No House Edge?

[NorrisK]

The result of a fee and the house edge is the same in the end right? The house edge makes you lose more than you win, but the fee takes a percentage off all potential winnings. If the values are te same, net result would be equal? (as in, you lose money)

It is not the same. Theoretically house edge applied to your bet whenever you are winning or losing because it is the expected earning where the site might gain but the fee that are collected from winning usually only applied to the winners. Therefore it is just slightly different but it is not the same

But if you win just as often as you lose (asuming 50% win rate), and you pay the fee when you win, the net result would still be that you end up in the minus (based on the fee %).

[1715675228]

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[1715675228]

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[vendetahome]

The result of a fee and the house edge is the same in the end right? The house edge makes you lose more than you win, but the fee takes a percentage off all potential winnings. If the values are te same, net result would be equal? (as in, you lose money)

It is not the same. Theoretically house edge applied to your bet whenever you are winning or losing because it is the expected earning where the site might gain but the fee that are collected from winning usually only applied to the winners. Therefore it is just slightly different but it is not the same

But if you win just as often as you lose (asuming 50% win rate), and you pay the fee when you win, the net result would still be that you end up in the minus (based on the fee %).

well then either fees have to be huge, or the player has to gamble a lot of bitcoins for the fee to be a big amount of money so i think that wouldnt have any impact on busting player when gambling

[arallmuus]

The result of a fee and the house edge is the same in the end right? The house edge makes you lose more than you win, but the fee takes a percentage off all potential winnings. If the values are te same, net result would be equal? (as in, you lose money)

It is not the same. Theoretically house edge applied to your bet whenever you are winning or losing because it is the expected earning where the site might gain but the fee that are collected from winning usually only applied to the winners. Therefore it is just slightly different but it is not the same

But if you win just as often as you lose (asuming 50% win rate), and you pay the fee when you win, the net result would still be that you end up in the minus (based on the fee %).

Indeed yes if you have both the same number for win and lose your profit is 0 and your net profit will be in minus since there is a cut in every winning that you got but since you are saying that both fee and the house edge are the same in this term, then your statement is wrong.
Assuming you are playing at 2x payout with 49.5 %  chance and you got the same number for win and lose then your net profit is not on minus but if you are playing with 50 % chance then it is a minus

[dooglus]

Indeed yes if you have both the same number for win and lose your profit is 0 and your net profit will be in minus since there is a cut in every winning that you got but since you are saying that both fee and the house edge are the same in this term, then your statement is wrong.
Assuming you are playing at 2x payout with 49.5 %  chance and you got the same number for win and lose then your net profit is not on minus but if you are playing with 50 % chance then it is a minus

A 1% house edge is the same as paying a 1% fee on all payouts from a 0% edge game.

  * 1% game: pays out 1.98x at 50%

  * 0% game with 1% fee: pays out 2x at 50%, but takes 1% of that, leaving 1.98x.

Get it?

[fairlay]

The gambling site owner have to earn money through the house edge, so you can't expect there is no hous edge.

That is exactly what we offer. We offer 0% fees on all sport bets: https://www.fairlay.com/event/category/soccer/ Since we don't take a position but instead user bet against user the average user has an expected value of 0. If your bets are better than the average user your bets will make money in the long run.

Fees and house edge are quite different things all together.

On sport betting sited the "house edge" is usually the spread of the odds. However - we are an exchange where user bet directly against each other - so there is no spread. A dice site could operate with 0 house edge as well if bets where user against user.

PD has or used to have PvP dice. not sure what state it's in now.  didnt seem very fun.  i would assume that sooner or later, the house would invoke a "rake" on it to monetize it somehow.  Unless it was a real source of traffic for the site (then you just cover the cost as marketing)

so i assume you guys aren't making any money off the PvP bets?  where does your rake come into play then?

You are right - it is similar to a marketing expense too us. We have 0% fees on the p2p sport bets - especially because here everything is done automatically - the obviously have data feeds for the sport events. On all other events like: will the block size limit be raised by march 2016 we need to moderate them and so we take a 2% fee. https://www.fairlay.com/event/category/bitcoin/

[arallmuus]

Indeed yes if you have both the same number for win and lose your profit is 0 and your net profit will be in minus since there is a cut in every winning that you got but since you are saying that both fee and the house edge are the same in this term, then your statement is wrong.
Assuming you are playing at 2x payout with 49.5 %  chance and you got the same number for win and lose then your net profit is not on minus but if you are playing with 50 % chance then it is a minus

A 1% house edge is the same as paying a 1% fee on all payouts from a 0% edge game.

  * 1% game: pays out 1.98x at 50%

  * 0% game with 1% fee: pays out 2x at 50%, but takes 1% of that, leaving 1.98x.

Get it?

Ahh thankyou Dooglus for this clarification I thought that the 1% fee will be leaving the net profit to be 1.99x though than this is how I assume that they are both different since 50% at gambling sites is leaving a profit for 1.98x. Since this is about 50 % chance will it still be the same assuming that it is not at 50 % chance to win Doog?

P.S : I got it right at the bolded part though  although it is not entirely correct

[unholycactus]

Indeed yes if you have both the same number for win and lose your profit is 0 and your net profit will be in minus since there is a cut in every winning that you got but since you are saying that both fee and the house edge are the same in this term, then your statement is wrong.
Assuming you are playing at 2x payout with 49.5 %  chance and you got the same number for win and lose then your net profit is not on minus but if you are playing with 50 % chance then it is a minus

A 1% house edge is the same as paying a 1% fee on all payouts from a 0% edge game.

  * 1% game: pays out 1.98x at 50%

  * 0% game with 1% fee: pays out 2x at 50%, but takes 1% of that, leaving 1.98x.

Get it?

Thank you for showing up I thought I would never be able to explain this.

You can't create money, someone has to lose and someone has to win.

[dooglus]

Ahh thankyou Dooglus for this clarification I thought that the 1% fee will be leaving the net profit to be 1.99x though than this is how I assume that they are both different since 50% at gambling sites is leaving a profit for 1.98x. Since this is about 50 % chance will it still be the same assuming that it is not at 50 % chance to win Doog?

P.S : I got it right at the bolded part though  although it is not entirely correct

The 'house edge' is effectively a fee on the entire payout amount, including your stake. 1% of 2 is 0.02, leaving 1.98x from the 2x payout.

If a site was to charge 1% of just your profit, that would be a better deal for the player. Especially for the high-chance bets (like 98%) where almost all your payout is your initial stake and the profit is relatively small.

[asztar7]

I believe it would be impossible to create a casino without an edge unless you want to give out the money for free.
House edge makes the casino to earn money.
The only way would be to come up with a new way to earn from the players

[grendel25]

I believe it would be impossible to create a casino without an edge unless you want to give out the money for free.
House edge makes the casino to earn money.
The only way would be to come up with a new way to earn from the players

There are example in which casinos can make money without any house edge.  There's a horse betting site that's been in these boards fore the past week or so and what they do is collect a fee on winnings.  So Casinos could be profitable on fees alone depending on how the games are structured.

Another example is where it's all PVP like various poker games.

[WhatTheGox]

I believe it would be impossible to create a casino without an edge unless you want to give out the money for free.
House edge makes the casino to earn money.
The only way would be to come up with a new way to earn from the players

They can use advertising to fund the operation but yes the rake free model was also tried in online poker and never suceeded vs the rake sites.  Maybe bitcoin makes things a little different vs fiat.

[srgkrgkj]

I believe it would be impossible to create a casino without an edge unless you want to give out the money for free.
House edge makes the casino to earn money.
The only way would be to come up with a new way to earn from the players

They can use advertising to fund the operation but yes the rake free model was also tried in online poker and never suceeded vs the rake sites.  Maybe bitcoin makes things a little different vs fiat.

thats true but in fiat gambling if you actually go to a casino there is pretty much no edge but in bitcoin things are just different due to the ways sites operate as they dont get many bets compared to vegas casinos who are pretty much garunteed profit due to peoples greed

[asztar7]

I believe taking a fee just on winnings is much less profitable for a casino than an edge. Edge applies to every bet, to every strategy, when for example fee on winning just to the winning bet.

[arallmuus]

Ahh thankyou Dooglus for this clarification I thought that the 1% fee will be leaving the net profit to be 1.99x though than this is how I assume that they are both different since 50% at gambling sites is leaving a profit for 1.98x. Since this is about 50 % chance will it still be the same assuming that it is not at 50 % chance to win Doog?

P.S : I got it right at the bolded part though  although it is not entirely correct

The 'house edge' is effectively a fee on the entire payout amount, including your stake. 1% of 2 is 0.02, leaving 1.98x from the 2x payout.

If a site was to charge 1% of just your profit, that would be a better deal for the player. Especially for the high-chance bets (like 98%) where almost all your payout is your initial stake and the profit is relatively small.

You are right about this, it will be the same as house edge and the "fee" is usually based on the game payout which is stake + winning so in the end it will be the same with house edge calculation

P.S : never see a site that charge fee only on the winning coins though, most are from the payout (stake+winning)

I believe taking a fee just on winnings is much less profitable for a casino than an edge. Edge applies to every bet, to every strategy, when for example fee on winning just to the winning bet.

"Taking fee on winnings" could mean that the fee is taken on your payout which is stake+winning so it is the same as house edge but if the fee is only taken on winning then it would be slightly different

[XinXan]

Well i see a 0% house edge casino wont make any money but im sure if some casinos made it like, special day of 0% house edge, they would surely attract a lot of players and theoretically not lose anything

[katerniko1]

Well i see a 0% house edge casino wont make any money but im sure if some casinos made it like, special day of 0% house edge, they would surely attract a lot of players and theoretically not lose anything

your wrong -.-

[dooglus]

Well i see a 0% house edge casino wont make any money but im sure if some casinos made it like, special day of 0% house edge, they would surely attract a lot of players and theoretically not lose anything

There is a difference between expected profit and actual profit. Just because their expected profit would be zero for that day doesn't mean they would "theoretically not lose anything". They are much more likely to make a profit or loss on the day than they are to break even.

thats true but in fiat gambling if you actually go to a casino there is pretty much no edge but in bitcoin things are just different due to the ways sites operate as they dont get many bets compared to vegas casinos who are pretty much garunteed profit due to peoples greed

What makes you think there is "pretty much no edge" in B&M casinos? Double-zero roulette has an edge of over 5%.

And I don't know how many bets a typical Vegas casino takes per day. PrimeDice recently announced that they have taken 5 billion bets in the 2 years they've been up. That's 5000 million bets in ~700 days, or 7 million bets per day. I imagine that is more than an average B&M casino takes.

[NorrisK]

Indeed yes if you have both the same number for win and lose your profit is 0 and your net profit will be in minus since there is a cut in every winning that you got but since you are saying that both fee and the house edge are the same in this term, then your statement is wrong.
Assuming you are playing at 2x payout with 49.5 %  chance and you got the same number for win and lose then your net profit is not on minus but if you are playing with 50 % chance then it is a minus

A 1% house edge is the same as paying a 1% fee on all payouts from a 0% edge game.

  * 1% game: pays out 1.98x at 50%

  * 0% game with 1% fee: pays out 2x at 50%, but takes 1% of that, leaving 1.98x.

Get it?

This was exactly what I was getting at Thanks for putting it in numbers, always helps a ton!

So you always lose out, no matter the structure.

[XinXan]

Well i see a 0% house edge casino wont make any money but im sure if some casinos made it like, special day of 0% house edge, they would surely attract a lot of players and theoretically not lose anything

There is a difference between expected profit and actual profit. Just because their expected profit would be zero for that day doesn't mean they would "theoretically not lose anything". They are much more likely to make a profit or loss on the day than they are to break even.

thats true but in fiat gambling if you actually go to a casino there is pretty much no edge but in bitcoin things are just different due to the ways sites operate as they dont get many bets compared to vegas casinos who are pretty much garunteed profit due to peoples greed

What makes you think there is "pretty much no edge" in B&M casinos? Double-zero roulette has an edge of over 5%.

And I don't know how many bets a typical Vegas casino takes per day. PrimeDice recently announced that they have taken 5 billion bets in the 2 years they've been up. That's 5000 million bets in ~700 days, or 7 million bets per day. I imagine that is more than an average B&M casino takes.

Yes thats true but my idea is not making it only 1 day but rather make it occasionally like every sunday or 2 times per month, in the long term it shouldnt affect them and it would definitely make more people interested in that specific casino

[NorrisK]

Well i see a 0% house edge casino wont make any money but im sure if some casinos made it like, special day of 0% house edge, they would surely attract a lot of players and theoretically not lose anything

There is a difference between expected profit and actual profit. Just because their expected profit would be zero for that day doesn't mean they would "theoretically not lose anything". They are much more likely to make a profit or loss on the day than they are to break even.

thats true but in fiat gambling if you actually go to a casino there is pretty much no edge but in bitcoin things are just different due to the ways sites operate as they dont get many bets compared to vegas casinos who are pretty much garunteed profit due to peoples greed

What makes you think there is "pretty much no edge" in B&M casinos? Double-zero roulette has an edge of over 5%.

And I don't know how many bets a typical Vegas casino takes per day. PrimeDice recently announced that they have taken 5 billion bets in the 2 years they've been up. That's 5000 million bets in ~700 days, or 7 million bets per day. I imagine that is more than an average B&M casino takes.

Yes thats true but my idea is not making it only 1 day but rather make it occasionally like every sunday or 2 times per month, in the long term it shouldnt affect them and it would definitely make more people interested in that specific casino

Then again, it is not likely for you as a once a month gambler to actually feel the 0,5% house edge. This is something you notice after a lot of runs. If you only go once in a while, variance will take over and you may even end up winning or losing big.