Is it just me, or are the betting rules on Bets of Bitcoin, er, incomprehensible? It takes the worst form of betting—parimutuel betting in horse racing—in common use in America, and adds a bunch of arbitrary time based rules to adjust how bitcoins are spread among the winners. In order to actually make a bet there, I would have to estimate:
The probability of an event occurring.
An expectation of the amount of betting to occur on the other side of the bet.
An expectation of the amount of betting to come into my side of the bet until the period when the bet closes.
The actual time distribution of bets on my side for both existing bet sums (this information is not disclosed), and forthcoming bet sums.
I’m fairly certain this is the worst betting scheme I’ve ever seen, and I’m somewhat suspicious of it given the general sketchiness of the bitcoin community (partially offset by the revealed incompetence of the bitcoin community). One notable casualty of this system is the ability to convert their betting information into informational probability estimates of the event occurring.
I’m not competent to comment on the ‘revealed incompetence of the Bitcoin community’, but for the benefit of those who aren’t aware of those issues, it would useful if you could either summarize that revelation or post a link to such a summary.
No, it’s not just you—I was really excited when I heard of it since I had been forced to stop using Intrade due to the fees (and now Intrade is offlimits period), but as I read through the FAQ and the rules, my reaction was, as I started: ლ(╹◡╹ლ) As the rules began to dawn: ⊙ｏ⊙ And finally: ╰(‵皿′＊)╯︵ ┻━┻
But of course it’s still a source of predictions even if you’d have to be insane to use it.
Consider that a rhetorical flourish rather than an academic fact.
In blackjack, sports betting, roulette, and slots, you only face uncertainty in the outcome of the event. In parimutuel betting you face uncertainty in the outcome of the event, and also due to the movement of the odds based on the opinions of others after your bet is placed. Lotteries also exhibit this since a greater number of lottery players increases the size of the lottery, but also increases the probability that multiple people will select the same set of numbers. Poker probably has some characteristics of this too, but trying to force an interactive, strategic game with random elements into this outcome betting paradigm probably stretches the comparison to the point of breaking.
The dimension it’s bad along is “fun for players who want to be able to make bets based on their opinions of the outcomes of events.” Of course, blackjack, roulette, and slots may not be very fun for this player either, but sports betting is probably more fun than horse racing.
Well, in principle I see what you are talking about—if a lot of people bet your side, then your payoff can be reduced, perhaps to the point where you wouldn’t have taken the bet. But, at least for reasonably well-subscribed bets, won’t you, in the long run, do well enough by equating the ratio of future bets to the ratio of current bets? In other words, the odds should be as likely to move in your favour as against you.
That’s basically true for horse racing because all the relevant information is known in the minutes before the race and you can make your final bet. For a prediction market you would actually expect that if you have an informational advantage, the odds will move closer to your estimate over time as that information is revealed or processed by other market participants. The time frame on Bets of Bitcoin is long enough that genuine information will be revealed in the meantime for many bets. Because later bets aren’t “worth” as much as earlier bets, though, it’s impossible to say how much this would affect the actually payoffs without having a specific example to consider, though.
Is it just me, or are the betting rules on Bets of Bitcoin, er, incomprehensible? It takes the worst form of betting—parimutuel betting in horse racing—in common use in America, and adds a bunch of arbitrary time based rules to adjust how bitcoins are spread among the winners. In order to actually make a bet there, I would have to estimate:
The probability of an event occurring.
An expectation of the amount of betting to occur on the other side of the bet.
An expectation of the amount of betting to come into my side of the bet until the period when the bet closes.
The actual time distribution of bets on my side for both existing bet sums (this information is not disclosed), and forthcoming bet sums.
I’m fairly certain this is the worst betting scheme I’ve ever seen, and I’m somewhat suspicious of it given the general sketchiness of the bitcoin community (partially offset by the revealed incompetence of the bitcoin community). One notable casualty of this system is the ability to convert their betting information into informational probability estimates of the event occurring.
I’m not competent to comment on the ‘revealed incompetence of the Bitcoin community’, but for the benefit of those who aren’t aware of those issues, it would useful if you could either summarize that revelation or post a link to such a summary.
https://bitcointalk.org/index.php?topic=83794.0;all is a reasonably good start at listing the various scams and frauds and hacks.
See also http://polimedia.us/trilema/2012/the-bitcoin-drama-timeline/
No, it’s not just you—I was really excited when I heard of it since I had been forced to stop using Intrade due to the fees (and now Intrade is offlimits period), but as I read through the FAQ and the rules, my reaction was, as I started: ლ(╹◡╹ლ) As the rules began to dawn: ⊙ｏ⊙ And finally: ╰(‵皿′＊)╯︵ ┻━┻
But of course it’s still a source of predictions even if you’d have to be insane to use it.
Why do you say that parimutuel betting is the worst form? What is the dimension along which it is bad?
Consider that a rhetorical flourish rather than an academic fact.
In blackjack, sports betting, roulette, and slots, you only face uncertainty in the outcome of the event. In parimutuel betting you face uncertainty in the outcome of the event, and also due to the movement of the odds based on the opinions of others after your bet is placed. Lotteries also exhibit this since a greater number of lottery players increases the size of the lottery, but also increases the probability that multiple people will select the same set of numbers. Poker probably has some characteristics of this too, but trying to force an interactive, strategic game with random elements into this outcome betting paradigm probably stretches the comparison to the point of breaking.
The dimension it’s bad along is “fun for players who want to be able to make bets based on their opinions of the outcomes of events.” Of course, blackjack, roulette, and slots may not be very fun for this player either, but sports betting is probably more fun than horse racing.
Well, in principle I see what you are talking about—if a lot of people bet your side, then your payoff can be reduced, perhaps to the point where you wouldn’t have taken the bet. But, at least for reasonably well-subscribed bets, won’t you, in the long run, do well enough by equating the ratio of future bets to the ratio of current bets? In other words, the odds should be as likely to move in your favour as against you.
That’s basically true for horse racing because all the relevant information is known in the minutes before the race and you can make your final bet. For a prediction market you would actually expect that if you have an informational advantage, the odds will move closer to your estimate over time as that information is revealed or processed by other market participants. The time frame on Bets of Bitcoin is long enough that genuine information will be revealed in the meantime for many bets. Because later bets aren’t “worth” as much as earlier bets, though, it’s impossible to say how much this would affect the actually payoffs without having a specific example to consider, though.