Bitcoin Forum

Hi!

Question about wager processing with the bitcoin network. If at any point in here you know which resource to which to direct my attention, please do. I've done some research but I'm certain to have missed something.

Bombs away!

I want to take bets on the outcome (binary) of an event and have have my payouts publicly verifiable.

I create a wallet for each outcome. Customers place bets by transferring coins to the wallet. At the conclusion of the event, I transfer all coins from the losing wallet to the winning wallet. I then pay out to the bet winners from the winning wallet.

Questions:
 - Does this method guarantee that the network can audit my honesty in bet processing?
 - Is it necessary for me to send coins from the losing wallet to the winning wallet in order to prove my honesty?
 - What other ways would you suggest setting up a high-trust wager clearinghouse?

Thanks!
ikb

i'm confused

To control someones wallet you need their private key, people don't like giving that up and many don't even know how to.

My advise is to clearly define the bet contract, sha256 it with a secret salt, publish the hash of the salt and then create a bitcoin address based off of that salted sha256.

That way the very existence of the address/private key proves the wording of the bet contract. The secret salt would be released after the bet is over and can be confirmed by the pre-release of its hash. The bet contract is not valid until it of fully funded by both sides and an arbiter interprets the contact and transfers the money.

Provable ahead of time, and confirmable later.

Be careful about your terminology.  There is no need to use two "wallets".  Nobody can determine how many "wallets" you are using, so using one "wallet", two "wallets", or ten "wallets" isn't going to make a difference.  What you seem to be suggesting is using two different "addresses", and yes if you publicly advertise which address is associated with wager, then the blockchain will provide a method for proving the total number of bets placed on each outcome.  Since the wager "addresses" will be publicized, there isn't a lot of benefit to combining the balances from the two addresses into a single address before paying out winning wagers.  The winners can simply have their initial bets sent back to them, and their "winnings" paid to them directly from the address that represents the "losing" wagers.  If you really want to increase the visibility of the connection between winning and loosing wagers, you could create a single transaction to pay all winners.  The transaction would take all of the wagers from both addresses as inputs, and then have an output for each and every winning payee.