be: 99% of his original bet sum (1% goes to BitBet.us) plus 99% of his bet times the total bet by the losing side multiplied by *his bet's total weight* and divided by *winning side total weight.* Oh and there's an error in the faq, it says: 99% of his original bet sum (1% goes to BitBet.us) plus 99% of his bet times the total bet by the losing side
multiplied by
*the winning side total weight*
and divided by
*his bet's total weight.*

and it should be: 99% of his original bet sum (1% goes to BitBet.us) plus 99% of his bet times the total bet by the losing side
multiplied by
*his bet's total weight*
and divided by
*winning side total weight.*

]]> By: jurov http://trilema.com/2013/bitbet-is-quite-the-lulzmine/#comment-92897 jurov Wed, 24 Apr 2013 09:07:58 +0000 http://trilema.com/?p=47382#comment-92897 Aside from lulz, let's explore some (although extreme) scenario where later bets cause winners to get less than their bet. Let's start with 1:1 btc bets at weights 90000. Then someone bets 200BTC with weight 85000 and ends up winning. Payouts would be: total winning weight: 17590000 losing weight: 90000 0.99 + 0.99*1*90000/17590000 = 0.995065 BTC (0.4935% loss) 198+198*1*85000/17590000 = 198.95679 BTC (0.5216% loss) 0.5% potential loss for such unlikely case is not really something to scream bloody murder about, imho. Aside from lulz, let's explore some (although extreme) scenario where later bets cause winners to get less than their bet.
Let's start with 1:1 btc bets at weights 90000. Then someone bets 200BTC with weight 85000 and ends up winning. Payouts would be:

total winning weight: 17590000
losing weight: 90000

0.99 + 0.99*1*90000/17590000 = 0.995065 BTC (0.4935% loss)

198+198*1*85000/17590000 = 198.95679 BTC (0.5216% loss)

0.5% potential loss for such unlikely case is not really something to scream bloody murder about, imho.

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