Can somebody explain to me how profit and losses sharing will works here?
Case one - player wins 1 BTC from any moneypot app in single bet.
What I know is -
40% to app owners ( 40% of the house edge) equals to - 0.004 BTC
10% to Mp ( 10% of the house edge) equals to - 0.001 BTC
Investors need to pay - 1BTC+ 0.004+0.001 = 1.005BTC in total will disappear from the investors account.
Case two - player losses 1 BTC in any moneypot app in single bet.
What I know is -
40% to app owners ( 40% of the house edge) equals to - 0.004 BTC
10% to Mp ( 10% of the house edge) equals to - 0.001 BTC
40% to investors - ( 40% of the house edge) equals to - 0.004 BTC
All together is 0.009 BTC
If we deduct this 0.009 BTC from 1 BTC = 0.991 BTC
Please explain to me who will take this 0.991 BTC and how it will be distributed
I know my understanding is not correct. Thanks
40% of the house edge goes to app owners
10% of the house edge goes to MP
so 50% of the house edge is going to the investors
of the profit investors make from their 50% of the house edge, app owners and MP each get 10%; that represents a further 5% of the house edge for each
so the investors end up getting 40% of the house edge
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For your specific examples:
when the player wins a 1 BTC bet (at 2x) the app gets 0.004, MP gets 0.001, and the investors pay 1.005
when the player loses a 1 BTC bet the app gets 0.004, MP gets 0.001, and the investors get 0.995
but then, at the end of the week, the investors pay 20% of their net profit: 10% to the apps, and 10% to MP.
So suppose there were 1000 bets in the week. All of them were for 1 BTC at 2x, with a 49.5% chance of winning. A house edge of 1%.
Suppose 495 of them won and 505 of them lost. That's the expected result.
On each of the 495 winning bets the investors pay out 1.005; they pay a total of 1.005 * 495 = 497.475
On each of the 505 losing bets the investors earn 0.995; they earn a total of 0.995 * 505 = 502.475
Their net profit is 502.475 - 497.475 = 5 on a total amount wagered of 1000. That's 50% of the house edge.
At the end of the week they pay 10% of their profit to the apps, and 10% to MP; that's 0.5 BTC to each.
They are left with a profit of 4. That's 40% of the house edge.
Get it now?