bustabit – The original crash game

[xxjumperxx]

Ufff, that change to Bankroll will def. make people divest...
Whats the point of it though?
Does devans make more profit if the Bankroll is smaller?

[1714833527]

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[1714833527]

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[🏰 TradeFortress 🏰]

Managing thousands of bitcoins is a serious liability; not an asset, especially as the price of bitcoin goes up.

[micky123]

I bet lots of investors won't even notice these changes and just leave their investment there, even if they may be paying a 100% fee. I wonder what percentage of the bankroll is composed of that kind of investors.

I fall in this bracket you mention. The way i understand it (and i maybe wrong), is that bustabit is pegging the currency to XDR which is apparently a bunch of FIAT currencies rolled into one!?

So will i get paid in XDR, or will that XDR be converted to the prevailing BTC rate at the time of dilution, and i get the corresponding BTC amount?

Sorry but i am quite confused with this change. I will let it ride for now and see how it pans out over a month or two.

[devans]

One issue I have with the complexity, is that it's pretty annoying to do the calculations. Like I'm not sure exactly where to even get XDR information (admittedly, I've only heard of it just now). I see on XE: https://www.xe.com/currencyconverter/convert/?Amount=1&From=XDR&To=XBT

1XDR = 0.0000402910 bitcoin


Which means you're effectively targeting a cap of ~2216 BTC (at current value) bankroll, which effectively gets phased in over a year.  I don't really know how to see what the "360-day moving average of BTCXDR" is, so it's hard to see what the commission will start off as.

Since you can't actually buy or sell XDR no exchange provides XDRUSD rates directly, but it's equivalent to BTCUSD/XDRUSD, for example. This chart shows the price of Bitcoin in XDR, with the blue line you see at the bottom being the 360-day moving average:



Currently the 360-day average is approximately 9,600 XDR, so if the change came into effect today the commission rate would be:

Code:

4,251 BTC * 9,600 XDR/BTC / 55,000,000 XDR = 40,809,600 / 55,000,000 XDR = 74.2%

I think it's important to make that information easily available via:
bustabit.com/investing-stats.txt

Which updates every day with something like:


date | current_commission_% | bankroll_in_btc | bankroll_profit_in_btc | BTCXDR |  BTCXDR_MOVING_AVERAGE
------------------------------------------------------------------------------------------------------------

Agreed. I'll also show the current commission rate on the bankroll overview page.

[StackGambler]

Ufff, that change to Bankroll will def. make people divest...
Whats the point of it though?
Does devans make more profit if the Bankroll is smaller?

At the moment, all of the biggest bets are easily accomodated by a much smaller bankroll. This means whatever part of the bankroll isn't being utilized ($60M or so) is a pointless liability. This is why he's incentivizing people to divest, so that the bankroll reaches a more reasonable size - that is, one that is big enough to accomodate massive bets, but doesn't have a huge needless liability attached to securing it.

[devans]

We would need that 360 days average somewhere in the website.

Yes, basically this is forcing the bankroll to go back to something like 1000 BTC... I bet lots of investors won't even notice these changes and just leave their investment there, even if they may be paying a 100% fee. I wonder what percentage of the bankroll is composed of that kind of investors.

Even if gamblers are rarely targetting the max profit, seeing a much smaller one may make people less willing to gamble, as the max profit may be a factor in their strategies.

The last time the terms were updated I had planned to attempt to contact all investors that hadn't seen the announcement yet, but when I checked every investor without exception had visited the site at least once from the time of the announcement on the website to the changes coming into effect. If that's any indication bankroll investors tend to keep tabs on their bankroll stake fairly well.

I would propose Devans to:

1. Use a formula just based on USD. If wagered is really stable in USD terms, this seems reasonable. And USD is stable enough that there shouldn't be any need to use that strange basket. The website should still show that 360 days average somewhere and explain which exchange is it taking into account for the calculations.

The US dollar isn't relevant to most of our players. And while it is perceived as largely stable, I'd rather err on the side of caution and ensure the formula stays relevant regardless of any individual currency we choose as a proxy. I am confident that this way the commission structure will at most require tweaking every few years.

I agree with you on making the effects on the commission rate more obvious and showing more data. bustabit will soon start showing the current commission rate on the web site as well as provide historical data for the exchange rates we use, the bankroll size and the wager volume.

2. Don't drop the "target maximum bankroll" so much at once. Try dropping it gradually and see how players react. If wagered/day stays stable, you could consider lowering that target bankroll size. Dropping it by so much may have unwanted consequences for players and is very confusing and negative for current investors and makes them have less confidence in the project, as you may choose to do some other drastic and negative changes in the future. This is even more relevant when divesting and investing has a cost (dilution fee).

Consider that the size of the bets bustabit needs to service are stable in purchasing power rather than in Bitcoin and that targeting a bankroll size in Bitcoin doesn't really make sense for that reason. From bustabit's perspective the target size for the bankroll hasn't decreased at all–if anything it has slightly increased over the past few years. What has changed is that the bankroll went from being worth a reasonable-ish $67m half a year ago to an insane and frankly unnecessary $155m today.

The bankroll was less than half of what it is now for most of bustabit's history–even since v2 launched–so fear that players will be unable to bet like they are used to isn't warranted in my opinion. For the majority of players it doesn't matter whether they can win the equivalent of $1,500,000 or "only" $500,000 in a single round.

[devans]

I fall in this bracket you mention. The way i understand it (and i maybe wrong), is that bustabit is pegging the currency to XDR which is apparently a bunch of FIAT currencies rolled into one!?

So will i get paid in XDR, or will that XDR be converted to the prevailing BTC rate at the time of dilution, and i get the corresponding BTC amount?

Sorry but i am quite confused with this change. I will let it ride for now and see how it pans out over a month or two.

The only thing that is changing is how the commission that bankroll investors pay to bustabit is calculated. At the moment the commission rate changes based on the bankroll's size in Bitcoin. In March the commission rate will change based on the bankroll's size in XDR (a basket of fiat currencies) instead. The bankroll and its profits/losses will continue to be held in Bitcoin and won't be converted to any other currencies.

[Timetwister]

In that "stats" page you could also have wagered amount per day in XDR, as Just Dice does.

[🏰 TradeFortress 🏰]

Speaking as a small BaB investor here.

Devans, could you please cap the commission to a max of ~95%?

It wouldn’t be good if investing in the bankroll ever turned into a -EV proposition. I don’t think that’s what any investor signed up for, and the reality of the 2% nonrefundable investment fee means that new investors, and re-investors, must make long term considerations when they invest.

Furthermore, while I do have strong trust in you, a commission structure like this technically isn’t “provably fair” in in spirit, as the commission is paid to _you_, and nothing stops _you_ from investing. So let’s say it gets to a point where you own 55M XDR of Bitcoin. You could deposit it, force the commission rate to be >100%, and make _every other investor have negative EV_.

I think capping the max commission to 95% will achieve what you want, but also provide certainty to investors that they will always still be investors and won’t face the possibility of entering into a -EV trade.

[fullhdpixel]

The intention behind the dynamic commission rate introduced just a few months ago was to reduce the size of the bankroll to a more reasonable one and to find an appropriate commission rate. Today, however, the bankroll is larger than ever. The change clearly isn't fulfilling its purpose, so I am adjusting the formula. At the bankroll's current size of nearly $150m this represents a significant increase in the commission rate, which I hope will move investors to realize some of their profits and divest from the bankroll.

Honestly I have never seen someone be tired of getting too much investment before, this is both a blessing and a curse I assume. Sure, it is really bad that we have 150+ million dollars worth of bankroll when all we need is 50 million, that would put it into a place where earners would earn more from the same bet, all 150+ million dollar investors take the share of a guy who lost 10 bucks, it would all be covered in 50 million and less people would get more money so I get it.

However you have to also see the fact that you could have been a website that rarely gets investors and you might have to end up filling the bankroll yourself just so you could cover gamblers who are rare and barely anyone gamböles, basically your website could have been something nobody liked and only under 10 people came in and gambled very little and left type of place, instead your "problem" is that too many people invests into it and I think that is a great problem to have.

[StackGambler]

Thank you bustabit, for being the only consistent casino that doesn't constantly try to fuck people over in some way. Even Stake has reached some pretty shit levels. Daniel is always a class act. I will forever recommend this god damn site no matter how much money I've lost on it.

[malevolent]

Ufff, that change to Bankroll will def. make people divest...
Whats the point of it though?
Does devans make more profit if the Bankroll is smaller?

All the increases in commissions were clearly aimed at lowering the bankroll size to minimize liability, not to maximize profit.

Since the rise in price has been rapid, not enough time may have passed to be able to tell how investors will react; especially long-term ones since the divesting fees will always discourage short-term ones. I think it would have made sense to wait >6 months before making another change to commissions.

[micky123]

I fall in this bracket you mention. The way i understand it (and i maybe wrong), is that bustabit is pegging the currency to XDR which is apparently a bunch of FIAT currencies rolled into one!?

So will i get paid in XDR, or will that XDR be converted to the prevailing BTC rate at the time of dilution, and i get the corresponding BTC amount?

Sorry but i am quite confused with this change. I will let it ride for now and see how it pans out over a month or two.

The only thing that is changing is how the commission that bankroll investors pay to bustabit is calculated. At the moment the commission rate changes based on the bankroll's size in Bitcoin. In March the commission rate will change based on the bankroll's size in XDR (a basket of fiat currencies) instead. The bankroll and its profits/losses will continue to be held in Bitcoin and won't be converted to any other currencies.

Gotcha, thanks for clearing that up. I will continue to hold my small investment in bustabit. Thanks for responding.

[dezoel]

Basically it is a way of saying "you guys are investing useless amount of money that we do not need and we want you to take your investment to somewhere else". I can't really blame them, if 50 million dollars would do the same trick and we are at 150 million dollars that is really useless amount of excess money that shouldn't be there, and it drops the profit chances of people who would otherwise make 3x more money if it was 50 million dollars.

However I also feel like it should be a bit about free market, if people are willing to make less profits with investing more than needed, they should have that chance, and by increasing the commissions a lot devans is basically trying to prevent that from happening. I do not really see problem with both approaches, we could have 50 million and people who stay could make more profit, or we could have 150 million and people will be left to do whatever they want, both looks fine to me honestly.

[trepxtz]

Speaking as a small BaB investor here.

Devans, could you please cap the commission to a max of ~95%?

It wouldn’t be good if investing in the bankroll ever turned into a -EV proposition.

I haven't looked into the changes too closely yet, but I second this. Devans, please do not allow the possibility of investors to have -EV; that would be reprehensible.

[devans]

Speaking as a small BaB investor here.

Devans, could you please cap the commission to a max of ~95%?

It wouldn’t be good if investing in the bankroll ever turned into a -EV proposition. I don’t think that’s what any investor signed up for, and the reality of the 2% nonrefundable investment fee means that new investors, and re-investors, must make long term considerations when they invest.

Furthermore, while I do have strong trust in you, a commission structure like this technically isn’t “provably fair” in in spirit, as the commission is paid to _you_, and nothing stops _you_ from investing. So let’s say it gets to a point where you own 55M XDR of Bitcoin. You could deposit it, force the commission rate to be >100%, and make _every other investor have negative EV_.

I think capping the max commission to 95% will achieve what you want, but also provide certainty to investors that they will always still be investors and won’t face the possibility of entering into a -EV trade.

I haven't looked into the changes too closely yet, but I second this. Devans, please do not allow the possibility of investors to have -EV; that would be reprehensible.

It is not possible for bankroll investors' EV to become negative. Assuming the commission rate never reaches 100%–and economics says it can't–both the bankroll's expected value and its expected growth will always be positive. And even in the case of a 100% commission rate the expected value and expected growth merely become neutral, not negative.

Worrying about that really isn't necessary, though. People invest in the bankroll to earn a profit. If they don't expect the bankroll to earn a profit then they won't invest in or remain invested in it. That holds true even if the dilution fee might lead someone that only invested recently to hold on and tolerate low yields a little longer than others in the hopes of others divesting first.

As a side note, as of a few days ago all bankroll investors have seen the announcement.

[JollyGood]

@devans

In a nutshell in the long run how do these changes benefit bankroll investors?

If for example somebody invested 1 BTC on 2nd February 2109 how much profit would be projected by 2nd February 2020?

In the same respect if someone invested 1 BTC on 2nd February 2021 how much profit would be projected by 2nd February 2022?

Is that a good example to get an idea about how the changes will affect investors and payouts?

[Timetwister]

@devans

In a nutshell in the long run how do these changes benefit bankroll investors?

If for example somebody invested 1 BTC on 2nd February 2109 how much profit would be projected by 2nd February 2020?

In the same respect if someone invested 1 BTC on 2nd February 2021 how much profit would be projected by 2nd February 2022?

Is that a good example to get an idea about how the changes will affect investors and payouts?

Benefit? How could that benefit investors? This is essentially dropping expected returns substantially unless there's a massive divestment.

[TheGreatPython]

It is not possible for bankroll investors' EV to become negative. Assuming the commission rate never reaches 100%–and economics says it can't–both the bankroll's expected value and its expected growth will always be positive. And even in the case of a 100% commission rate the expected value and expected growth merely become neutral, not negative.

Worrying about that really isn't necessary, though. People invest in the bankroll to earn a profit. If they don't expect the bankroll to earn a profit then they won't invest in or remain invested in it. That holds true even if the dilution fee might lead someone that only invested recently to hold on and tolerate low yields a little longer than others in the hopes of others divesting first.

Even though that first part is true (why would anyone want invest into something they think they will not be making any profit) the second part is very much true and a bit of a problem. The part about where the new investors would have to wait a lot just to break even, I don't know how long it would take because it depends on the gamblers and how much they wager and how much they wager and we all know there are volatile periods, so it could be investing and profiting in 10 minutes or not profiting for 10+ days both are quite possible depending on the luck of the gamblers.

But the fact that you invest and start with a negative is a bit of a problem and having it go higher and higher makes it even harder and harder to make a profit. I would have to say something dynamic like "the more you keep your money in" type of solution could be better if you ask me.

[SquallLeonhart]

I do agree with investors who think this is unfair but I can't help but agree with Devans who has to do "something" about this situation. For all the people who are complaining about the changes, let's assume you take control of the situation, 50 million dollars worth of investment is more than enough, there is no need for more money, but there is 150+ million dollars invested, which makes people earn a lot less and all those extra money that was invested not only doesn't help but also hurts on top of it, so you have to figure out a way to drop that 150 million dollars invested into 50 million dollars in order to help people out better and make the investment a better option. How would you do it? I mean short of literally closing the bankroll and investment and just waiting until everyone gets out until 50 million left, there is really no other choice but what Devans is doing.