Bets of Bitcoin - Bitcoin betting on real world events

[dacoinminster]

* We are not using a fixed percentage, current value of in-server-balance is well below 50%. What is in the server can easily be replaced by our own funds. What percentage would make you feel safe?
* We don't have enough moderators for commenting right now. Do you know a nice free forum service, we can build a community in? In the meantime you can post
* Interesting suggestion for commission structure. We thought that people would not be willing to pay commission from winning bets, but we might be wrong. Suggest it in the feedback box (right top corner of every page) and people can vote on it.
* Right now we require both a submission fee and a minimum bet. I think it is fair to ask for submission fee, because we spend time on every submission and it may not generate losing bets. Also we want to make sure that people will think of controversial statements that may attract 2BTC on both sides.
* Standings or bet history is also something I can not promise for soon. We want to make things as anonymous as possible. But feedback voting box is there for a reason.
* Use your best judgment for prohibited bets. Obviously we will not allow assassination statements, but we have no problem with betting on individual stock values. Our volume is not high enough to justify any insider trading yet.
* Arbitrage is something that would only make the market more efficient.
* As I said, for many things you can ask for community voting in our feedback box.

Bring on more suggestions. We love it.

50% is fine for now, but hopefully you will keep as few coins on the server as possible as you get bigger.

I put a bunch of feature requests on your suggestions page - everybody go vote for them!

[memvola]

* We are not using a fixed percentage, current value of in-server-balance is well below 50%. What is in the server can easily be replaced by our own funds. What percentage would make you feel safe?

What would make me feel safe would be if it's automated. In the MyBitcoin case, most of the funds were supposed to be offline, and I'm sure it was that way when that fact was stated, but they were probably too busy to do the maintenance, which is actually understandable.

My uninformed suggestion could be; for instance, balance that won't be needed for 5-10 days can be automatically transferred offline. Funds could be transferred manually back in if need be, which is a maintenance job that needs to be done every 5-10 days; but hey, accidentally falling behind a few payments is much better than being unable to pay at all...

[coinjedi]

What would make me feel safe would be if it's automated.

That's a fair request. Currently we are in control but we should setup a script soon.

[lemonginger]

Here are some of the comments I made to coinjedi in a PM

- The weighting algorithm is going to be too cumbersome for the average user. Every bet is essentially some combination of weighting plus the total amount of bets against you, so it is hard to know what odds you are getting at any given time.

- The opportunity costs of long bets are enormous. Even if I was sure BTC would be around a year from now and this site would be, locking up a bunch of money in a bet that can't be traded is a liquidity trap. Also, by storing bets in BTC you are also speculating not only on your bet, but on the long term movement of the currency.

- The reason intrade and similar sites work well is because it is intuitive and easy to understand and you know exactly what odds you are getting at any point in time. i.e.; because of the 1-100 all or nothing nature of the bests you can buy into a long term contract and expect to sell it when it goes up, even if you have no intention of waiting until the resolution of the contract. Secondly, the 1-100 numbering matches how we think of the likelihood of events happening in our heads (a 50% chance it is going to rain tomorrow, etc)

- The design is great, the typos all over the place are not so much.

In short, I would love a liquid predictions market, especially one that allows the creation of predictions and gives a percentage of profit to the creators of successful predictions (though this does encourage a little bit of predictions gaming where one is essentially getting better odds on ones own predictions than anyone else is) but I don't think this is it. The betting system is too opaque and the risks and opportunity costs of long term contracts, held in bit coins, that can't be traded, is too much.

Even if they could be traded, it would essentially be as complicated as trading things like long term derivatives in an options market rather than as straightforward as betting on than buying contracts that say an event will happen at say .76 BTC/contract and knowing that means the market currently thinks there is a 76% chance of this event occurring

[dacoinminster]

Here are some of the comments I made to coinjedi in a PM

- The weighting algorithm is going to be too cumbersome for the average user. Every bet is essentially some combination of waiting plus the total amount of bets against you, so it is hard to know what odds you are getting at any given time.

- The opportunity costs of long bets are enormous. Even if I was sure BTC would be around a year from now and bets of bit coin would be, locking up a bunch of money in a bet that can't be traded is a liquidity trap. Also, by storing bets in BTC you are also speculating not only on your bet, but on the long term movement of the currency.

- The reason intrade and similar sites work well is because it is intuitive and easy to understand and you know exactly what odds you are getting at any point in time. i.e.; because of the 1-100 all or nothing nature of the bests you can buy into a long term contract and expect to sell it when it goes up, even if you have no intention of waiting until the resolution of the contract. Secondly, the 1-100 numbering matches how we think of the likelihood of events happening in our heads (a 50% chance it is going to rain tomorrow, etc)

Very good points. I wouldn't personally put together a site like this because of the possibility that intrade will start accepting bitcoin deposits and withdrawals, killing any reason for people to use a bitcoin-only site.

I also prefer to be able to get into a position when the odds are attractive, and get out once the odds have approached what I think is fair, but I can live with this for now . . .

[lemonginger]

Very good points. I wouldn't personally put together a site like this because of the possibility that intrade will start accepting bitcoin deposits and withdrawals, killing any reason for people to use a bitcoin-only site.

I wouldn't hold your breath. I have gone back and forth with various InTrade CS people and all I ever get is essentially "we're thinking about it"

[coinjedi]

We have an ongoing bounty of 1BTC for the most successful submission of the week. Check it out.

[coinjedi]

Our hosting is down but we have backups. We should be up and running again soon. No worries.

[memvola]

Our hosting is down but we have backups. We should be up and running again soon. No worries.

When do you think the site will be up again?

[coinjedi]

We switched to a new hosting provider and set up the server. We are doing some final tests. Site should be back tomorrow. We will email all the users when the site is back.

[coinjedi]

We are back online! Enjoy!

http://betsofbitco.in/

[dacoinminster]

My experience has been smooth so far:

1. Sent some BTC in
2. Placed some bets
3. Decided not to start my own bet statements and bet on them, since it isn't free (hint hint)
4. Withdrew the remaining BTC rather than letting them sit on the site

I put a big bet against a government acknowledgement of extraterrestrials, which seems like a safe bet in terms of the bet statement itself, but could be considered risky considering the expiration at the end of 2012 and the "here today gone tomorrow" nature of bitcoin sites . . .

Thanks for making an awesome site!

[coinjedi]

Thanks dacoinminster for the review.

I want to personally assure the users that if we need to close the website for some unforeseeable reason, we will send back everyone whatever balance they have.

Also official statement from our previous service provider is that there is no security breach in our data center and our loss of service is due to some buggy virtualization software. Since then we changed our provider and increased our off-site backup frequency to every half hour.

[coinjedi]

We now have a Twitter account where you can follow latest statements.

https://twitter.com/#!/betsofbitcoin

[evoorhees]

I really like the site... nice look, simple and elegant. I've sent a coin to start gambling!

[coinjedi]

Welcome evoorhees! We like the word "predicting" over "gambling"

[dacoinminster]

Welcome evoorhees! We like the word "predicting" over "gambling"

Yes. I would never gamble (bet on something where the odds are against me), but prediction markets are fun. I already won my bet that gold wouldn't clear $2000/ounce by end of August.

[BitcoinBug]

I'd like to raise a question about this service: do we have any good reason to trust it?

Some quick facts:
- owner identity unknown
- it was registered with offshore 100% anonymous hosting (vindohosting.com)
- it is hosted at LeaseWeb currently (same as MyBitcoin)

I hate to be paranoid, but somebody has to be.

[memvola]

I'd like to raise a question about this service: do we have any good reason to trust it?

Some quick facts:
- owner identity unknown
- it was registered with offshore 100% anonymous hosting (vindohosting.com)
- it is hosted at LeaseWeb currently (same as MyBitcoin)

I hate to be paranoid, but somebody has to be.

These are all good questions. I trust it enough to bet on everything I have a vague idea about, but I suspect the service not being very active is somewhat related to trust. There are very long bets, which I think is a very good thing to have, but besides the reality of locking your money for a long time, it's currently impossible to judge if the system will be alive for that long. I hope we see improvements on that front, otherwise it will just be simple bets for simple amounts.

[coinjedi]

I'd like to raise a question about this service: do we have any good reason to trust it?

Some quick facts:
- owner identity unknown
- it was registered with offshore 100% anonymous hosting (vindohosting.com)
- it is hosted at LeaseWeb currently (same as MyBitcoin)

I hate to be paranoid, but somebody has to be.

These are all true.
We want to earn trust by being in business for years to come. I understand people being paranoid. We were actually frustrated when our competitor moonco.in has disappeared. Community needs responsible service providers more than anything.