Gambling sites do lose a lot of money due to people gambling using the Martingale system. In fact, the majority of people who use the Martingale system properly will make money. There are gambling sites that have more losing days than winning days because they have a lot of customers who are using Martingale correctly.

Of course, they win a lot more. And when they have winning days, the amounts they win are *much* greater than the amounts they lose. That's what Martingale does. It's like a reverse lottery where the house gives you $1, but one in a million times they blow up your house, kill your children, and cut off a few of your fingers. (Perhaps the Hunger Games are a better analogy.)

No. Bitcoin allows you to hold and transfer BTC, but that's it. (Unless you build things like colored coins on top of it.)

Update: I guess it sort of issues it too.

It's a platform for issuing, redeeming, holding, transferring, and trading arbitrary assets.

An implausible business model, implausibly high promised rates of return, and implausible claims of low risk are hallmarks of a ponzi scheme. If it sounds too good to be true ... well, you know the rest. If the most logical explanation is that it's a ponzi scheme, it's probably a ponzi scheme.

Typically, the fraud in a ponzi scheme consists of secretly using funds from later investors to pay off earlier investors. Generally, there will be some supposed business model (arbitrage, resale, whatever) that doesn't actually exist.

In a pyramid scheme, the use of funds from later investors to pay off earlier investors is typically disclosed. The key difference between a pyramid scheme and legitimate multi-level marketing is that a pyramid scheme has no real product sales. In a pyramid scheme, by design, the vast majority of the profit made by early investors comes from the fees paid by later investors and any products sold are, typically, a sham.

The line between MLM and pyramid schemes is not always a bright one. One giveaway is that pyramid schemes typically promise you a cut of the membership fees charged to your downline while MLM schemes focus on sharing the proceeds from your downline's sales. If you're getting a cut of your downline's membership fees, that means that part of your membership fees went to whoever brought you in. What *legitimate* purpose does that serve?

However, you can make the probability that you will make a profit as high as you want -- 99.9% if you like. The tradeoff is that the profit you will make will be very small relative to the amount you will lose in that 0.1% case. (This is true even if the house imposes relatively low limits. You just need to make some small tweaks to the system. However, it will mean that you may need to play for a *very* long time.)

That makes it a reverse lottery. That increases your probability of winning, but also increases the ratio of how much you win to how much you lose. It's like a reverse lottery where you get $1, but you have a one in a million chance of losing your house, wife, car, kids, job, and dignity.

That's right. You can change the odds around, but the edge remains precisely the same. If the house edge is 1% and your total bet is X, your expected profit is -X/100.

You can make it much more likely that you'll win than that you'll lose, and thus much more likely that the house will lose than that they'll win. But when you do lose, it will be *huge*.

So, you can turn this: 51% of the time you lose $1, 49% of the time you make $1.
Into this: 99.9% of the time you make $1, 0.1% of the time you lose just over $1,000.

Bitcoin betting systems see lots of people using Martingale. As a result, they have long stretches in which they lose money. Operators have become concerned that there was an exploit or defect in their system. But then you have the good day that makes up for all the losses.

Petabyte arrays are available. They're not exactly cheap.

http://www.aberdeeninc.com/abcatg/petarack.htm
http://www.simplstor.com/index.php/petabyte

Every system requires trust. The most obvious trust required with Bitcoin is that you trust that 51% of the mining power won't get together and agree to refuse to build on any blocks that include your transactions.

This is simply not so. For example:

"The mathematical probability of you not finding a block with the amount of work required to find 24 blocks is:
One in 81,000,000"

Also, we have his own words, such as his response to murdof.

We have "real proof" of very, very few things in life. Nevertheless, we have no difficulty making decisions based on the preponderance of available evidence. This isn't a metaphysical "how do you know you exist" kind of thing, nor is it a criminal case. This is just an ordinary "make the best decision you can with the evidence available to you" thing.

XRP is the only asset on Ripple that works this way, and it has to because it's used to pay transaction fees and there's no known way to support unlimited transactions.

If we followed that model, we'd either have a lot less money to spend on development and integration or we'd have to charge for lots of things we can do for free using the model we've chosen. We set things up the way we did because that was what we believed was best. The market will decide whether we made good decisions or not. If we chose wrong, we will lose to those who make better choices. Worst case, the world gets a payment system that's even better than Ripple. I can live with that.

No, because there can be a third party (market maker) involved who uses more than one exchange. You then have a five-party transaction. The sender transfers funds off-blockchain at gateway A from himself to the market maker. In exchange, the market marker transfers funds off-blockchain at gateway B from himself to the recipient.

If the game has a fixed limit, it is normal. But then it has no fixed limit because the first player may choose this game, causing it to take longer than its fixed limit because the game may now take up to its fixed limit plus the time the first player took choosing.

One more paradox: Aliens come to Earth with a brain scanner. The brain scanner appears to be able to predict human behavior with astonishing accuracy. To demonstrate its power and their generosity, the aliens present each human with two sealed boxes and a choice. The first box contains either a single dose of a potion that will prevent all disease or is empty. The second box always contains $20. Your choice is simple. You may choose either just the first box or both boxes.

You are standing in line and reason that when it's your turn to choose, the contents of both boxes are unchangeable. They are what they are. So you are better off choosing both boxes rather than just one. But then as you observe the people ahead of you in line, you notice that those who chose both boxes get just $20 while those that choose just the first box get the potion. You realize that the aliens must be using the brain scanning machine to determine whether each person will pick both boxes or just the first box and if they determine that they will pick both boxes, they make the first box empty.

What do you do?

Some games are guaranteed to terminate in a fixed amount of time. For example, tournament chess has time limits. Call a game that is guaranteed to terminate in a fixed amount of time "normal". Now, consider this game:

1) Two players are required.

2) The first player is chosen arbitrarily.

3) The first player has one minute to choose any normal game or they lose and the game ends.

4) The chosen game is played to its conclusion.

5) The winner of the chosen game wins.

Let's call this game "hypergame". The paradox: Is hypergame normal?

Congrats, Vod!

TL;DR: I have this wonderful plan for how to distribute value. Now, could someone please create some?

Response: Worry about how to create value first. Then we can talk about how to distribute it fairly and openly. The distribution is *not* the hard part.

So let's say you have a machine that has two wheels that can each be set for a number from zero to ten. You push a button, and an LED display lights up with the sum of those two numbers. Do you have to look inside the machine to tell if it's calculating or not?