For example, the dice site in question, just lost a bunch of profits. My share of the profits as an investor, I just lost half a bitcoin. All the while, the operator has been taking from the amount wagered. That's the thing about being in the same boat. Doesn't inspire confidence. Which is why, when I launch my own site, I probably won't be doing the same thing.
That's not really an argument. Just a childish mentality: "I broke my toy, but the other kids are playing with theirs... that's not fair!"
You know if he was using the "traditional system", you'd still loose your money, right? Operator losing together with investors 'inspires the confidence'? How?
If you launch your site under the traditional system, how long are you prepared to operate at loss? What happens when you run out of funds?
Even if the site is on profit, what will you do if big investor comes along making your portion of profits insignificant? How will you mitigate that risk?
The site or operator is not confident enough to bet on his own site, to either fund the bankroll, or to share in both profits and losses. I don't know if that is an argument or not, but we're certainly not talking of toys here. Fiat banks lend to business on the strength of their business plans. Take care of your toys so you don't break them. Or play with them knowing you will break them (such as for target practice? My kid has a new Iron Man toy, likes to fling it across the room thinking it will survive.)
Most businesses are prepared to operate at a loss a minimum of 6 months, some even take 1 year or more. I'm talking about traditional brick and mortar businesses, not fly-by-night crypto businesses. Break even point or ROI for some fast moving consumer goods businesses that sell actual physical products in malls and department stores can take up to 2 to 3 years.
That's the mindset you should have when putting up a business. Admittedly, I see bitcoin based business such as game sites could probably make their capital investment and profits a lot more quickly than 2 to 3 years.
For any investor, I will only take 10% of profits. Small investors, then 10% of small investment profit. Big investor, then 10% of big investment profit.
No casino is going to give 1% or even 0.5% of turn over or wagered to their investors just because that is their declared house edge.
If the game were multi-player poker, and the house takes a 2.5% rake on every bet, win or lose, I think everyone understands that model. But we're talking about a game that is played against the house, not against another player. The house already has the edge.
Taking profits from investors when players win or loss does not inspire confidence in the house as far as the shareholders are concerned. This is gambling after all. Even the house gambles.
I agree though, that the house would have a more consistent income in the short term. It will never lose. It won't suffer variance.
Confidence = Are you willing to bet on it? If the answer is no, then you are not confident.
That may or may not factor in some other people's decisions. I am personally invested in that particular dice site, which is not an endorsement, I am talking the same risks as everyone else investing there as well.
You can also look at it another way, that the house is guaranteed to have income, therefore there is confidence that the site will make money. They are just not willing to bet on it.
