Just-Dice.com : Invest in 1% House Edge Dice Game

[BigBitz]

I'm just lazy

[pikeadz]

Edit:  nevermind, I am dumb.

[wolverine.ks]

I was just thinking at breakfast this morning that the commission rate seemed really low in order to maintain the economic incentive to not run away with all the coins, then i saw the update to the contract. still seems low to me.

is the decision as follows?....   

earn 5% on the house profits, currently (.05*627 BTC) ---> 31.35 BTC / 15 Days = 2.09 BTC per day

-or-

take all 19,301 BTC and run

the lump sum would be 9234 days worth if profit averages remain steady, or 25 years, and thats not counting interest....

it seems to me that investors might feel more comfortable raising the commission even higher, so that the lump sum is not so much more attractive than continuing the business.

however, the low rates may be just to attract early investors. additionally there may be a 'reputation cost' when running away with the coins what might swings the figures.

thoughts?

[shawshankinmate37927]

I was just thinking at breakfast this morning that the commission rate seemed really low in order to maintain the economic incentive to not run away with all the coins, then i saw the update to the contract. still seems low to me.

is the decision as follows?....   

earn 5% on the house profits, currently (.05*627 BTC) ---> 31.35 BTC / 15 Days = 2.09 BTC per day

-or-

take all 19,301 BTC and run

the lump sum would be 9234 days worth if profit averages remain steady, or 25 years, and thats not counting interest....

it seems to me that investors might feel more comfortable raising the commission even higher, so that the lump sum is not so much more attractive than continuing the business.

however, the low rates may be just to attract early investors. additionally there may be a 'reputation cost' when running away with the coins what might swings the figures.

thoughts?

I think the fact that the community is willing to invest 19,301 BTC with dooglus is indicative of his trustworthiness.  There actually are some people in the world that have a conscience and genuinely aren't interested in scamming.  That said, if this is an elaborate scam, I don't see how raising the commission changes anything.

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.  Perhaps another solution could be arranged where a portion of the invested BTC are stored in paper wallets that are held by other trusted members of the community with the private keys being split amongst them in a manner that requires coordination by three out of five to send BTC to the hot wallet.

[nimda]

however, the low rates may be just to attract early investors. additionally there may be a 'reputation cost' when running away with the coins what might swings the figures.

thoughts?

The economic incentive at this point is not enough. You have to weigh reputation (which is useful in the future), morals, risk of being caught (basically zero, c.f. BS&T), and time value (better to have money now than later).

- What is the value of dooglus' reputation, to him? If you were in his shoes, how much money would it take before you sold your identity or scammed someone?
- What is the value of dooglus' morals? This is rather tricky to find out.
- How hard is it to find and prosecute him, under Canadian law? There's no precedent whatsoever, even in the USA. The closest that I can remember is the teenager who ran the BitMint or whatever it was getting scared into repayment by threat of lawsuit.
- dooglus is earning 5% of all profits, but he also probably has some unknown amount invested himself.

There are several different ways that he could pull off a scam without being caught, as well. He has read-write access to individual accounts, the bet history, the server secrets,
etc.
Also, watch the total invested sum. It's more dangerous once it's been past the peak for a while.

I think the fact that the community is willing to invest 19,301 BTC with dooglus is indicative of his trustworthiness.

You must be new here.

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about, if the millions of posts on this forum are any guide at all. It's also no excuse for anonymity.

Perhaps another solution could be arranged where a portion of the invested BTC are stored in paper wallets that are held by other trusted members of the community with the private keys being split amongst them in a manner that requires coordination by three out of five to send BTC to the hot wallet.

This I could get behind.

[shawshankinmate37927]

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about...

CrazyGuy made the mistake of not being concerned about this:

https://bitcointalk.org/index.php?topic=238680.msg2527433#msg2527433

[dooglus]

it seems to me that investors might feel more comfortable raising the commission even higher, so that the lump sum is not so much more attractive than continuing the business.

however, the low rates may be just to attract early investors. additionally there may be a 'reputation cost' when running away with the coins what might swings the figures.

The initial 1% rate was just picked at random.  I had no idea how much would be wagered, or what it would cost to run the site in terms of time and money.  It turns out it costs all available time, and prevents me from working on anything else.  So I suspect that the 5% rate is going to have to go up in time so I can continue to support myself.

For the time being however I want to keep the rate low to attract investors - a loss-leader if you will.  If it's too low and is actually scaring potential investors away then it's no good - I'm taking less than I could AND hurting the site at the same time.

The reason I don't run away with the money is (a) I'm not a thief and (b) I don't want to have to be looking over my shoulder for the rest of my life.  (c) "my bitcointalk rep" doesn't really come into it.  I'm amazed and flattered that people are willing to trust me so much, and won't abuse that trust.  But if I was a scammer, a million dollars would be worth destroying my reputation for I'm sure.  Luckily for everyone, I'm not.

[bobboooiie]

On the lighter note, soon hitting 50k wagered. Pretty impressive for how young the site is. GJ !

[BigBitz]

it seems to me that investors might feel more comfortable raising the commission even higher, so that the lump sum is not so much more attractive than continuing the business.

however, the low rates may be just to attract early investors. additionally there may be a 'reputation cost' when running away with the coins what might swings the figures.

The initial 1% rate was just picked at random.  I had no idea how much would be wagered, or what it would cost to run the site in terms of time and money.  It turns out it costs all available time, and prevents me from working on anything else.  So I suspect that the 5% rate is going to have to go up in time so I can continue to support myself.

For the time being however I want to keep the rate low to attract investors - a loss-leader if you will.  If it's too low and is actually scaring potential investors away then it's no good - I'm taking less than I could AND hurting the site at the same time.

The reason I don't run away with the money is (a) I'm not a thief and (b) I don't want to have to be looking over my shoulder for the rest of my life.  (c) "my bitcointalk rep" doesn't really come into it.  I'm amazed and flattered that people are willing to trust me so much, and won't abuse that trust.  But if I was a scammer, a million dollars would be worth destroying my reputation for I'm sure.  Luckily for everyone, I'm not.

I like the idea of split key or shared key use.

[nimda]

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about...

CrazyGuy made the mistake of not being concerned about this:

https://bitcointalk.org/index.php?topic=238680.msg2527433#msg2527433

He's an outlier. Would you like hundreds of links to people who made the mistake of not being concerned about scammers? How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

[shawshankinmate37927]

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about...

CrazyGuy made the mistake of not being concerned about this:

https://bitcointalk.org/index.php?topic=238680.msg2527433#msg2527433

He's an outlier. Would you like hundreds of links to people who made the mistake of not being concerned about scammers? How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

I didn't say I wasn't concerned about scammers.  If dooglus ends up being a scammer, then I assume responsibility for my loss because I chose to trust the wrong person.  There are ways to reduce the risk, I just don't think raising the commission accomplishes this, and dooglus being a scammer is not the only risk that investors are assuming.

Another possibility:  What if the authorities decide his site is illegal and decide to confiscate the computer with the offline wallet?  Are investors protected from such a scenario?

I can only speak for myself.  But, the reason I haven't invested more is because of physical security concerns, not because I'm worried about getting scammed by dooglus.

[nimda]

He's an outlier. Would you like hundreds of links to people who made the mistake of not being concerned about scammers? How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

I didn't say I wasn't concerned about scammers.  If dooglus ends up being a scammer, then I assume responsibility for my loss because I chose to trust the wrong person.  There are ways to reduce the risk, I just don't think raising the commission accomplishes this, and dooglus being a scammer is not the only risk that investors are assuming.

My initial quote was:

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about...

... thus implying that you should be more concerned of a scam than a theft, especially since doog uses a cold wallet.

Another possibility:  What if the authorities decide his site is illegal and decide to confiscate the computer with the offline wallet?  Are investors protected from such a scenario?

I still think theft is the most probable scenario.
Another possibility: What if dooglus accidentally lights every copy of his offline wallet on fire simultaneously? Are investors protected?

I can only speak for myself.  But, the reason I haven't invested more is because of physical security concerns, not because I'm worried about getting scammed by dooglus.

Are you a betting man? I have some odds you might want to look at.

[dooglus]

Also, watch the total invested sum. It's more dangerous once it's been past the peak for a while.

One thing that nobody seems concerned about is the following:

I say there's around 19k BTC invested.  I show a cold wallet with 19k in it (more actually - some investors divest large amounts when the house is over 1% profit, because "invisible strings" or some such, but leave the coins in their balanace).

But what if in reality 50 different people have invested 1k each?  I could have spent the extra 30k already and nobody would be able to tell.  I've not proved that I'm making the total invested amount public, and could in effect be operating a fractional reserve operation.  That would only be discovered when people try to withdraw, and the 19k runs out.

I figure an easy way to avoid this risk is for me to list the 'base' figure for each investor.  You can find yours in the 'history' tab, in the 'investments' report (the number in the bottom right corner).

I'll publish a list of investors (with all details removed except for the 'base' amount) after each Sunday commission run, starting this coming weekend.  Then people can check that their investment is included in the published total, and shout if it isn't.

Edit: so divest a random number of bitcents and dust to make your base amount unique.  Then I can't pass off 4 separate 1k investments as a single investment and spend the other 3).

[dooglus]

How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

Unlike with Pirate however, everyone understands my business model and can see it working in real time.  I'm aiming for total transparency (without disclosing the identity of investors).

[dooglus]

Another possibility:  What if the authorities decide his site is illegal and decide to confiscate the computer with the offline wallet?  Are investors protected from such a scenario?

It would be foolish not to have multiple encrypted backups of the wallet in multiple locations.  So "yes".

[shawshankinmate37927]

He's an outlier. Would you like hundreds of links to people who made the mistake of not being concerned about scammers? How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

I didn't say I wasn't concerned about scammers.  If dooglus ends up being a scammer, then I assume responsibility for my loss because I chose to trust the wrong person.  There are ways to reduce the risk, I just don't think raising the commission accomplishes this, and dooglus being a scammer is not the only risk that investors are assuming.

My initial quote was:

I'm more worried about someone figuring out where he lives and stealing the computer that contains the offline wallet.

That is not what you should be concerned about...

... thus implying that you should be more concerned of a scam than a theft, especially since doog uses a cold wallet.

I wouldn't be investing any BTC with him if getting scammed was my main concern.

Another possibility:  What if the authorities decide his site is illegal and decide to confiscate the computer with the offline wallet?  Are investors protected from such a scenario?

I still think theft is the most probable scenario.
Another possibility: What if dooglus accidentally lights every copy of his offline wallet on fire simultaneously? Are investors protected?

There are ways to protect from this, yes.

I can only speak for myself.  But, the reason I haven't invested more is because of physical security concerns, not because I'm worried about getting scammed by dooglus.

Are you a betting man? I have some odds you might want to look at.

No.  I am an investor though.  Every bitcoin investment requires an element of trust.  I invest in individuals that I consider to be competent and trustworthy and spread the risk accordingly.  If I was worried about everyone being a scammer, I'd just put my BTC in a paper wallet and let them sit.

[Dabs]

Make a bet on that other site? Set a deadline. The "bet if dooglus is a scammer"... I think it's called bitbet? Which incidentally is one of the adverts on just-dice. http://bitbet.us/

hehehe. That would ... work both ways. You make a bet that he isn't going to disappear with 19k BTC, or you bet that he will disappear with 19k BTC.

It's a gamble either way.

[nimda]

I wouldn't be investing any BTC with him if getting scammed was my main concern.

This is one of those statements that sounds intuitive (e.g. "follow your dreams"), but doesn't actually prove anything.

Getting scammed is my main concern, yet I do have BTC invested. Serious injury or death is my main concern when I skydive. I still do it.

I still think theft is the most probable scenario.
Another possibility: What if dooglus accidentally lights every copy of his offline wallet on fire simultaneously? Are investors protected?

There are ways to protect from this, yes.

That does not answer the question at hand: "are investors protected?"
It also completely dodges the intent of the analogy, destroying any hopes I had for a reasonable conversation.

"I'm worried about alien abduction"
"What happens if our log cabin spontaneously combusts while the whole town is inside, will we be ok?"
"Fire extinguishers exist in some countries."

I can only speak for myself.  But, the reason I haven't invested more is because of physical security concerns, not because I'm worried about getting scammed by dooglus.

Are you a betting man? I have some odds you might want to look at.

No.  I am an investor though.  Every bitcoin investment requires an element of trust.  I invest in individuals that I consider to be competent and trustworthy and spread the risk accordingly.  If I was worried about everyone being a scammer, I'd just put my BTC in a paper wallet and let them sit.

Are you a hedging man? I have some potentially profitable odds you might want to look at.

Another possibility:  What if the authorities decide his site is illegal and decide to confiscate the computer with the offline wallet?  Are investors protected from such a scenario?

It would be foolish not to have multiple encrypted backups of the wallet in multiple locations.  So "yes".

I believe the American police said that they managed to "confiscate" some BTC. What actually happened was they received BTC at a honeypot's address, but still, they generated an address. In 5 year's time, they'll be pushing transactions from confiscated privkeys.

Unless, of course, Canada is one of the countries that does not mandate privkey disclosure?

How about Pirate, who was so trusted as to have an OTC rating in the several-hundreds?

Unlike with Pirate however, everyone understands my business model and can see it working in real time.  I'm aiming for total transparency (without disclosing the identity of investors).

That's very true, and I assess your risk to be lower than his. This is different from, but influences, your "trustworthiness."

One thing that nobody seems concerned about is the following:

That's an interesting problem and an interesting solution.

Make a bet on that other site? Set a deadline. The "bet if dooglus is a scammer"... I think it's called bitbet? Which incidentally is one of the adverts on just-dice. http://bitbet.us/

hehehe. That would ... work both ways. You make a bet that he isn't going to disappear with 19k BTC, or you bet that he will disappear with 19k BTC.

It's a gamble either way.

I don't want a deadline. We merely disagree on the probabilities of different ways that the site could die, not the probability of it dying before some deadline.

[RationalSpeculator]

One thing that nobody seems concerned about is the following:

I say there's around 19k BTC invested.  I show a cold wallet with 19k in it (more actually - some investors divest large amounts when the house is over 1% profit, because "invisible strings" or some such, but leave the coins in their balanace).

But what if in reality 50 different people have invested 1k each?  I could have spent the extra 30k already and nobody would be able to tell.  I've not proved that I'm making the total invested amount public, and could in effect be operating a fractional reserve operation.  That would only be discovered when people try to withdraw, and the 19k runs out.

I figure an easy way to avoid this risk is for me to list the 'base' figure for each investor.  You can find yours in the 'history' tab, in the 'investments' report (the number in the bottom right corner).

I'll publish a list of investors (with all details removed except for the 'base' amount) after each Sunday commission run, starting this coming weekend.  Then people can check that their investment is included in the published total, and shout if it isn't.

Edit: so divest a random number of bitcents and dust to make your base amount unique.  Then I can't pass off 4 separate 1k investments as a single investment and spend the other 3).

I admire you help investors see the vulnerabilities. I think your solution is very well thought out.

[dooglus]

I admire you help investors see the vulnerabilities. I think your solution is very well thought out.

What else am I going to do with them, exploit them? 

And it's not an original solution.  I came across it first here:

Can you prove my bullion is in the vault ?

Yes. Our vault operators send us bar lists evidencing what they hold in the vault for BullionVault.  These lists detail the individual bars in our section of the vaults, and their assayed gold or silver content.

Every business day we publish these bar lists on the BullionVault website, and we also publish our custody lists daily - but with alias names which users can recognise for themselves while they remain completely useless and meaningless to everyone else.

You can see your own holding, check our totals, and cross check the custody list totals directly to the bar lists.  All this is on the publicly accessible 'DAILY AUDIT' page. You can view it right now.  Click here for details of the procedure.

So the cold wallet is the 'bar list' and the (soon to be published) list of 'base amounts' is the 'custody list'.