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I've been trying to google-fu this answer, or any variant of an answer for years. It's really bothering me; and so much that I actually decided to make a thread here. I'll seek out other forums afterward if there isn't a satisfactory answer provided. It seems to be very closely guarded information- but people have worked it into their subconscious that it's just your "basic house edge" "1%" or otherwise. .. but from what I understand about the edge in a Brick & Mortar casino it's basically an expectation of profit over time. In a digital environment we have a digital edge; so my question is : how does a software defined edge interact with a provably fair engine?

I don't really understand your question, but for instance, a provably fair engine can come up with a list of random values ranging from 00.00 to 99.99 in the game of Bitcoin Dice, for example.

The house edge is simply the product of what multiplier you receive based on the values you are allowed to choose from.

For instance, 49.50 or less for a 2x payout would be 1%, but a different operator could offer 49.95 or less for a 2x payout with a 0.1% house edge. Or 45.00 or less with a 10% house edge.

The provably fair system will just generate a large list of random values. The house edge is just the interpretation of what those values mean. This house edge works effectively identical to any brick & mortar house edge. One uses the laws of physics with say a roulette wheel and the other uses fancy maths, but both end up with the same fundamental results for users.

"Provably fair" does not mean the the casino does not have an advantage. It means that it can be proven that the outcomes are random and are not manipulated.

There's absolutely no difference between physical and online casinos in regards to how they make profit, and this isn't because the games are secretly rigged like some people think. The edge means that a casino is more likely to win because of the rules of the game. For example, in a game of roulette, your chance of guessing the correct result are 1 in 37, but the casino will never pay you x37 of your bet, they will pay you something like x35. So, mathematically speaking, such bet has negative expected value, if you will take this bet over and over, you will eventually run out of money in the long run, while casino will be making money.

What is this digital edge you even speak of anyway? Both types of casinos, online and offline all include house edge, and they're basically the same in that you're guaranteed to lose money to the casinos in the long run. It's not like the software or logic of a roulette in Brick & Mortar casinos are fundamentally different from those of online roulettes, same with other type of games, they retain the same basic aspects that Brick & Mortar games have, House edge and the style of game they have. If you're talking about table games such as Poker, then let me tell you that it has none. The casinos only take a portion of the fees the players pay, as well as from the pot or something like that.

house edge in normal casinos are calculated from expected RTP, especially with games of slots or blackjack correct but as the skilldatz answers, the provably fair games like dice make it super easy to see the exact house edge, as they calculate it directly into the payout or win chance.

1% is immediately apparent from the payout of 2x but with only a  49.5% win chance.

The house edge that digital casinos and physical casinos have are essentially the same, that in the long run, people are bound to lose money to the casino if they continue playing. Provably fair is just an algorithm to ensure the players that the outcomes of the bet that they are playing on in a digital casino is not altered or manipulated in any way, There's nothing so special about it, IMO. It's just a way for casinos to embed trust within their platform by letting the players do the checking of seed themselves.

That's generally just a matter of probabilities and combinations.
To get a house edge of 1%, you should have an unwinnable round every 100 rounds.
Or for a game with 100 possible outcomes, having 1 outcome that is unwinnable, ie you can't bet on it but it can come out.

Casino's expected profit . On average it should be around that number


We dont. Standard European Roulette on either casino or gambling website should have the same house edge


You seems to be confusing both of it. Provably fair has nothing to do with house edge. Provably fair system only act as a safeguard to make sure the operator of those site wouldnt be able to cheat without getting caught provided that if you check your bet

Here is a detailed explanation on how the house edge of each game is actually calculated from @Webtricks

https://bitcointalk.org/index.php?topic=5262141.msg55378243#msg55378243

Most casinos are expected to profit in the long run. What are you trying to ask if the casinos will be giving more chances for the gamblers to win, isn't it? they are no charity but they have provably fair which gives the gamblers the idea that the bets are well-verified and not controlled by the casino.

Read the explanation made by odolvlobo.

Thanks for the mention @arallmuus. I will try answering OP's query with another perspective to make things more clear:


Hey blxn,

I understand your confusion. It is difficult to imagine how can a software be fair and at the same time provide edge to the casino, right? To understand how the system works, let's take an example:

Suppose you and me are playing a game. We would pick a number between 1 and 100 and if the number is between 1 and 52, I win and if the number is between 53 and 100, you win. Now it maybe possible that the number turns out to be 77 in first attempt so you will win. But say, we play this game 10K times, who do you think will have edge in the long run? In long run, I will win more rounds because my winning chances are 52% while you only got 48% chance!!

So let's translate the above explained game into casino terms:

House Edge: Since I have 52% chance to win the bets in long run, this is called house edge.

Provably Fair: Since the number is picked randomly, this is called Fairness.

How it works technically?
In every Casino game, we try to draw a number between 0 and 1 as randomly as possible. Then we multiply the drawn number with the total number of possibilities. The resulting number is then rounded off and the nth number in the sequence is the result. This is how fairness is maintained digitally. Confusing, eh? Let me give an example:


In a traditional roulette game, there are 38 possible scenarios. We first try to pick a number between 0 and 1 as randomly as possible. Let say we got 0.6225. Then we multiply the number with 38.

38 * 0.6225 = 25.175.

Now we round off 25.175 to upper integer i.e. 26. So the result of the roulette wheel of the round should be 26.