Quote from: a1choi on September 30, 2014, 04:59:31 AM

Quote from: Phrenico on September 30, 2014, 03:05:06 AM

You're smart enough to know how misleading that is. Expected return is the same; the investors are just giving PRC free insurance to dampen the volatility in the site's commissions.

If Dean needs consistent income to operate the site, then so be it. People can divest if they don't want to take on the (slight) extra risk.

I don't know how this could be 100% the same as the old model (in the long run) as the old model didn't give dean any profits on losses, and only on wins? or maybe i have my math wrong on that and it doesnt matter..

The old model gave Dean more profits on wins and no profits on losses. By contrast, this system gives Dean profits that only depend on the amount wagered. Ignoring the variability in the amount wagered, this new system just gives Dean steady but small profits, versus variable profits in the old system.

You're right to say that the model is not 100% the same. Expected profit isn't everything. In traditional investing, if expected profit is known to be positive, you can always hedge against volatility with financial instruments. We don't really have that option yet in the world of crowdsourced bitcoin casino investing.