Edit: Why the downvotes? I'm curious if they got an opinion from a lawyer on the legality of their site.
(IANAL)
That said, given the fact that there were a total of 14 bettors in the first two rounds, this sounds like the smallest of small fry when it comes to the world of online gambling.
Online poker is grey-area because the poker outfit itself is generally outside the scope of US law. If it were more legal, you can be sure their servers would be hosted domestically in the US where it's cheaper and faster.
Your local bookie, however, is in the same scope as a guy running a local card room -he's taking a cut off of people's gambling habit. Whether it's sports or not, it's still going to be bookmaking, and still trouble. Extra trouble if it's over state lines.
Not in the US and probably any other county unless he has a license.
As we get more volume, then we can do stuff like this and let the market dictate things like "Prediction Target" or "BTCUSD Strike Price".
[1] Call options[2] give you the right, but not obligation, to sell an asset at a given price, so if the strike price of the option is the price you don't want the BTC to go below, and the price of BTC does go below that value, you eliminate your downside risk because somebody has already agreeed with you to buy at that price - and you have to pay for that agreement up front.
[2] Options ~= Insurance, where ~= means 'pretty much equals'
1,648,531 GH/s is the current target. I can bet below or above that. It maybe sound odd, because I am not really into the Bitcoins, but what (in the very uncertain case) if the target is hit (neither below or above)?
But in all seriousness, if that does happen, we'll refund all the bets without taking any house fees.
Anyway, cool site, great idea and thx for the links above!
https://blockexplorer.com/q/getdifficulty shows current difficulty at 189281249.28103
This is the API endpoint we're polling is https://blockchain.info/q/hashrate
Hash Rate is an inferred number though. See http://bitcoin.stackexchange.com/questions/11139/how-is-the-...
Isn't that a little high?
> House Fees: To encourage betting early, house fees begin at 0% of your bet and increases linearly to 20% when the betting round closes.
Parimutuel betting, not sure - but there is always a house fee - that's how the house makes money.
A traditional bookie would have at least 5 to 10 % built into his odds as well (like if you were betting on even odds, liek a coin toss, it would be bet $110 to win $100 for either side (so the bookie has a 5% hold if he can keep the betting balanced, no matter who wins)
etc etc.
More importantly, if you have that much Gigahashing power, it's not worth manipulating this. You're better off sticking to mining Bitcoins.
This means you are not guarranteed betting X pays out Y. And this does change as bets are made on either side. And so one may think, why not just bet the last minute? House fees are initially 0% at 6 AM (PDT) but roll up linearly to 20% by 6 PM (PDT). This is to encourage betting early and discourage bet sniping at the last minute. [2]
Having said that, we do plan to move towards a floating model, more similar to the futures market as we gain transaction volume.
Current prediction targets are set by us. And bettor bet on either sides. As we gain liquidity and transaction volumes are increased, we plan to then turn this into a real time exchange so that the transactions are settled real time and we essentially have a moving prediction target.
In fact, this how we got our name at future representing futures market and block representing bit coin. :p
[1]: http://en.wikipedia.org/wiki/Parimutuel_betting [2]: http://www.futureblock.com/how-it-works [3]: http://en.wikipedia.org/wiki/Futures_exchange
Bet above: 2.2284 BTC
Bet below: 1.0903 BTC
Edit - I'm an idiot, and forgot I'd have to bet twice.
Without revealing anything specific, we have a number of trigger conditions and any bet size over or under the limit is a trigger condition. That marks the bet as invalid and manual admin action is then required to refund the bet.
If you can't tell exactly what you're betting on on the front page, you shouldn't expect people to bet on it!
That's exactly what we want to eventually do. For an efficient market to run, there needs to be a way to manage risk.
However, if you mention "derivatives" to any normal BTC user, the mostly response of "huh?", or "aren't those the things that made the world collapse in 2008?".
Future Block, as it currently stands, is an entertainment site to bet on something novel. However, our hope is that:
1. It serves as an education tool to introduce people to derivatives, because derivatives are essentially about taking one position or the other.
2. To build liquidity for a derivatives exchange. Parimutuel applications are great for this because you don't have the 'chicken & egg' problem where you need 2 types of customers for it to work.
Hope that answers your question!
I'm not sure there's any way to be sure the house is really paying out the entire pot -- let alone to be sure the house isn't intentionally manipulation the actual market itself!
1. Blockchain.info is relatively trustworthy.
2. However, we have our own hash rate calculations by directly interfacing with the actual blockchain. This isn't in production yet. This is because hash rate is always going to be a guestimate. Depending on the time intervals that you pick, the guestimates vary. So we asked overselves, what helps us to maximise transparency. So we decided to go with blockchain.info's hash rate because everyone can check that.
This is cool: "Our long term goal is to build an open derivative platform that anyone can participate in. "
Not that I don't trust you guys. Is there a way that I can test the site?
Well the nature of Bitcoin is that all transaction are anonymous but transparent at the same time. For example, you could check out all the bets we've received and payouts we've made. e.g. http://blockchain.info/address/1DXa2tKkoKiR1p7nbt2xSCFdUxzGd...
I'd encourage you to place a small 0.01 to 0.02 BTC bet just to test out the site, and see that it'll update the pool/odds dynamically.