Topic: [POLL] Just-Dice INVESTORS: Do you agree with lowering the max bet? - page 4. (Read 7216 times)

isn't that the whole reason why the site was made this way? So it could be left alone? Looks like emotions are sneaking in.

 

Dooglus, please explain how high the risk is to go bust when 1% max bet?

From the simulations done the worst case scenario was losing 80% of bankroll.

Never did it happen that the bankroll went bust and in the end the whale always lost everything.

How high are the chances for this to happen, if any?

In my book Nakowa just demonstrated he is up 13k, which is unlikely but very possible. And today he lost aprox. 3k.

Then, I'm assuming you calculated the "ruin risk" before taking such a decision: could you share with us what is the precise probability of Nakowa ruining the Casino, considering 1% max profit and a 23k roll for the Whale?

My "guesstimate" is that it's totally negligible.

Secondly, you speak about 1% max profit investors are "keeping the faith". In what?

In the site NOT being rigged, or in math and probability?

I've absolute faith in you, and therefore on the site. And you simply do not "have faith" in math and probability.

Setting your own risk % would be great! I can't wait for that to be implemented

That would have to be the most brilliant long-con of all time, but I doubt it.  I also don't understand the logic of pushing away the largest gambler as long as your bet limits are within kelly criterion.  Dooglus understands math, so my only explanation is that mechs caught him at an emotional time and convinced him to make a poor and emotional decision.


EDIT:  The poll currently shows that nearly 70% disagree with lowering the max bet.

I think dooglus did an excellent choice and was brave enough to make it on time.

Now we are having this discussion but consider a parallel universe where this afternoon nakowa was max betting 300 euros and the bankroll was down to 20K. Then we would not see "paladins of the kelly criterion", "defender of the justice of the never changing website" or the people who "disagree on lowering the max bet". We would see a mob of angry people who would claim the website is scam, nakowa is dooglus and that the bitcoins were just stolen. Dooglus would be in quite much trouble NO MATTER HOW MUCH MATH HE COULD EXPLAIN.

No one could foresee the whale betting 13M and dooglus made the wise choice of lowering the variance, at least for the sake of proving that nakowa is not cheating us.

If I were him I would have 0.001% max bet, I felt we still risked a bit this afternoon :-)

Are you saying that he does have a system that works? Have you checked your random number generator (maybe it's being run in a VM, which are notorious for not providing enough enthropy to the OS?)? It just seems extreme that the administrator of a gambling site is afraid of one gambler causing him ruin, and that that one user apparently does so consistently?

Dooglus, thanks for your (as always) level-headed and professional response.  Emotions are certainly running high.  

Would you consider raising the max bet to 0.50% as a compromise? It might allow Nakowa to come back, and give the 30,000BTC investors a chance to recover their losses.  I assume it will take you weeks or months to roll out the custom-risk feature and Nakowa will probably be long gone by then.

Also, would you consider that it would be good idea to warn gamblers ahead of time before making big changes like the max bet?

EDIT: Rumor has it that Balotelli was in the middle of a martingale strategy when the max bet was changed and ruined his play. To set a precedent like that is terrible for the site from a gamblers confidence perspective and very bad from a professionalism point of view to do it without warning.

I don't think that's true.  It applies even when you're faced with the opportunity of a single +EV bet, and tells you how much you should risk on it.

Investing less money doesn't change the risk of ruin (ie. of the site going bust).  Whatever you invested, you were risking 1% of it per roll.

I have temporarily set the max profit to 0.25% because with it at 1% nakowa was able to take huge chunks of the bankroll over and over, as he has demonstrated time and time again.  To make matters worse, each time he takes a chunk of the bankroll, more investors lose faith and divest, resulting in the bankroll shrinking even faster.

Risking 1% of the bankroll per bet turned out to incur a much greater risk of ruin than I had anticipated, and so I made the change to 0.25% in an attempt to prevent ongoing huge losses.  At no point was it intended to be "the solution"; it's a stopgap fix until I can put something better in place.  I need to seriously reconsider allowing investors to somehow set their own risk level.  If some want to risk 0.25% per bet and others want to risk 1% then I don't see why I shouldn't let them.

If nakowa continues to win, the 1% people risk going bust, while the 0.25% people gain an ever increasing share of the remaining bankroll.  Eventually all remaining investors (the cautious ones) will be risking 0.25% and we'll be back where we are now, and the 1% investors will have had the chance they're asking for - risk big to win big.

If nakowa does blow up one day, the 1% people get the lion's share of his losses, which they will deserve for 'keeping the faith'.

Of course, maybe he'll never return whatever happens; who can say?  I know he has said many times before that he has quit.

Wait, let me get this straight.

People develop bitcoin gaming website, including all of the logic behind it;

Users comes along and play at site;

One user in particular does a lot of business on the site. I'd assume that the site didn't have any programming errors, so that generally while some months he won, others he lost.

User upped the stakes (within the parameters set up by the site), and happened to win big (against very high odds).

That seems to be expected; if the site couldn't withstand that sort of potential loss, it shouldn't have offered that sort of bet in the first place. But it accepted that bet and lost; he doesn't have the "investors" money, he has the money he won fair and square. And after taking that sort of loss, unless continuing to offer those stakes is unfeasible, the last thing you want to do chase him away from the site altogether, followed by not lowering the amount he can bet. If anything, you should have given him an even longer shot to bet at, in order to hasten the recouping of your losses.

can't really believe this, though... was site just paying out all it's income without regard for maintaining a reserve so that it could withstand an occassional loss of this size? Because if anything, this should have been a GREAT advertisement for the site (people WANT to know that it's possible to win, and possible to win big time); Just seems like this none of this should even be up for discussion, just a standard risk of doing business (again, if the site offered that sort of bet, the fact that someone actually won it shouldn't be a surprise; even the longest of long shots happen given enough time. Sometimes it'll happen on the first interation othertimes, it'll wait until the billionth.

0.25% is way too nitty.  It was also really bad form to do it to single out the best customer of all time.

0.5% I think makes the house virtually bankrupt proof yet exposes everything to decent levels of risk.  I'd almost be in favor of lowering house edge to 0.9% with a 0.5% max bet.  I'm saying this all as an investor.

Well, you actually destroyed any short-term profit expectation for those of us who actually understand a bit of math and gambler's psychology, and also understood what kind of investment JD was, and therefore DID NOT DIVEST during the huge negative variance caused by Nakowa. You scared our best customer away by lowering the max bet he loves while he was playing, now we are roughly 30% down, and it will probably take many months to just reach b/e.

Man, do you realize that guy loves to make 300BTC bets? And he thinks he actually has a system that beats the house edge? And he says he is not a gambler and he just kept coming back? What would you think that guy would have done when he started to lose big? I'll tell you: he would have lost more, faster (just look how fast he lost the last 1,000BTC he sent to the site today, compared to the first 1,820BTC). That's basic human psychology at work. Nakowa is the prototypical gambler, he has EXTREMELY DEEP POCKETS, and you scared him away just because there was a minuscule chance that he could have won the whole roll?

Anyhow, anyone better than me at math could calculate what was the exact probability of him winning the whole bankroll, considering that:

• he has aprox 23K BTC
• house bankroll was aprox. 30k BTC at that moment
• house edge is 1%
• max profit is 1% of house bankroll

Mechs, I saw you in the chat: while we were all commenting how "percentage/nakowa" was gambling, you were whining. "I don't want to see this", "i feel bad", "i know how this story ends, he always starts losing big and then he goes up +6k btc", blah blah blah (I quoted you very loosely but you know that's the spirit of what you were saying). Shortly after Doog lowered the max profit.

You know what? You were just crapping your pants, you were overemotional and you didn't act rationally, triggering a -EV decision (lowering max profit, pissing off the whale). "i know how this story ends"? YES, YOU SHOULD HAVE KNOWN. MATHS HAVE NO FEELINGS. THE STORY ENDS NAKOWA ENDS UP LOSING EVERYTHING IF YOU LET HIM PLAY LONG ENOUGH. Unless you crap your pants and scare him...

...At the expense of other investors who are down and won't be able to recover their losses because Nakowa won't play anymore.  Because of you.

You've fucked a lot of people out of your own selfishness and greed.

The 30,000BTC investors should have been given a fair chance to win back their losses from Nakowa.  They have been fraudulently robbed of that possibility without any warning.

Once again, I have an opinion but I am not a deicison make.  And yes, I want to make profit just as the players do.

mechs, do you even realize why most people here are disagreeing with you?

Because they understand math.  They know that 1% is the most profitable bet size.  

For someone who claims to think 'long-term' you would know that mathematically nakowa would lose all his bankroll if we allowed him to keep playing. So, you obviously don't think 'long-term', or you're not intelligent enough to understand kelly criterion or mathematica. You think short term because you are a greedy investor who wants the bet size dropped at the expense of other investors who are down and will never be able to recover their losses.

I'll say it again.  You're basically just greedy and selfish and only thinking about yourself. You want all the reward without the risk at the expense of other investors who now will never recoup their losses.   

You are implying that each time he "walks away" the "luck clock" resets? That's the fallacy. He might stop to eat/sleep/whatever, but from a mathematical point of view he is not stopping. It doesn't matter the house cannot "initiate bets", Nakowa is initiating bets non-stop. In mathematical terms, he never "walks away", he never "stops" until he quits playing for good and never plays again. Do you understand that?

As the very same dooglus wrote:


TL;DR: he just needs to keep playing as he is playing right now, and he will end up losing it all. End-of-the-story. There's no way of "beating the edge" with large enough numbers. You want him in your casino, you NEED him on your casino....

Well, the 1300BTC issue was ludicrous at best, good it was solved well by Dooglus. But the fact he is a liar and that he keeps saying he will never come back, while he keeps coming back, is in fact GOOD for you - don't you see?. Do not you realize that he has all the traits of a degenerate gambler that will end up losing EVERYTHING?

TL;DR: Unless he is cheating (and there's no evidence whatsoever on that), you want him in your casino. Precisely because of how he plays, precisely because of how he is.

The point is that he doesn't have to play long enough to lose.  He's demonstrated over and over again that his bankroll is big enough that he can let variance take him into positive territory, and walk away.

The Kelly Criterion applies to situations where the player with the edge can keep betting as long as he likes.  With JD, the house has the edge, but can't initiate bets.