Can you explain to me how it is possible to decrease the house edge overall by using such a strategy?
Because in most casino games the edge is based on what you wager. This means your expect loss is purely based on what you wager (most dice sites, its 1% of wagered amount). But they allow you to configure your payout, and offer the same house edge on all payouts, so you can easily take advantage of this by minimizing the amount you wager.
Dooglus and Blockage provide very advanced betting sequences to minimize this a huge amount, but you can reason about it much easier if you imagine a simple 2-bet sequence:
Bet 0.5 at 3x .... if you win, stop. You won the 1 BTC! Otherwise bet the other 0.5 at 4x. Now you either lost your entire bitcoin, or won an entire bitcoin. However, in some cases you only wagered 0.5 BTC (and stopped early), so the "average wagered" is much less than 1 BTC. In fact, it should be about 0.835 BTC. Which means instead of an expected loss of 0.01 BTC, it is now only 0.00835.
And that, children, is how we lower the house edge on a fixed edge game.
As an interesting side note, Money Pot house edge works very differently and is far more fair to people who don't use advanced maths and bots to fragment their bets. (Where it's proportional to how much you are attempting to win, as opposed to how much you wager)