Commercial Provision of Zero House-Edge Gambling Products

Gaming Law ReviewVol. 26, No. 9 ArticlesFree AccessCommercial Provision of Zero House-Edge Gambling ProductsPhilip W. S. Newall and Maira AndradePhilip NewallPhilip W.S. is a Lecturer at the School Psychological Science, University Bristol, UKSearch for more papers by this author AndradeMaira Andrade Research Intern Psychology, East London, authorPublished Online:3 Nov 2022https://doi.org/10.1089/glr2.2022.0035AboutSectionsPDF/EPUB Permissions & CitationsPermissionsDownload CitationsTrack CitationsAdd to favorites Back To Publication ShareShare onFacebookTwitterLinked InRedditEmail In commercial gambling, odds winning are against gambler. Roulette good game demonstrate principle with. A roulette wheel has numbers from 1–36 that can land on, successful stake £1 on one these will pay-off £36 (including return stake). However, European an extra number, zero, which also (and be bet on). This means any specific number only win 1 in 37 times average, resulting average loss 2.7% all money staked. gambler known as house edge.1 American second zero (the double zero), but payoffs same. These further reduced translate into higher edge 5.3%, making less attractive gambling product.2This shows how compared across products,3 along with total amount bet, predicts gamblers' losses.4 Since losses lead harm,5 some economists have proposed house-edge games theoretical harm reduction approach.6 But not just possibility, least three significant online operators either provided or promised provide games. article reviews brief history games, while proposing alternative model they could commercially provided.Betfair innovative operator, having introduced first popular sports betting exchange, where bettors trade another like financial markets, Betfair taking commission market maker.7 As trades do risks maker, able charge lower commissions (its equivalent edge) than comparable operators.8 offered unique casino its “zero lounge.”9 For example, roulette,” gamblers had no all, – 36. Given same pay-offs other was therefore all.10Betfair we know, operator offering gamblers. While sometimes offer bonuses long-term profits (effectively negative edge), limited both time wagered.11 It possible attract sign-up use sport exchange.Betfair lounge, specifically baccarat, blackjack, video poker.12 differed play “optimal strategy,” i.e., knowing exactly when stick twist blackjack,13 order obtain house-edge. most might well still lost them slightly fairer versions their standard counterparts. was, however, due lack skill game, fair sense played closed lounge 2013, effectively deciding steer customers toward conventional house-edges.14 would few years until again online.The last two were based cryptocurrencies. Cryptocurrencies decentralized digital tokens volatile prices, bought sold 24-hours day online.15 Many people engaged investing active trading cryptocurrencies way money.16 Others attempted profit inventing new If cryptocurrency solves particular “use case,”17 such providing users additional privacy, then value should increase, allowing cryptocurrency's inventors selling newly generated assets profit. The provision trustworthy, low-cost, anonymous amongst potential cases.18 short cryptocurrency-based moved possibility,19 simplified games,20 generation range rival operators.21At prominent been developed around idea Edgeless 2017,22 ZeroEdge 2018.23 projects premise They aimed make gamble underlying invented projects. popular, many buy gamble, pushing up price, indirect profit-making model. neither models succeeded.The debuted $0.02, within year increased $2.93, large early adopters.24 price began drop August 2019, since stayed below debut $0.02. Effectively, hoping benefit likely hurt associated holdings. outcomes even worse anyone who cryptocurrency. CEO turned out using false identity, details website deleted initial offering.25 Buyers money, corresponding estimated between $4 $7 million.26 Although someday used genuine gamblers, example succeeded.Taken overall, does look product gamblers,27 offerings simply shifted risk aspect product. believe need always case, commercialized via model, lottery-based savings.Many countries experimented savings,28 UK perhaps longest introducing element randomness debt offerings,29 currently reflected called “premium bonds.”30 Premium bonds, instead fixed interest rate, chance prizes ranging £25 million. bonds cashed-in deposited, meaning loss, roughly rates savings providers. Lottery-based potentially encourage avoid products,31 actually effective house-edge, given pose loss. providers deal products as, providers, profitability rests higher-return opportunities.Yet, transformed product, lottery. there reason why basic approach vehicle better pattern adapted products. say would, unlike savings, require it Such delivered (as cost-effective land-based gambling), cost limiting penalizing withdrawals. conceivably gains deposits safe net-zero returns paid-out realize welfare games.321 Philip et al., Statistical Risk Warnings Gambling, Behav. Pub. Pol'y (2020).2 Nigel E. Turner Jing Shi, Relationship Between Game Volatility, House Edge Prize Structure Of Games What Tells Us About Design, 22 Int'l J. Computer Res. 107–131 (2015).3 Richard Woolley Edge: Hold Percentage Cost EGM 13 International Studies 388–402 (2013); Kevin A. Harrigan Mike Dixon, Government Sanctioned “Tight” “Loose” Slot Machines: How Having Multiple Versions Same Machine May Impact Problem 26 Stud. 159–174 (2010).4 Michael Auer, Andreas Schneeberger Mark D. Griffiths, Theoretical Loss Intensity: Simulation Study, 16 Review Economics 269–273 (2012).5 Matthew Browne Rockloff, Measuring Harm Estimating Its Distribution Population, inHarm problem gambling: public health approach. Routledge 14–22 (Henrietta Bowden-Jones al. eds., 2019).6 David Rowell Dorte Gyrd-Hansen, Could Pigouvian Subsidy Mitigate Poker Externalities, Australia?, 33 Econ. Papers 327–338 (2014).7 C. Williams Steve Seteroff, Betfair: Case Study U.S. Internet Market, L. Rev. 41–49 (2009).8 Davies Et Al., Betfair.Com: Five Technology Forces Revolutionize Worldwide Wagering, 23 Eur. Mgmt. 533–541 (2005).9 Lorien Pilling Warwick Bartlett, Industry, inRoutledge Handbook 66–78 (Robert Williams, Robert Wood, Jonathan Parke 2012), https://www.taylorfrancis.com/chapters/edit/10.4324/9780203814574-11/internet-gambling-industry-lorien-pilling-warwick-bartlett (last visited Jul 4, 2022).10 Alex Gowar Jack Houghton, Winning Dummies (2011).11 James Banks, Edging Your Bets: Advantage Play, Crime Victimisation, Crime, Media, Culture 171–187 (2013).12 OnlineGamblingWebsites.com, Was Betfair's Lounge? Fair Fight Savvy Player House, (2021), https://web.archive.org/web/20210411154341/https://www.onlinegamblingwebsites.com/blog/betfair-zero-lounge/ 2022).13 Edward O. Thorp, Beat Dealer (1966).14 supra note 12.15 Lee Kuo Chuen David, Li Guo Yu Wang, Cryptocurrency: New Investment Opportunity?, 20 JAI 16–40 (2017).16 Devin Mills Lia Nower, Preliminary Findings Cryptocurrency Trading Among Regular Gamblers: Gambling?, 92 Addictive 136–140 (2019); Paul Delfabbro Trading, 122 (2021).17 Guo, 15.18 Edge, Explained | Is Really Better Bitcoin Casinos?, casinosblockchain.io, https://web.archive.org/web/20210728221205/https://casinosblockchain.io/house-edge-casinos/ 25, 2022).19 Sally M. Gainsbury Blaszczynski, Blockchain Online 21 482–492 (2017).20 Oliver Scholten Ethereum Crypto-Games: Mechanics, Prevalence, Similarities, inProceedings Annual Symposium Computer-Human Interaction Play 379–389 (2019), https://dl.acm.org/doi/10.1145/3311350.3347178 27, 2022).21 Safer Consumer Protection Failings Amongst 40 Frequently Visited Cryptocurrency-Based Operators, (2022), https://psyarxiv.com/fgxrb/ 2022).22 Zhu, Navigating Crypto Wasteland, Deribit Insights (2020), https://web.archive.org/web/20220716075459/https://insights.deribit.com/market-research/navigating-the-crypto-gambling-wasteland/ 2022).23 ZeroEdge.Bet, Icomarks, https://web.archive.org/web/20220725145344/https://icomarks.com/ico/zeroedge-bet 2022).24 today, EDG USD live, marketcap chart CoinMarketCap, Coin Market Cap, https://web.archive.org/web/20220725151319/https://coinmarketcap.com/currencies/edgeless/ 2022).25 Isaacs, ZeroEdge.bet EXPOSED: Caught Huge ETH Scam!—Gamblescope, Gamblescope https://web.archive.org/web/20210726193951/https://gamblescope.com/news/casino-news/zeroedge.bet-exposed-caught-in-huge-eth-scam.html 24, 2022).26 Id.27 12.28 Melissa Kearney Making Savers Winners: An Overview Prize-Linked Saving Products, inFinancial Literacy: Implications Retirement Security Financial Marketplace (Olivia Mitchell Annamaria Lusardi 2011); Shawn Cole, Benjamin Iverson Peter Tufano, Can Increase Savings? Empirical Evidence Savings Accounts, 68 Sci. 3282–3308 (2022).29 Jacob Cohen, Element Lottery British Bonds, 1694-1919, Economica 237–246 (1953).30 Whilst Gambling: Analysis 98 Am. 321–326 (2008).31 Sylvan Herskowitz, Saving, And Lumpy Liquidity Needs, J.: Applied 72–104 (2021).32 6.FiguresReferencesRelatedDetailsCited byCryptocurrencies Gamblified Assets Cryptocasinos: Novel Risks Public Health Approach Gambling22 February 2023 Risks, Vol. 11, 3 Volume 26Issue 9Nov 2022 InformationCopyright 2022, Mary Ann Liebert, Inc., publishersTo cite article:Philip Andrade.Commercial Products.Gaming Review.Nov 2022.463-465.http://doi.org/10.1089/glr2.2022.0035Published Volume: Issue 9: November 3, 2022Online Ahead Print:September 28, 2022Keywordscommercial gaminginternet gamingwireless gamingsports bettingPDF download