Having covered a couple betable sports and some basic expectations of what one might get out of sports betting. Before getting much deeper into this exploration though it is important to bring up a critical point concerning the relationship between sports betting and Bitcoin, that there really isn't much of one. This thing seemed timely since the announcement that everyone's favorite Bitcoin Baron is wagering serious money that Bitcoin outperforms Berkshire Hathaway.
For some perspective on this matter consider the largest sports bets in the history of BitBet.1 In their history 10 of the 11 largest sports bets on that platform by the sum of BTC wagered were all resolved more than one year ago. The top bet by sum of BTC wager was on this year's superbowl coin toss with the bet's underwriter seeding each side with 100 BTC. If that bet were discounted, the 10 largest sports bets would all be from an era when BTC was in a low two digit number of dollars per. Scrolling down the list we see:
- The 12th largest bet was on the rather hotly anticipated game between Alabama and Texas A&M six months ago2 10.8 BTC wagered
- The 13th largest bet is yet to resolve on Simona Halep to win Roland Garros34 7.25 BTC wagered so far
A bit further down we finally get some baseball related bets:
- MLB Season Opener Rangers over Astros 1.8 BTC wagered
- St Louis Cardinals will win the 2013 World Series 1.75 BTC wagered
Maybe some of these bet seem big? Let's gather a point of comparison by considering the size of BitBet's five largest bets.
- Bitcoin difficulty at or above 2B before Feb 2014 1886.91 BTC wagered
- BFL will deliver ASIC devices before March 1st (2013) 1689.81 BTC wagered
- Bitcoin to surpass Berkshire as an investment (opened March 16th, 2014) 1029.63 BTC wagered so far
- BTC network difficulty to top 1B before 2014 693.40 BTC wagered
- MtGox Bitcoin USD Exchange Rate >= $200 Before End of April 2013 485.89 BTC wagered
Now that there is a point of comparison we can see that the two largest wagers happened roughly a year apart, with the more recent of the two attracting more wagers. While size of sports wagers on BitBet has gone down substantially as the value of Bitcoin relative to the US dollar has appreciated, the appreciation hasn't killed the appetite for large wagers. If anything, it has enhanced the appetite for certain kinds of large wagers, the ones can provide a hedge against risk that in more mature markets might provided through insurance schemes that don't advertise so transparently their operations are gambling related. Because in the essentials, pricing risk is gambling, and gambling is pricing risk.
The insurance function of wagering naturally can attract larger wagers than sports as it serves people who already have some skin in the game. Without a place to hedge they might find themselves with all of their skin in the game.
- If you are having trouble viewing them, on the linked page choose the category sports, status all, and order by bets sum. [↩]
- Hotly anticipated because A&M gave Alabama their sole lost of the season the year prior when Alabama won the BCS National Championship as they have so frequently done. [↩]
- Also known as the French open. [↩]
- A great example of bettors coming out to balance a somewhat larger initial bet brining the odds inline with other venues. [↩]