Topic: Bears, Put Your Money Where Your Mouth Is - page 5. (Read 7187 times)

If you're willing to trust me and mtgox, I can offer said service.  I am in Australia, so my USD account is empty.   There are others on these forums that offer escrow services as well.

well, in this case at least, it is quite simple, we agreed from the beginning to have the bet in USD. And use Bitcoin just for value transmitting properties.

For higher value bets we do need an escrow able to receive BTC and transfer it to USD, than keep the dollars safe until the end.
I think this is not a trivial problem.

I've been trying to work out how escrow would work in a multi-currency bet like this.  Escrow implies lack of trust that the parties will pay up honestly, of course.

Take a simple case of 50/50 odds.  Each bets BTC1/$100, as today's price is $100.

Bear target:$50
Time: 1 month

Both parties expect to double their money (n their respective currencies) if they win the bet.

If the bear wins, the bitcoin the bull deposited is only worth $50, so the bear will only get half his winnings.

If the bull wins, the US$ the bear deposited may buy less that BTC1.

If all bets are converted to US$ on initiation, the bear is covered, but the bull may lose even if he wins.  If all bets are converted to bitcoin on deposit, the bull is covered but the bear may lose even if he wins.

What  you really need here is a futures contract.  The bull needs a futures contract to sell BTC1 at today's price in 1 month.  The bear needs a futures contract to buy BTC1 at today's price in 1 month.  So what you really have is a future's contract between the two parties, each of whom doesn't trust the other will/can deliver.

Short of each participant depositing enough in escrow to cover a losing bet (bull to deposit US$100, bear to deposit BTC1), plus a margin to cover adverse exchange movements (say, an extra US$100 from the bear, and an extra BTC1 from the bull, at a minimum), I'm not sure how this would work.

Anyone else got any ideas?

Read thread please.

maybe because it's silly to agree to a bet in which your winnings are denominated in the currency whose exchange rate your bet is against.

We are in bear mode! Doesn't someone want to short!

Ignore

Confirmed. Expiration: 01:12:32 AM 4/21/2013 UTC.

what about the one touch bet ?

do you confirm? see up.

yes, that can be a solution but would put an additional burden on the escrow.

I'm still not understanding what you want. The escrow simply exchanges the BTC upon receiving it.

BTC (from me) + BTC (from you) -> Escrow -> Exchange -> $$$ to escrow -> Time goes by, winner wins the money -> Exchange -> BTC to escrow (we've been hedged out of BTC so no risk to you) -> BTC to winner.

com'on

no escrow for now.

About the one touch bet:

current price 128.5

strike price (anytime within the next 24 hours)

128.5*0.87=111.795

Bet for 100 USD!

IF we use an escrow we should deposit the money at the beginning of the bet. And if the price of BTC is down you won't have enough to pay in USD.
 That's why I asked for an initial bigger collateral in BTC from the bull.

If we don't use an escrow... then we don't. We have to trust each other in USD, and in extreme cases I think there would be some problems. Like BTC very high I could default or very low you could.

I'm not understanding the problem. You just exchange the coins upon their being received.

Also, being a bear (at least for now) I like USD so the problem comes when we end the bet, and the bear wins.
You need to provide a bigger collateral than the initial BTC deposit. Just imagine if BTC is down to 50$.
If the BULL wins then my collateral is more than enough to pay for your wins.

I think we should set some predefined limits if we need to end the bet in advance.

Okay this is better.

This is legit. If you can find an escrow I trust, I'll go for it. Note I will not use betsofbitco.in because they trolled me in the past. Or you could just trust me. Either way, I'm in.

EDIT: I'm actually going to put that in OP, its a good form of standardized odds.

DERPED SEE NEXT REPLY!

Better and more elegant:

What if the odds are exactly current price/100 : 1 for the down bet to be less than 100 at the end of May (right now, apparently more safer for you)

and 1: 150/current price for the down bet to be less than 150 at the end of May (for now, more safer for me)

What do you say?

We need an escrow.
I may want to bet more than 1$.