What Is Provably Fair Gambling?

Cryptocurrency casinos were the first to pioneer the concept of provable fairness - a method to demonstrate that the house is unable to meddle with the outcome of a roll. Today, provably fair systems are quintessential to assuring trust in the online gambling ecosystem, especially for platforms that develop their own games. 

Despite the demand for fully-fair gambling solutions, many casinos continue to choose alternative, yet inefficient fairness mechanisms. Other platforms don’t even mention fairness, blindly hoping that their customers would trust them without being offered proof. 

How Common Gambling Fairness Mechanisms Work

• Deterministic provable fairness

There are multiple variations to this fairness mechanism, but it’s commonly regarded as the safest method for players. For deterministic provable fairness, the service operator will publicly showcase the method it uses to determine a roll’s outcome. 

The gist is that both the player and the casino play a shared role in a bet’s outcome. Both parties will choose a secret string, commonly referred to as the server and client secret. This string is the hashed version of an editable seed - a random collection of characters. While client seeds are created automatically, provably fair casinos will allow users to change this seed. An automated system will then take both values and apply an algorithm to create an outcome. A nonce usually modifies the seeds after each roll to make it impossible for either the casino or the player to foresee the next roll’s outcome.  

• Ambiguous random number generators and third-party fairness audits 

Some casinos will determine bet outcomes by relying on random number generators (RNGs). These are algorithms that solely come up with a bet’s outcome, without relying on separate pieces of information. This method is not provably fair, so users must trust the casino. This is normally the case with slot machines in real-life casinos and numerous platforms that publish games from external casino software developers. 

Customers base their trust on reputation and hope for the best. These casinos often advertise that their games are audited for fairness by third-parties, but there’s a general lack of transparency regarding these audits. Indeed, such casinos may risk their license if they’re caught meddling with roll results, but this recipe does not guarantee absolute fairness. 

Case study - Provable Fairness on EarnBet

EarnBet is a decentralized and blockchain-based crypto casino that has solved the gambling fairness challenge by adopting a multi-layered approach. Here’s an overview of EarnBet’s provably fair system: 

• A detailed description of the randomness generation technique

The server will utilize a customizable client seed to grant each bet a unique ID within a smart contract. The transaction is then signed by the server using a predetermined private key. This signature is passed back to the smart contract and verified to check whether the correct secret key was used. The smart contract will use the signature to derive a deterministic random number which then resolves the pending bet. Players are free and encouraged to customize the seed for extra assurance. 

• On-chain bet recording assures transparency

Every bet and its afferent result is automatically recorded on to the Wax blockchain, essentially allowing any interested party to verify past bets. In fact, EarnBet’s entire operations are transparently recorded on-chain. This includes dividend payouts, jackpot rolls, and affiliate transactions. 

• EarnBet has publicly revealed the code of its Dice game

With open-source code, no user can dispute transaction outcomes. The code clearly showcases every step taken by the program to process bets, thereby guaranteeing fairness. Readers can check out EarnBet’s open-source dice game code on GitLab. 

• Third-party fairness reports

Unlike some casinos that only promise audits but never reveal the results, EarnBet’s games hold complete fairness reports. Such is the case with the Dice game, which was audited for fairness through a complex chainalysis procedure. The methodology included a chi-squared analysis of bet distribution, bet receipts, and roll outcomes. As expected, the audit concluded that the Dice game is statistically fair. 

Bottom Line

Based on these aspects, gambling platforms utilize numerous strategies to assure fairness. Our research has shown that multi-layered approaches that entail transparent on-chain records, statistical analyses, and algorithm descriptions, are superior to ambiguous RNGs or untrusted third-party audits. Consequently, licensed cryptocurrency casinos like EarnBet are pioneering the future of provably fair gambling.