Over the past seven weeks we have taken a literal deep-dive into the worlds of crypto casinos, cryptocurrencies and some of the mechanics of same; so now, it seems high time for us to throttle back a little and take a relaxed sojourn to the world of little-known, interesting and sometimes amusing crypto and crypto casino facts.
So kick back, get yourselves a G&T (…or five) and some of your favourite snacks, and let’s head on down the road of discovery together.
Opportunity Knocks
The very first crypto casino was SatoshiDice by Erik Voorhees and was it launched three years after Bitcoin was first released to the general public. Just like the very first video games, such as Pong, Battlezone, Asteroids and that awesome monochrome shooting game for TVs; Marksman, SatoshiDice’s first betting game was fiendishly simple yet immersive and immensely compelling.
Players would literally just send off wagered amounts to various bitcoin addresses and hope to win!
Ok, of course there was a little more to it than that. Players would send off their bitcoin wagers to various bitcoin ‘idice’ vanity addresses on the SatoshiDice platform. Each address would be assigned its own properties by way of smart contracts, so essentially, the whole process from receipt of funds, to determining odds, to selecting a winner and then paying out, would be completely automated.
So for instance, if you sent a wager to address ‘1dice4AVroKuCAMA1xz’ you would know in advance the max/min stake, the odds of a win, the prize multiplier and the payout percentage. Just one year after launch, SatoshiDice was so popular that it was one of the biggest drivers of all blockchain activity, accounting for over half of all transactions on the entire network. SatoshiDice was so big, it was literally moving the market!
“Small Americano? That’s one Bitcoin please Sir.”
Would you trade a Bitcoin for a coffee? Of course not!!
But in 2009 when the first bitcoin was first launched, it actually had no notional value at all; later in the same year, it had an estimated value of BTC 1.309 to the Dollar and a year after that, one bitcoin had a trading range of USD 0.08 to USD 0.0008.
Right up to the time when the first crypto casinos started to appear, one Bitcoin was still worth less than a coffee and as no one could possibly foresee the future worth of this still experimental concept in cryptocurrency, it is not surprising that some strange value quirks arose such as:
- In 2010, when one bitcoin was worth $0.0025, a programmer named Laszlo Hanyecz purchased two pizzas with 10,000 BTC; the value of the two pizzas equating to $25. At the time of writing, the value of 10,000 BTC would equate to approximately $710 Million. One hopes that Laszlo at least got extra pepperoni on his pizzas and that delivery was inclusive!
- In 2012, a man purchased a $500 Tesla Roadster with around 50 BTC. At the time, bitcoin was trading in a range of approximately $5 to $10. Today, a top-of-the-range Roadster would set you back around $250,000 in the States; equating, at the time of writing, to around three-and-a-half BTC. Though obviously volatile, at its peak price, one could have bought the Roadster for just 2 BTC. A salutary example of consumer price inflation in the case of the Tesla and of the unforeseen value of some investments.
- If we’re talking cars, then why not ‘go large’?! In 2013, a man purchased a Lamborghini Gallardo with 1,000 BTC. At the time, the Lamborghini was worth around $200,000 and therefore, the value of 1 BTC was around $200. Fast forward to today and a 2013 model Lamborghini Gallardo would, on average, go for around $150,000 and that would easily be covered by just over 2 BTC.
- Want a roof over your head? Well in 2013 so did a Florida buyer, who in one of the earliest cases of bitcoin being accepted in payment for real-estate, paid out around 300 BTC for a $27,000 house. Well, they say that you cant really put a value on comfort, security and stability, however just out of interest, the 300 BTC would at today’s value, be worth around $21.3 Million.
- We all have to work don’t we? Well yes, and many of us do so using our laptops. So its 2013… evidently by the examples mentioned above, a mind-bogglingly crazy year for Bitcoin expenditure, and you find yourself needing to buy a new laptop. Lo-and-behold, the laptop of your dreams appears at $1,700 and you reach into your wallet and find yourself a little short, so what do you do? Well back then, you might easily have done what a purchaser in the States did; he dipped into his crypto wallet and paid using BTC… 8.5 BTC to be precise. Fair enough, it probably seemed a good trade at the time, but fast-forward to today and 8.5 BTC would be worth around $603,000.
Looking back at these examples, it is easy, in hindsight, to perhaps view the exploits of these individuals less than sympathetically; but I guess that the lesson here is really that these purchasers didn’t and couldn’t foresee that bitcoin might rise so significantly in a few years’ time.
Certainly, at the time, bitcoin was a new, experimental currency that was largely untested and seen as a niche interest; early adopters were overwhelmingly motivated by the novelty of the technology, rather than its longer-term investment prospects. These fledgeling bitcoin transactions are now legendary within the annals of cryptocurrency history…which makes the individual purchasers, in my mind, legends as well!
A Bad Workman Always Blames His Tools
Part of the fun of crypto casinos lies in the ‘thrill of the chase’; that moment when you’ve staked your bet and are anxiously awaiting the result, knowing that you might win big, but that you also stand a chance of losing your crypto. Well, we’re all adults and everyone knows the nature of the game before playing, and if one loses, as all players must do some time, then it’s no good blaming the game, the odds or the weather…its all down to you.
And in regards of the misadventures of the legends of crypto mentioned above, here are a few examples of some crypto casino players and crypto holders who through lack of knowledge or mishap, hit the crypto buffers and had no one to blame but themselves.
- Back in the early days of cryptocurrencies, one of the main hazards to crypto holders was mismanagement of their own wallets; many early adopters just didn’t realise the importance of their password; enter Stefan Thomas, a German-born software developer and entrepreneur. Wishing to secure his crypto wallet private keys, he stored his copy within an Ironkey USB flash drive. Unfortunately, he subsequently forgot the password to the drive; his wallet contained around 7,000 bitcoin, worth at today’s values, almost half-a-billion dollars. To make things worse, the USB drive only allowed 10 incorrect password guesses before permanently locking Stefan out. There are currently only a few attempts left!
- Well, if you’re going to mess up, you might as well do it big; enter Janes Howells, an I.T. worker from Newport, Gwent… for non-Brits, that’s in Wales… which (for our U.S. readers) is tacked onto the left hand side of England, as you look at the map. In 2013 (which as we have seen, was a particularly unlucky year for some crypto holders), James accidentally threw out a hard drive containing the private keys of a crypto wallet: The wallet contained 8,000 BTC, which at today’s values, equates to around 0.57 billion dollars. The last known location of the drive was Newport Municipal Landfill. Despite repeated appeals to Newport City Council to allow a search-and-recovery attempt, these have been consistently denied on the grounds of environmental hazards, legal ownership of landfill waste, and the very limited prospects of success. So if you ever find yourself in the vicinity of Newport Municipal Landfill and just happen to have a metal detector on you.... BTW, NOT an endorsement, incitement or recommendation towards any course of action!!
So What’s Your Address?
Way back in the beginning, cryptocurrency wallets themselves, were relatively simple in design and concept, however, they required a level of technical knowledge and general understanding of the blockchain, which was oftentimes lacking, with crypto holders often ‘flying by the seat of their pants’. In many cases, keys were generated by (for those old enough to remember), command-line tools.
But just to digress a little, here are some examples of the complexities and hazards of managing early crypto wallets:
- The early wallet.dat files just sat on your computer similarly to how a notepad file does now; often unencrypted. Anyone gaining access to your computer, either physically or via malware could access your wallet and drain your funds.
- Those early wallets were not deterministic, or in layman’s terms, they did not use a single seed phrase as a universal backup for all of one’s addresses. Instead, a wallet owner would have to back up their wallet.dat file every single time a new address was generated, or risk losing everything.
- For the youngsters amongst us…you’ve got it really easy these days! You can just whiz about accomplishing your tasks, using the GUIs (Graphical User Interfaces) which are now commonplace. Way back, you would often have to use command line / terminal commands to accomplish tasks such as interfacing with your crypto funds.
- We’ve all heard of ‘thin clients’, well the very first wallet, known as the Satoshi Client and later also as ‘Bitcoin-Qt’, was something of a ‘thick client’, requiring users to run a ‘full node’, or in simple terms, to download a wallet’s full transaction history.
Ok, now we’ve done that, lets un-digress and get back to the point, which was, that back in the early days (and even right up to more recent times), the complexities of managing a crypto wallet and undertaking crypto transactions, or even sheer lack of basic knowledge sometimes led to catastrophic mistakes…such as:
- Back in 2013 a user sent $1.5 million in BTC to an incorrect bitcoin wallet address due to not double-checking and verifying that the address to where he was sending was actually correct. The funds, were, of course, irretrievably lost; a particular blow, as the value of BTC itself in 2013 was relatively low, making a loss like this monetarily significant.
- Again in 2013, a number of crypto scams were in operation, where users were tricked into sending crypto to what they thought were legitimate addresses for legitimate purposes; these scam addresses were promoted as charity or fundraising addresses, but were instead ‘burn addresses’, or ‘eater addresses’, literally digital black holes where incoming funds are irretrievably locked or burned, making them unrecoverable. Up to 2025 it is estimated that around 3,200 BTC have been irretrievably lost to burner scams…equating to around $228 million of scammed funds.
- Back to more recent times, in 2017 a user accidentally sent over 800,000 ETH to an incorrect wallet address. This was entirely due to a typo, but the funds were completely unrecoverable; the monetary value in question was around $10 million. A salutary lesson in the importance of checking and double-checking a receiver’s wallet address.
- That said, in 2018, a user sent over $17 million in BTC to an address and lost it forever! So, was he a slacker who didn’t bother to double-check the address to where he was sending? Actually, not at all; he checked and double-checked before sending…unfortunately, he was sending bitcoin, but he sent it to an Ethereum wallet address which is on a completely different blockchain, has a completely different wallet address format…and absolutely is not compatible with bitcoin.
- And as we’re raising the stakes in this catalogue of errors, let’s look at a $1.5 Billion mistake in 2020. A user, wishing to withdraw his funds from one wallet, negligently sent the funds to an old and unused wallet address on Binance which had not been properly pre-verified and activated for withdrawals. This basic misunderstanding of how the exchange’s withdrawal system worked, caused a heart-stopping and potentially catastrophic error. Fortunately, the funds were recovered in due course, but it’s definitely not an experience that anyone would wish to go through.
So as can be seen, care, diligence and meticulous attention to detail are essential qualities when dealing with all things crypto…and in every aspect of life in general. Finally, let us take a look at some further mishaps, specifically to do with crypto casinos:
Winner Takes It All… The Loser Standing Small
Ok, so if you’re not an ABBA fan, you wont get it… and shame on you! But let’s start with some losers;
- A bitcoin ‘Whale’, well known within the crypto community, started making sizable deposits into a crypto casino, convinced that he would be cashing out big time. As losses accrued, he started to lay ever increasing wagers in the hope of recovering his funds, but by the end of his spree, he had lost over 500 BTC; worth 35.5 million at today’s values. The takeaway; set clear limits and don’t chase losses.
- A player on a well-known crypto casino, excited by the offer of a large welcome bonus, free spins and an additional deposit bonus, signed up immediately and eagerly started playing. Unfortunately, he failed to read the terms and conditions, which included very high wagering requirements (roughly 30 x) and a maximum bet limit which was substantially lower than the level which he had been playing at. His running strategy was to clear the bonus by laying ever larger bets, ever faster, thus breaking the casino’s terms of service. The player not only lost his bonus, but was stripped of his winnings, leaving him with nothing. The takeaway; always read the fine print.
- A crypto gambler and apparently budding mathematician, was attracted to a ‘provably fair’ game of dice. As we know, crypto casino games are provably fair, with the outcome being determined by the blockchain. With this in mind, he determined that the odds of hitting a ‘high roll’ were definitely in his favour. To that end he started to lay a series of very large bets on a series of dice rolls. Unfortunately, he had failed to account for the cumulative workings of the ‘house edge’ within his intricate formulae and ended up losing a large amount of Ethereum, The takeaway; unless you’ve got an A level in maths, don’t mess with maths!
- There’s a cost and a value to everything and failure to bear this in mind can prove costly. When a crypto casino customer deposited 10 ETH (around $4,500 at todays prices), he thought he was getting exceptionally good value once the ‘exclusive VIP’ perks were factored in. Unfortunately, what wasn’t factored in was the high transaction fees on the Ethereum network, which ate away more than 5% of his deposited funds. At the same time, ETH was going through a particularly volatile period; in fact the price plummeted just after he had deposited his funds. Several losing bets later and after taking into account the network fees, the loss in crypto value and his actual losses, the player was left with just a fraction of his initial deposit. The takeaway; keep your eye on the ball, or the ball’s likely to come flying past at a great rate of knots.
All unfortunate stories with their own salutary lessons…but just as night follows day, karma, or just luck, if you prefer, has a flipside. So let’s now take a look at some unexpectedly lucky winners.
- Crash, burn and die? Not necessarily, when a complete novice player bet an (at the time very modest in value) 0.5BTC in a ‘Crash’ game. This is a popular game to this day, where the payout multiplier increases as long as the player doesn’t cash out too late. Being completely new to the game, the player didn’t understand anything about how the multiplier increased, or anything about crypto volatility. Completely out-of-the-blue, the player somehow managed to cash out at the highest 100x multiplier turning their 0.5 BTC into 50 BTC. Simultaneously, the value of BTC increased, yielding the player a total win of around $2.5 million. The player had absolutely no idea how this all happened and could never replicate their win, in spite of repeated attempts to do so.
- Russian Roulette? Not this time! In 2013, when another complete crypto casino novice decided to try their hand at roulette, they just started to place random bets. They had absolutely no knowledge of roulette trading strategies, nor of any strategies at all for that matter. Yet incredibly, they started to win and soon their initial 0.1 BTC had grown into 30 BTC. Later, the player commented that they had absolutely no idea at all of what they had been doing nor of how how this had all happened.
- Feeling lucky Punk? Well in 2017, a happy-go-lucky punter started playing crypto casino slots, just for a laugh. He had absolutely no idea that there were even any strategies to the game and later, even admitted that he didn’t actually know how to read the paylines or win patterns. Nonetheless, with his bit-of-a-laugh attitude and playing small bets of a few Satoshis per spin, he somehow ended up with 500 BTC by the time he cashed out. The value of his walk-away winnings was around $25 million at the time!
- “Your cards are showing me a tall, dark stranger”. Well we could probably all forgo that, but I’m sure that we wouldn’t forgo the winning streak of our next player. When yet another complete novice decided to bet 1 ETH on a game of blackjack, he thought that he was just there to pass time, have some fun and probably lose. Coming from a position of not even knowing how to play blackjack, having no idea about card strategies and not even having a clue as to when to hit, stand, or double down, and despite the odds being stacked completely against him, the player somehow found himself on a winning streak, hitting a Blackjack three consecutive times and winning hands with multiple 20s. By the end, this incredibly lucky player had turned 1 ETH into 50 ETH, walking away with over $100,000 in profits.
And with that dear readers, we must finally come to the end of our sojourn to the world of interesting and obscure tales and news from the crypto and crypto casino worlds. If our journey together shows anything, it surely shows that absolutely anything under the sun is possible.
We hope that you have enjoyed being with us this week and we look forward to you joining us again next week for our usual delve into the worlds of crypto Casinos, cryptocurrencies and all things related. Until then, all of us at MegaCrypto Casino wish you all, every happiness, success and good fortune.