Online sports betting: As you do well, they cut you off
doc.searls.com
doc.searls.com
In a healthy economy “Tails I win, heads you lose” businesses should not be allowed to succeed.
If we're pretending it's entertainment, then it shouldn't matter that winners get shut down... because it's just supposed to be fun. If we're not pretending it's entertainment, then we need to deal with the fact that it's a huge negative payoff vice we shouldn't be allowing to happen easily (make it legal and rare).
The idea that we're trying to create "fairness" in a business that basically wouldn't exist if the operators don't have a guarantee of success is ridiculous. We can either require sports betting agencies to have betting lines that require their bets be balanced or we can basically ban them from becoming a large industry.
Paying for entertainment is a normal activity. People do it every day. But gambling feels different: you can pay a nearly unlimited amount for it. There are usually limits in other forms of entertainment. I can only see so many movies in a theater in a day. I can only go to so many concerts. The number of board games I can buy is limited by the storage space in my house.
I'm sure there are exceptions in some types of entertainment I haven't thought of, though.
No, they'll just hike premiums or refuse to insure you.
Earlier this year, sportsbooks lost a lot due to punter-friendly outcomes (a series of favourites winning), and they didn't cut people off. Doing this is extremely bad for business because: people won't come back, and you aren't giving customers the opportunity to lose that money back to you.
So what you are seeing when people are limited is not this but arbing line moves between bookmakers, people bearding for someone else, etc.
One of the articles mentions stuff relating to player behaviour - for example, if you bet on Australian Rules Football, you bet every game for multiple weeks then it doesn't matter if you win or lose, there is going to be a limit - there is a grey area, but the majority of people being limited don't fall into this category. They are just people doing stupid stuff (I have done this, I used to arb line moves 20 years ago in the UK, I have been banned everywhere, it is stupid and I should have been banned).
This is what market makers doing 24/7 on public stock markets. This is what creates "efficient markets".
It doesn't improve efficiency in any way because the price you are taking is known. If you are betting on the open with Asian books, you are adding to price discovery. By the time most bookmakers open their lines, the price of the risk is known so you placing your $100 bet isn't improving efficiency, it is just noise.
There definitely are -- everything from margin limitations, maintenance requirements, regulatory bodies, and counter party risk.
> It doesn't improve efficiency in any way because the price you are taking is known.
The price you are taking when you buy a stock is also known to all participants. Just like sports betting, the marketmaker (bookie) is profiting between the bid & ask spread.
When Betfair first came on to the scenes the traditional online (and offline) bookmakers were like fish in a barrel for arb bets.
I still remember when the first major bookmaker (pretty sure it was BetVictor) started tracking Betfair markets automatically. Now they all do it.
Also, their tech even today is still dogshit. It looks like they are tracking Betfair prices but most bookies use third parties for pricing, OpenBet for example, and so it is usually the third party tracking. There is still inherent latency so the main tool has been delays and limiting certain customers. This is why ppl who say they should just take any bet are idiots, it isn't a stock exchange (and most of these third parties also have massive latency in their stack too, naming no names...the stuff I have heard about how they run things is incredible).
I have done sports betting like three times, when I realized the odds were bonkers, and retrieving the money after winning was an extreme hazzle that took weeks with photocopies of passports and gas bills and what not. Paying the bets took a minute.
I mean, online betting is a shady business. Physical casinos at least have some sort of brick wall to bang your head against.
Blame the AML/KYC/income tax regulatory regime. Placing a bet doesn't require KYC any more than spending $10k at a club doesn't require KYC. However once the casino needs to disburse money Uncle Sam suddenly wants his cut and to make sure it doesn't go to Bad People.
Ideally we probably should have higher barriers to gambling on both sides, kind of like we do cigarettes.
that has nothing to do with sports betting. it's the same with trading stocks/forex/..., it's KYC/AML
[1] A heuristic to minimize your losses, because favorites are underbet, if you have minimal information
That's every gambling place/app, should they all be made illegal? Not that I'm disagreeing...
I don’t think Polymarket does this, but I also think it would be OK if the casino takes a cut of the prize pool, as long as it ensures that winners never receive less than they bet. For example, the casino may receive $losers/n (they pick n, $losers = total bets of losers), and winners receive $bet($losers(n - 1)/n + $winners)/$winners, $winners = total bets of winners, $bet = their bet).
Then it’s “tails = I win you lose, heads = we both win someone else loses, except nobody wins if everyone gets heads but that’s extremely unlikely (especially with more than 2 options)”.
* If you start applying the martingale to roulette, you will quickly be pointed to the exit.
Yeah, but if you try to "count cards" (i.e. actually utilize probability to play effectively) they'll throw you out. The parent comment is right that this is basically how all gambling against a business works. I'd totally be in favor of them all being illegal, but I also doubt that it would be feasible due to most people not sharing this view; it would probably go down about as well as prohibition (which ironically is also something I'm one of the few who would be relatively unaffected by given that I don't drink).
I think it’s immoral to allow their bad decisions to raise costs for those of us who do not care who wins the Big Game.
There's a vague parallel with the homelessness problem in my city: I would rather my tax dollars go toward giving people stable housing for free (along with job placement, drug addiction treatment, etc.), because any other use of that money (clearing out tent encampments, jailing addicts, etc.) doesn't actually fix the problem, and ultimately costs more in the long run. (And meanwhile, the city is dirty and I feel less safe walking around in it.)
Sure, giving someone housing for free isn't "fair" to all the people who work hard to pay their rent or mortgage, but sometimes fairness doesn't give us (all of us, not just the people involved) the best outcomes. And it may not be "fair" to limit what businesses are allowed to "sell" to consenting adults, but I am willing to accept that some businesses will not be as profitable if it means society is healthier.
When, as has been pointed out in this thread, people are instead being deceived and told the playing field is level, yeah, no we should not allow that.
If you instead ask if people should be allowed to make money on exploiting "bugs in human behavior", whether society should help casinos collect on gambling debts etc, in short whether this is an institution we should allow, it becomes a lot harder to justify.
Let's demonstrate that by just jumping to the end of this reasoning -- severely mentally retarded adults -- can they consent to sex? Why or why not?
This kind of argument is not particularly interesting; the entire point of a discussion board is for everyone to post and discuss their opinions, which will naturally differ sometimes. Asking what amounts to, "why are you allowed to have that opinion?" is pretty pointless.
We can endlessly debate morality, ethics and all that regarding lots of things, but in my humble opinion gambling could be reduced to:
"Would people still engage in those games of chance if there was no monetary aspect to it?"
And then how many of those people who would still engage with them are "notorious" gamblers on whom those games had a clear negative impact (in most people's eyes).
The choice is between the mafia or this. This is better than the mafia.
Any other argument is basically utopian.
I love mafia history though so I think many people just don't understand how powerful the mafia was in 20th century America.
Of course, it wouldn't be the Italians this time. It would be the Mexicans. A horrific thought.
And who ensures everything is happening above board and there is no fixing? Don't worry, self regulation works.
One of the greatest incentives to stop match fixing comes from having regulated operators who will report unusual betting behaviour. For example, the massive problems with match-fixing in low-ranked tennis has been tackled by bookmakers.
There is an issue with advertising but that is unrelated to the match-fixing one. The latter is one of the absolute oldest lobbying lines the Republicans used when they were getting all their money from Adelson (it was accompanied with some mad intellectual gymnastics about how sports betting at casinos was also magically unaffected by this, same with underage gambling).
The Online Sports Gambling Experiment Has Failed
https://news.ycombinator.com/item?id=42110194
Legalizing Sports Gambling Was a Mistake
https://news.ycombinator.com/item?id=41659458
Should Sports Betting Be Banned?
The sharp books more or less operated the way you're describing. They would try to set the line as close to the true odds as possible. They knew who the sharp bettors were, and they may have limited their bets to some degree, but they would take them and adjust the lines accordingly. You have to be a very good bookmaker for this strategy to work, because every line that's a little bit off is going to get pounced on for the max bet.
The square books' strategy was to keep the sharp bettors out by limiting their bets severely or kicking them out entirely. This also lets them set the lines in a way that makes them more money, because there are a number of biases recreational bettors tend to be subject to. In particular, they tend to overbet on favorites, and they tend to underappreciate the home team advantage. There's also an effect where people will tend to bet on their favorite team, and so teams from large markets get more bets than teams from small markets. By moving the line a few percent one way, they can make significantly more money on average.
BetFair calls it the Expert Fee :))
If you make more than $100k profit, you pay 40% extra Expert Tax on it :)
https://support.betfair.com/app/answers/detail/expert-fee-fa...
You're right: TIL, so thank you. I've done no more than dip my toe in the water on betting exchanges.
That level of expert tax seems... rude. Really rude.
But I wonder if some goes to the government in lieu of taxes that would not otherwise be payable on winnings from gambling (at least not here, in the UK, since winnings from gambling aren't taxable).
And modern KYC checks mean, I'd imagine, you can't simply subvert this by running multiple accounts or by periodically shutting down your accounts and setting up new ones.
The problem in the US is that it is a highly competitive market so you have to acquire your customer base every weekend, and these customers don't actually care so much about prices. So having weaker prices is a more effective way to deliver the product. In addition, US gamblers like parlays, parlays are more profitable, have lower volume per bet, and (so far) the economics of the Asian book don't work for this market (i.e. get syndicates to bet your lines early).
But if some whale comes in and wants to drop a large bet, I suppose the house doesn't want to sit around and wait for the same amount of action on the other side before they take the bet or the game starts. And now they're exposed if the whale wins.
[0] I'm using small numbers because the total value of matched bets on many horse races can be small. If you go in and drop £100k or £10k, or even £1k, especially if you did it all in one go (and assuming the exchange would allow it), there are plenty of races where only a tiny portion of that would be matched. In fact most races have only thousands of pounds or low five figures matched.
Online sports betting is a mug’s game.
I made a few hundred dollars and have quit for a couple of years now once I learnt that they can kick you out for doing too well.
Putting money on a game you don’t care about can make it exciting.
Getting a bunch of people watching a game together with money on it is a way to drum up a crowd of enthusiastic temporary fans for any game, which might lead to a fun high energy atmosphere.
The problem is that the crowd will likely have divided rooting interests and things could get… confrontational
But too often the ability to turn everything into a math problem lets you easily abstract away the reality of what you’re doing
I wonder if there is any merit in building an app that helps gambling addicts by letting them play the same games that they would play on their phones, with a few caveats:
1 - It's all virtual money, just like a demo account on a stock trading service where you can test it out without real money being involved. You don't use real money, and the app is free to download and play. The goal isn't to make money from the app, it's to help treat gambling addiction.
2 - Where the games would tempt you to place another bet and say "better luck next time?" or "so close" and tempt the player to make another bet, this game would do something different:
- When a player loses on their go, it would say "if you'd staked real money, that would have cost you £2 etc". - It would also remind you of the total balance, and say "if you'd played for real, then you would be down £200 tonight, but because you played this game instead, you've saved yourself £200." - When a player wins on their go, it would say "congratulations on winning, that was your first win in the previous 6 go's".
The idea is to change the cognitive behaviour of the player so that a) they get to play a game that they enjoy playing and find addictive to play, but crucially b) they don't lose any money, and because they are shown the reality of what gambling is like from an accounting perspective, their cognitive association with gambling is changed.
It's better to play a fun game for free then to play a game that drains you of all your money.
How is that idea. Good, bad?
(Compare vs gatcha, which doesn't allow you to cash out. Predictably there's also gatcha simulators if you just want to roll for things meaninglessly)
Free-to-play/play money site paradisepoker.net however somehow found the money to advertise extensively. It was a real mystery…
There's also a bunch of fun dark patterns (side currencies, battle pass and leaderboard features, and account evolution you need to play X amount to unlock different games, and once you've played that much you can no longer scale down to very low wagers to make the free tokens last longer.)
At least Genshin Impact has a fairly high quality game with some play value attached to the shitty casino.
If anything news is like a mirror image of gambling. People vastly overestimate how likely they will hit a jackpot the same way they vastly overestimate how likely they will die in a plane crash.
Goofus: Yes, I bet on them all the time. Why do you ask?
Gallant: I don't really bet, actually. Haven't even downloaded the apps.
Galaxy: Fanduel has me limited to 25 cent bets. Hardrock at 2 dollar bets. And draftkings kicked me off entirely. I'm waiting for a good opportunity for betmgm until I open an account there.
Further, people will pay to be 'mules' for professional gamblers so that those gamblers will wreck the reputation of those people at the large gambling apps, making it seem like the 'mule' is actually a 'sharpe'.
NFL broadcasts lean so heavily into betting odds, parlays, prop bets, everything… it’s so obnoxious hearing about X player hitting the over, only to go to a commercial offering some free money if you place a certain sized bet.
I really hope (but am not holding my breath given how much money is involved at this point) they ban sports betting advertising in the future.
It was a mistake, and we should accept that.
We went wayyyyy too permissive with sports betting by allowing it online. It should be something that you can do at a casino, but on your phone, at home, alone? That's just begging for serious harm to the addicted.
I acknowledge this means funneling those left to a small number who will make lots of money … hey look, now I’m describing Vegas.
Agree on permissiveness. I think reducing ease of access would cut users down to 1/5 … though not sure if that’s realistic with the cat out of the bag.
Did fantasy sports have a causal role as a gateway that slowly normalized gambling, or were they just reflecting that there has always been a latent thirst for gambling and fantasy sports were the only socially acceptable way to scratch that itch?
* not talking about “daily fantasy” stuff which was just blatant gambling pretending to be fantasy sports to exploit a loophole
I guess I'm surprised anyone is surprised that casinos do this and always have. There has never been anything "fair" about a casino's relationship with players. Your only role in the relationship is to, on average over the long run, lose money. Their role is to take your money. A "sharp" player is anyone who consistently plays in a way that, on average over the long run, makes money, breaks even or minimizes your losses below the expected rate of return in the casino's financial model.
Any player who is not a sharp, is a 'valued customer' (aka 'playing like a consistently predictable loser'). Casinos have always been adept at spotting any players who behave in ways more like a sharp than a valued customer.
Football betting had "the pools", betting by post across a number of fixtures. Most famous was run by a retailer. https://en.m.wikipedia.org/wiki/Littlewoods
See also https://www.onlinebetting.org.uk/betting-guides/football/his...
When gambling was legalized in my area in 1990s it brought at least some working-class jobs and tax dollars. Now, those tax dollars were funded by people with an addiction, but they at least went somewhere local. And you can still go gambling occasionally and get a good meal and some drinks and maybe see a show. Worst comes to worst, at least in my state, you can sign an affidavit banning yourself from the casino floor.
Online gambling is just a Skinner box designed to take money out of severely addicted people's pockets. That's it. You can speed run racking up losses because the games are shorter and can be done faster. The sites operate out of jurisdictions that have loose regulations on the games. For all you know they could be making it not only unlikely, but impossible, to win.
Watch a few YouTube docs on a streamer named BossManJack if you want to see just how consuming it can get.
Both have very little societal value, other than alcohol's traditional role as a lubricant of social interaction, and there's no reason to actively promote them.
FWIW I love alcohol. I don't gamble because I don't enjoy it, but I have nothing against gambling.
But for things like legal services, medical procedures, and pharmaceuticals which were fundamentally unethical to advertise to the public, they were still forbidden for that reason.
That surely changed one day. Bless their hearts, they just wanted the kind of love that people have given to tobacco since they got a hold of it.
Or it got a hold of them :\
The same people that I have seen rage against other people gambling will also argue in favour of legalising drugs which are more addictive and can cause psychosis.
In addition, making it illegal does not stop actual addicts gambling. You can go offshore and get completely unregulated services, that comply with no regulators on harm prevention. The US was the largest sports betting market in the world when it was illegal in every state bar Nevada.
Also, online providers maintain lists of self-excluded people with state regulators (to be clear, the state holds the list, people put themselves on the list and are banned everywhere). Casinos are significantly less regulated in this area because, due to the nature of the product, is not possible to put in limitations to the product (for example, reality checks, loss limits, giving you access to data on your usage).
All regulated sites have third-party verification of their games by specialist testers and state regulators. Every change to every line of code that touches a regulated service is reported. It is not possible for operators to lose at casino games because of the scale, and you think they are willing to destroy it all to get your $10 faster?
The issue with online gambling is: some people cannot resist telling what other people (usually people poorer than them) what to do, and some people have not thought the alternatives through.
If a family father gets addicted to some drugs it's bad, but somewhat limited in impact, if it comes to gambling, those people ruin their families, very quickly.
Saying a drug addiction has a "somewhat limited" impact is delusional. Particularly as addiction is an inherent property of taking drugs, that is not the case for gambling.
If my father or mother got high or drunk every evening I did not. Terrible, pitiful, psychological nightmare, sure.
But I was not intoxicated.
On the other hand, I've seen the impacts of ludomania. When parents go broke or accumulate unpayable debts that's something you cannot recover with rehab and that will have insane implications for the whole family for decades.
I hope you understand now what I mean.
One of my best friends SO suffers of ludomania, a court has ordered his salary to be paid to her, and she gives him an 80€s monthly allowance. They got lucky, another family I know got completely ruined in the course of few weeks.
By the way, I'm polish/Italian, and we don't have hordes of homeless people, I don't think I've ever seen a single homeless person in my life in Poland.
That’s something that should be banned.
Debts should die as part of settling the decedent’s estate. (The US got this right, and I thought most of the world did as well.)
I don't see a way for this discussion to find a middle ground.
Ludomania is classified as a mental disorder and a very real illness.
I've seen it's effects along the effects of other addictions and my two cents is that it can be more devastating to people surrounding the addict than others.
Misery is misery regardless of the disorder, addiction or illness, we don't need to have a competition between it.
But it is very important to underline that gambling is not only increasingly legal but increasingly deregulated too.
The only way for this to be the case is if they don't do it very much. So if you're a new player and you get out pretty quick, or hop on once a month or whatever.
Which is not how gambling companies make their money. They make their money off the subset of their customers who have severe addictions - that makes up almost all their profit.
Right, like the Tobacco company isn't making money off a dumb 16 year old who bummed a cig under the bleachers.
- Seat belt laws
- Prescription requirements for drugs (whether that be Oxytocin or blood pressure medication)
- Building codes
- Minimum wage
I’m in favor of building codes for commercial and public buildings but not for detached private residences (or not at the current level anyway).
I’m opposed to minimum wage laws.
For oxytocin, I think people derive pleasure and overall significantly benefit from it and naturally encourage people to seek it out, despite it having a positive feedback loop in its mode of action.
Used under a doctor’s care and oversight, for patients where a prescription is indicated, benefits are well in excess of side effects. Maintaining the requirement for a prescription is fine.
Medicines for blood pressure management are likewise overwhelmingly beneficial, and so I want them to also be highly available to anyone for whom they’re indicated, though I think having a doctor in the loop to monitor is appropriate and needing a prescription is therefore fine.
Yet, I do not support a ban on alcohol and I suspect that an outright ban on tobacco would be worse than simply having high taxes on it.
Sports betting is probably closest to alcohol in this regard: lots of people get moderate enjoyment from it from time to time and some people have their lives significantly harmed or even ended, meaning the overall net is negative, even though many people experience a small positive.
I wouldn’t ban sports betting for the same reason I wouldn’t take away your glass of red wine with dinner.
Asking this question is a sign that you aren't interested in the answer.
There's and ongoing lawsuit alleging sports betting platforms sent promotions targeted to users on the exclusion list to encourage a relapse in their gambling addiction.
https://www.espn.com/espn/betting/story/_/id/44520842/baltim...
What the lawsuit alleges is that at-risk users with promotions. This is undoubtedly true because people who have gambling addictions use gambling products and there is no way to identify someone with a gambling addiction prior to them using the product (contrary to what the article says, there is no way for companies to identify these users either, there are multiple third-party vendors in the industry who claim to have developed ML models to identify at-risk behaviour...none of them work).
The lawsuit does not identify whether these users opted-out of promotions (every regulated provider has this option...if you don't want these promos, just turn them off). And does not identify what aspect of existing regulation is insufficient (as I just explained, if you are a gambling addict, you have the option of being unable to open an account at any regulated provider).
In other words, this is the equivalent of Baltimore suing Budweiser because alcoholics drink their beer. It misunderstands at a very fundamental level how society should operate and tells you everything about US society where companies are expected to have a social role (and btw, what is most odd about this is that MD has a state gambling regulator, Baltimore is complaining about things that government already has the power to fix...I suspect the issue is that this revenue source is not being distributed their way, govt officials need to eat too).
>https://www.espn.com/espn/betting/story/_/id/44520842/baltim...
Your linked article doesn't say anything about that claim?
BossManJack and his reactions are still worse - because he's built a whole twitch/discord empire around it with his "juicers". When he was in rehab he'd spend the 1 hr with his phone he was allowed per day streaming and losing money online.
Every evening, after a day of hiking, I would walk into a casino, sit down at the gambling machine, insert a $20 bill, and hit "drink service". A few minutes later a free beer emerged, and I promptly hit "cash out", collected my $20 and walked away (after a stop at the free popcorn machine too).
I think I may have come away with more than 80% of their clientele.
Either complete a probation period to show proficiency or demonstrate sufficient net worth
I wouldn't mind if we made the whole thing illegal, it's like a giant leech on society.
And I've never before in my career come across a company so stacked with narcissist assholes on the management side.
If you play poker against other players, the house will never cut you off (they take their rake and are happy). And as long as you give some action and are social, the whales keep playing you too (they're rich enough).
For example, guy like Picks office on Twitter is profitable, but I don't know if that's a large enough sample size.