Benchmarking true provable fairness

With the crypto gambling industry constantly evolving, it can be easy for operators to fall behind with the latest innovations and optimal implementations. This is an understandable setback when it comes to keeping up with the fastest growing industry in the world; but when it starts to affect the expected standards towards fairness in gambling, we feel the need to step in. We want to establish a genuine representation for the players and their best interests.

In our previous article, we wanted to raise appropriate awareness towards operators in the industry who are refusing to conform to industry standards in regard to how they handle the fairness implementations on their platform. This article will discuss the technical reasoning behind why these outdated implementations of provable fairness are dangerous for players, as well as what would need to be done to fix the inherent problems associated.

The problem

  • If you are using a unique server seed and/or client seed pair during each bet, this means that ultimately the power of the result is in the operators control. This is only unless the player checks the current pairing before each and every bet. Not only is this cumbersome but absolutely ridiculous when it comes to the player experience. This sort of implementation not only takes advantage of the fact players must blindly trust the operator if they don’t validate each pair, but also is somewhat deceitful when an appropriate solution exists but isn’t implemented.


Here's an example:

An operator can see that you are using a single strategy when auto-betting (ironically how most auto-betting platforms are setup) and then selectively choose which pair combinations can be offered to be in their favour.


The solution

  • Implement a nonce into the provably fairness algorithm OR use the salt/hash method. These methods ensure that you can transparently ensure that all bets conform to a genuine result stream that has been predetermined even before a player sets up an auto-betting strategy, without the need to tediously check before you place every single bet with that operator.
  • For operators like Luckygames, this would easily be solved by extending on their current provably fair algorithm to incorporate a nonce for each bet. This is not an unrealistic implementation and something that all players should be demanding to ensure there is no possible deceit in play.

Our goal here at the Crypto Gambling Foundation is to ensure the people with the smallest voice get the most out of their gambling experience. It’s easy for large casino operators to blindly provide a service that doesn’t ensure true legitimacy, especially when they utilise their large community following to dilute the concerns of players who genuinely care about their wellbeing.

There is nothing more harmful than operators in our industry who tarnish the integrity of provably fairness, especially consider how beneficial it is when implemented correctly.

The story of how the Pelayos family took on a local casino

Gonzalo García-Pelayo is the head of the Pelayos family, which gained notoriety and fame for their gambling exploits in the 90s. He devised a statistical based system for winning on the roulette wheel. Using this system, the Pelayos clan won over 1.2 million euros mainly in the Madrid Gran Casino between 1991 and 1995.

Gonzalo was a record producer turned professional gambler. Being an avid roulette player, he observed that each roulette wheel had its own unique bias (imperfections) that made the spin results less random.

Roulette wheel bias; wheel bias is when specific numbers on a roulette wheel win more than others after many spins. Biased roulette wheels are flawed not rigged and are caused by several factors like; flaws in the wheels design, wear and tear, uneven table surface, etc.

The García-Pelayo’s system; Together, with his children, mainly his son Ivan and daughter Vanessa, they dedicated time and energy to observing and recording results from thousands of roulette spins at the Casino Gran Madrid. Gonzalo fed the collated data onto a computer program to ascertain which numbers won the most at each wheel. They found that most of the wheels had certain numbers the marble was more likely to fall into. The system effectively enabled him predict where the roulette ball would most likely drop, thus turning the casinos 2.7% house edge into his own 15% edge.

Armed with this information, they placed wagers on the “hot” numbers and won a lot of money to the chagrin of the Madrid Gran Casino manager called “The beast”. They were subsequently banned from the Madrid Gran Casino and other casinos in Spain, but they used intermediaries to play their numbers for a share of the profits. However, their hired players were also busted and the casino operators dragged them to court.

They moved to casinos in other parts of Europe and were successful applying their system. There were big wins in Vienna for €85.000 in one night, in Amsterdam for almost €78.000 and €240.000 in Lloret de Mar. Word spread about them in European casinos, and they were banned by most operators. They headed for Sin City Las Vegas and within a few days they made big profits from their system. It wasn't long before the operators realised what was amiss, and kicked them out.

Court case; Back in Spain, the supreme court ruled in favor of the Pelayos family. The judge, in his submissions, said that Gonzalo had used his ingenuity to gain an edge, and that the Los Pelayos had not broken any laws. Their actions were not deemed to be fraudulent and weren’t unlawful in the eyes of the court, as they did not fix the roulette wheels in any way, shape or form.

Aftermath; After retiring from playing roulette due to his many casino bans, Gonzalo and the Pelayos' have dabbled into various things like trying to create a winning system for online poker with their own poker school.

Write better reviews, give better understanding

You may have had an experience with a site that caused you to want to write a review about it. Maybe you had a positive experience, or a negative one. Ultimately, you'll want to learn to write your reviews in the best way possible so that you can cleanly convey your thoughts to your readers.

Focus points for good reviews

  • Be concise. Readers will often skip right past big walls of text without reading them.
  • Only include relevant details. Nobody else cares what your dog ate that day, and it doesn't help readers who are reading to form an opinion. Keep the information restricted to what will help people.
  • 5 star reviews aren't always taken seriously. Was there really nothing wrong? Readers will often browse critical reviews first to find recurring problems instead of looking at only positive reviews. Instead, consider listing both pros and cons in your reviews to cover as much as possible.
  • Edit your review. If possible, when important circumstances covered in your review change, edit your review to reflect it. Instead of changing your review completely though, simply add a note at the end that states the problem was corrected or made worse. This helps to keep your review relevant.

These are only focus points. Sometimes, you can't keep your review short. You may instead need to type up a long story that fewer people will read but brings more impact. You must be the judge of your own content. If you post high quality content, then people will trust you more and your future reviews will have more impact.

Finally, if you receive money for your reviews, make sure to keep them honest and high quality. Nothing hurts your integrity more than churning out a bunch of poorly researched, low quality reviews.

If you're looking for a place to post reviews of gambling sites, check out CGF's reviews forum. You can post reviews on many sites and discuss your views and concerns with others. You can find the casinos in both the verified operator and unverified operator sections.

The “Welcome Bonus” gimmick

Online casino bonuses come with Terms & Conditions that are not player friendly. Accepting these bonuses often leads to bettors not being able to withdraw their winnings, and in some cases having both their deposit and bonus confiscated by rogue casinos.

The average gambler, especially those unaccustomed to the online casino scene, are often not aware of some of these bogus T&C's. Many see the welcome bonus sign and proceed to deposit funds, thinking it is all free money. Sadly, a lot of online casinos operate solely to cheat players, and do everything possible to ensure players lose.

Wagering Requirements

The most controversial welcome bonus condition set by casinos is called the wagering requirement. This is the amount set by casinos which a player has to bet before their bonus is credited into their cash balance.

Most times, when a player opts in for a bonus, they are unable to withdraw their deposits and bonus until they have made enough bets to reach the required turnover threshold set by the casino.

It is worth considering that casino games are always established to be in favour of the house. The house-edge, vig or over-round are set in a way that ensures players lose in the long-term. Even when gamblers go on winning runs, they eventually lose trying to reach the turnover limit set by the casino.

To add insult to injury, some bets are deemed ineligible for clearing turnover requirements. For example, bets made playing blackjack don’t often qualify because very good players are capable of devising strategies to minimize losses and increase their win rates.

In sports betting, the required odds are set very high by the casinos. This, coupled with the number of times a player must turn over their deposit and bonus amount ensures they lose it all. Generally casinos aren’t enamored towards winning gamblers and often ban or limit them as soon as possible.

Experienced online gamblers often say claiming welcome bonuses is too much of a hassle these days. However, there are still genuine offers that aren’t designed to cheat players.

Casinos also use this method to protect themselves from players that abuse sign-up offers. There are a few things a player can do to ascertain if a bonus is worth claiming or not, before depositing their hard-earned money into an online casino.

  • Look out for predatory T&C's
    It is the player's responsibility to always read the casino’s bonus terms and conditions. The player must make sure they fully understand all the clauses before making a deposit. If the turnover requirement is draconian, avoid the casino at all cost.
  • Operating with true fairness
    Before depositing into any casino, it is very important to confirm that they are either providing provably fair gambling, or in some way or another are regulated and have a license. If they don’t have any form of fairness system in place, avoid them at all cost.
  • Positive reviews and endorsements
    Players must try as much as possible to search online for reviews and feedback from other players, both positive and negative before making a deposit. This is often the best way to gauge if a casino will cheat you or not.
  • Verification & jurisdiction
    Most casinos require KYC to determine if a player is eligible to use their platform. Always confirm if a casino allows players from your country. And whenever possible, confirm your identity before depositing to save yourself future hassles during the withdrawal process.

Established casinos have a brand to protect and more often than not offer bonuses with reasonable terms. However, these conditions are designed to keep players betting for extended periods and only a lucky few complete them. The only way players can protect themselves is by researching and due diligence. Always read the T&C’s before committing.

Why I believe in provable fairness

Bitcoin was created on the principle of trustlessness. Back when it was created, it didn't attract the same crowds that it does today, the investors and the people wanting to make money off the rise. The people that worked on and built the Bitcoin ecosystem were there because they didn't want to have to put their trust into anybody. Provable fairness was created as a direct consequence of this. People looked at traditional gambling and saw something that could be improved upon, something that could be changed the same way they looked at money and thought of Bitcoin. The result was the first completely trustless gambling system the Internet had ever seen, and it sparked a boom. Although the system originally only applied to generating random numbers for dice, the process was quickly adapted into many other games and a whole new community was formed.

But as Bitcoin grew more and more, and started attracting different people, people started joining the community that weren't familiar with these systems. These people through no fault of their own simply didn't understand the significance of being provably fair, or what it really meant. Later on, some people with lighter sets of morals started trying to take advantage of this lack of knowledge. Some of them used software they bought from some other company, something they could not possibly understand the inner workings of and claimed it to be provably fair. Or worse, they created systems that at first looked to be provably fair but upon closer inspection contained holes that made it difficult for users to keep the site truly provably fair. These people looked to take advantage of the newcomers that didn't know the reasons behind this technology that had been created for the user's benefit.

I want to see this community be reminded of why provable fairness was created. I want to see people educated, and I want to see people take advantage of these systems that have been set up for their peace of mind. I also want to see these people that claim they are what they are not brought to light. I believe that all the new people that have joined our once small community will all be able to see the benefit once they understand the technology and the reasons for it's creation. I believe in provable fairness because it shares the same core principles as Bitcoin itself, and once people see and understand it I know that they will see what an amazing thing it is.

What is provably fair gaming?

Before we may begin to understand what makes a casino provably fair, we need to study how the basis of online gambling works. Simply put, players bet on the outcome of randomly generated numbers.

Formerly, these random numbers were generated solely by the host of a game, leaving complete control in the hands of operators. Participants had to trust the host not generating results in favor of anyone. Casinos operating on these merits caused conflict of interest for those seeking a fair gambling experience.

Due to lack of transparency, the essence of provably fair games was born. Corresponding concepts provide a way for both the operators and players to contribute to randomization, which in turn removes any possibility of deceit or cheating.

The foundation of fair gaming algorithms were laid by pseudorandom number generators, utilizing seeds which determine the outcome of wagers.

A seed shall be equally influenced by players and hosts, meaning that the result of each bet at a provably fair casino is a team effort. The house is no longer in complete control of randomization.

So, wouldn't this mean that players are able to manipulate results in their own favor?

Commitment schemes to the rescue!

To prevent malicious behavior, hosts mustn't show us their actual seed at first. Instead, they present a commitment of their own seed to us. Similarly to envelopes, commitments seal and conceal messages contained by them. They cannot be altered or revealed without consent from the sender. For example, hosts may commit a seed by using a one-way hash function or public key cryptography.

Hosts shall provide transparency and proof of authenticity by revealing their actual seeds at the end of each game. Anyone in possession of a host's commitment may verify the immutability of the corresponding seed.

Bets shall be reproducible once the host seed gets revealed. Players can constantly audit the behavior of hosts by comparing random results calculated by a host and them.

Proving that the outcome of a wager is computed fairly and transparently should be performed by anyone at any time. We strongly believe in widespread use of provably fair algorithms throughout the gaming industry.

download If you would like to learn more about the technical workings of provably fair algorithms, you can download my whitepaper found here.