Hello Steem! I am the founder of Etheroll, an Ethereum based, provably-fair dice-game with 50/50 odds and a low 1% house edge. This is my story.
My story of being in the middle of my crowdfund as the DAO hack begun.
(apologies for the wall of text, this is quite the story, so get comfortable) :)
TLDR: Don't be in the middle of a crypto crowdfund for your own project, when one of the biggest crypto-currency hacks happens.
I am a developer with over 15 years experience working on clients from Microsoft to Google. I have gone from developing Flash banners back in the early 2000s that are required to be under 20kb with an enormous amount of animation in them, all the way to major campaigns for Microsoft (including the first live streaming event using Silverlight (hmm) in Australia for a Steve Ballmer conference (that was a nerve-wracking day, but not as nerve-wracking for me as the story I am about to tell you).
I think it is time to share my story...
I love code. I love blockchain-centric code even more. Nowadays, it is probably the only thing that really gets me out of bed in the morning. An obsession.
I remember reading a random post on reddit.com about Ethereum back in about January 2016. From the moment I read about its capabilities with the use of smart-contract code, I was hooked.
I remember staying up that entire night sifting through the various forums, tutorials to learn as much as I could about the new programming language Solidity. I learnt it was based on Javascript, something I am well familiar with.
BAM!
That was it, I knew I had to do something in the Ethereum space. So, I started to think - what do we have here?
Well, in its most basic form, we have the ability to transfer value globally and instantly, sure, Bitcoin already offered this, but what Bitcoin could not offer at the time was the ability to transfer value, that could be mandated by a strict set of rules as defined in a smart-contract.
The cogs started to turn.
I started to research what Dapps already existed in the marketplace, no point in creating something that has already been built and on a path to success. There were some interesting concepts being explored. The DAO, Augur were probably the two that caught my imagination the most. Augur. A prediction based market, based on real life events.
Hang on!!
What about non 'real life' events? What about a market that allows users to wager on the outcome of a random number?
Random number generation is difficult in computing, and almost impossible on a deterministic platform such as a blockchain. Any random number generated on chain, could be withheld by a miner, if the RNG did not suit them, a miner would have a second chance at 50/50. Not acceptable.
I spent months researching how to overcome this problem. Tried many different methods, failed many different times. In the end, I decided to use an oracle for random number generation - oraclize.it is a fantastic way to pull in data on chain.
RNG on the blockchain really deserves its own post. I may write one later.
Back to the story...
I (used to) like to play Blackjack. It was my game. Perfect strategy. I drive my friends crazy, because I never falter from the perfect strategy game in Blackjack.
The pieces started to come together in my mind. I started to research Bitcoin gambling websites and happened across Satoshi Dice. Erik Vorhees sold Satoshi Dice for $12m. That was inspirational to me.
Satoshi Dice is a simple dice-game, but the most popular of all gambling applications within the Bitcoin space. In fact, dice-games are the most popular crypto game of all.
Some $$ numbers
http://etheroll.wordpress.com/2016/02/23/some-numbers/
Users wager on the outcome of a dice roll, and can set their own odds, genius.
Watching the amount of action at Satoshi Dice, I knew that Ethereum now presented opportunity to port this style of game over to Ethereum.
But why?
Dapps (decentralized applications) in Ethereum are open-source. This means, anyone can view the code that runs a Dapp. In my mind, this meant I could create a dice-game that would be provably-fair! Players would be able to peruse the code (if they so wished), and would know that the house was not being shady and altering the odds or outcomes of each dice roll. For me, as a player with much online gambling experience, that was always something that sort of bothered me with a loss. I never really could trust that the online casino was in actual fact - fair.
For the next 3 months I studied Solidity code. I mean, I did nothing other than teach myself the nuances of this new and (to me) terribly exciting platform for probably 8-10 hours a day on top of my normal day time job.
It was all trial and error. With Ethereum, there is a test blockchain, so that developers can test their Dapps, without spending real Ether (the cryptocurrency used within Ethereum). This blockchain is called Morden.
I made so many tests, my Ethereum address was the most 2nd most used address on the Ethereum testnet blockchain. You can still view that stat here (it is still the 3rd most used address lol): http://testnet.etherscan.io/accounts?sort=txcount&order=desc
That link sorts addresses, by the number of transactions on the Ethereum testnet blockchain.
Mine is currently the third most active account - that is a lot of testing. Address 0x910ca8702e41f46c4bf5b801e1b70f2ffca9d0fe - it has over 151026 txns + 81084 internalTxns and I have created over 500 smart contracts lol (don't worry, I cleaned up after myself and deleted most of them).
I was on a mission. I wanted to create the Satoshi Dice of Ethereum and I was not going to stop until it was working.
Weeks passed, months passed, seasons passed, I kept working at it.
Finally, I was happy with my Dapp. It worked! It worked beautifully!
Users could pick a number between 1-100, place a wager that they were comfortable with, and if the result was within the range they picked (either high or low range) they won!
If a player bet 1 Ether, they would receive 1.99 Ether. A 1% house edge. I had to remain competitive against the likes of Satoshi Dice. Players don't really care about much, other than the house edge, that is what attracts a player to a game. I had little overhead, and I knew I could offer this house edge.
I presented the game to reddit. It was accepted well. Really well. Within 3 hours of my first post on reddit, I had an investor wanting 12.5% equity in the project for 800 ETH. I agreed. We made the exchange. This first investor was to receive 12.5% of all future profits etheroll.com was to make. I was happy, things were chugging along nicely.
Then more $$$ offers came. Big offers. Really big offers.
Really, really BIG offers.
In the past 6 months I have been offered about $12m USD in various forms of equity partnerships and so-forth. Some people wanted a full licensed operation. I hired lawyers. Expensive laywers. $1000/hr expensive lawyers. I explored licensing from the Isle of Man - I explored licensing in Panama, Costa Rica etc etc.
Things were getting crazy, but this was it, it was my hobby. It was not work, I loved every second of it.
But I had a problem. To run the application in a 'live' state, I needed Ether to pay out winners. I didn't want to give away a whole lot of equity (thanks Zuck) so I started to look at other options.
Inspiration
Then the DAO crowdfund came along. Wow. I watched in awe. This was the answer.
So, back to the drawing board. I learnt how to code a complicated crowdfunding campaign in Solidity. The nuances of the campaign took months for me to work out. My best friend, who joined me in the early days of Etheroll came on board as advisor and co-founder. We would spend all night going over the particular nuances of the crowdfund, how to run it, when to run it, the code, the social media aspects, the support to potential investors. Hours and hours of meetings between ourselves late into the night.
At this point we had over 250 emails from investors wanting in on our project, in various amounts, ranging from 1ETH to 10,000ETH. By the time we launched our crowdsale, interested investors had indicated our crowdfund would raise ~$4m USD.
Exciting times
Finally, we were in a place where we could set a date for our crowdfund - June 13th @ 10:00 UTC.
You can view the details of our token sale here:
http://etheroll.wordpress.com/2016/05/30/announcing-the-etheroll-token-sale/
I remember pushing my best friend and co-founder for an extra week lead up time to our crowdfund. We debated on this for a few days. If only I did not push for that extra week. Things would have been so different.
Momentum started to pick up even more from here on, until eventually the date came.
The crowdsale was an immense success, 898 ETH in the first 24 hours:
http://twitter.com/etheroll/status/742655654834241537
1000 ETH in the first 24 hours:
http://twitter.com/etheroll/status/742777927138312192
We cracked the top 15 crypto crowdfunds in history not even 48hrs into our crowdsale. WOW!
http://twitter.com/etheroll/status/742876253775007744
Disaster strikes
3 days later, on the 5th day of our crowdsale, still with 9 days left to run, The DAO hack.
Ouch. Talk about a dent in optimism. ETH price halved in the space of 12hrs or so. How the hell did the DAO get hacked? What was going on? Are we under the same threat??
I started an immediate 'emergency security audit' of our code, in light of the news of the DAO hack. This was smack bang after the most intense lead up campaign I have ever run in my life. I slept probably, at most, 1-2 hours every 24hrs. Not a good combination when there is ~$50,000 USD of other peoples money at stake.
I decided to halt the crowdsale, get some rest, and work out what the hell was going on:
http://etheroll.wordpress.com/2016/06/17/critical-update/
This was my response:
http://etheroll.wordpress.com/2016/06/18/crowdsale-now-closed-eth-has-been-refunded/
In the end, we were not open to the same attack vector that the DAO was, but there was a slight edge-case chance that we had a security vulnerability.
That was it. I had no choice but to refund the 2326 ETH that was raised. There was no way I was going to put other peoples money at risk, not in the situation we were facing at the time.
In the end, I am glad I chose to refund my valued token holders, it was without a doubt the right decision to make.
Since June, I have been taking a breather from Ethereum and Solidity coding (excluding the immediate weeks following the DAO hack - learning more new idealogy about security measures within Ethereum).
Now, in August, I think I am ready to breathe life back into Etheroll. I believe I can make this into the Satoshi Dice of Ethereum. I won't give up, but I am going to need the same support that we saw back in June.
Ethereum, are you still down? ♪ ♫ ♬
Is the Ethereum community still backing us? Time will tell. In the meantime I have created a poll on reddit to gauge interest in a round #2 crowdfund here:
http://www.reddit.com/r/ethereum/comments/4yp4hv/would_you_be_interested_in_round_2_of_an_etheroll/
Perhaps you would like to cast a vote if you have a spare moment, and let me know what you think we should do? It would certainly be helpful for me to know what you think.
In any case, I would just like to thank everyone in the Ethereum community for your support, patience and understanding over the past few months. It certainly has been a valuable experience for me in regards to how to run, manage and handle a crowdfund, plus just what the hell to do when it seems everything goes just so completely against you.
I think the biggest take away for me in this whole situation is, it is not how you handle the situation when you are a success, that is 'easy'. To me, what is most important about your character, is how you handle the situation when things go completely and utterly $#*&))#% wrong.
In the end, after all the millions of dollars that had been offered to me in the past 6 months, I ended up with 0. Nothing, zip, nada. In fact, it had cost me my job, part of my sanity, and lots of my own $$.
But that is ok. I consider the learning and growth period I went through in this phase to be invaluable, incalculable. Also, things happen for a reason. I truly believe that. So keep your head up, no matter what. If you are trying to snag a whale, or date that girl - whatever it is, keep at it. The stars will eventually align, I promise you. You just gotta' keep the faith, and believe in yourself.
Currently, the site is not up and running, I have been considering my next moves. Until now.
Even though I failed in my previous attempt, I will pick myself up, dust myself off, and try again.
I hope to see you all around on Steemit in the near future and that you may have enjoyed my story as much as I have been enjoying all of yours.
Here is to the future!
Kind regards,
James | Founder
ΞTHΞROll
T: @etheroll
#steemit #ethereum #steem #bitcoin #money
p.s - how would one verify I am who I say I am here? Thanks!
This was hugely positive for you. If the Crowdfunding campaign had succeeded you might have been in jail by now for offering illegal gambling. If not yet, it would be rather soon. Now you still have the option to turn your skills to something creating value that will also be legal.
Thanks for your support. However, my website operates from Panama, a jurisdiction which considers online gambling to be perfectly legal.
The situation with online gambling is, it does not matter where you operate from, an operator of an online casino still needs to respect local laws of its players (hiring $1000/hr online gambling specialist lawyers gets you this sort of information).
Thus, by restricting access to players from countries such as the U.S and Australia, country based IP restrictions can be an effective pro-active measure one can take to respect those local laws, much in the same vein as Satoshi Dice.
Remember, we do not live in 'planet USA' and actually, online gambling is legal in many jurisdictions, all across the globe. Also, I am not a US resident, in fact, I am Australian, and Australians are allowed to operate an online casino, just as long as the product is not offered to Australians, and I respect local laws all across the globe, as I had previously mentioned. ;-)
Not to mention, Bitcoin is not money.
However, yes. I am trying to port my skills over into something more suitable, like a de-centralized Uber, or the like.
Again, thanks for your support, and I appreciate your concern (this is my other account).
p.s Are you the European gentleman that contacted me previously via email regarding this issue re etheroll? Your name looks familiar. ;-)
Ha, yes, I am the one who has already contacted you about this. Thanks for your answer here. Very productive.
I agree that not serving the U.S. helps a lot in not landing in jail. Still, in all other jurisdictions you also need a license to operate. And since your identity can easily be looked up (I think it is not the case for Satoshi dice), that makes law enforcement easy. It needs just one country deciding to put an end to it and asking Australia's police to go and get you.
It will also not help to operate from Panama. Law in nearly all countries look at point of consumption and not at point of service.
(You paid $1k/hour for advise on this? I receive way less to educate those lawyers via articles and talks. I am clearly on the wrong side of the industry as a researcher.)
I will be restricting access to all countries via IP that do not allow online gambling without a license. Also, the site is not even up and running, it has all been only testnet Ether, which certainly holds no real value. So absolutely 0 laws have been broken.
Yes. Thus, country based, blanket IP restrictions.
I am currently looking to let go of the website, domain, and all IP as well. As I have suggested previously, I am looking into other opportunities.
p.s regarding the $$$ lawyers. I have some very good legal contacts here in Australia, if not the world. Those are base market rates. I do not pay market rates. ;-)
Not serving countries where a license is needed will certainly keep you out of jail (you would not have needed a lawyer for that; that is what I wondered about, not the rates but that you pay them). The problem is, that not serving these countries will keep you out of all lucrative markets. So it is either operating illegally with profit or legally without profit.
Selling sounds like the best option. Good to hear that you think about moving on.
so, remind me again, about how the gummint is protecting us from bad guys?
It's a good reminder for me why I don't want to get into this kind of business. I prefer to do something no law exists for anywhere. Then after the profits roll in, and trolls pop up trying to misinterpret laws to get a piece out of me...
oh yeah! bring it baby! Not only will there be the expensive lawyers specialised in the jurisdiction, there will be me running the campaign to squash these roaches.
I am not a vindictive person but if I'm doing something, and clearly by its' earnings, a lot of people like it, i would be very happy to not just own every troll's house, car and savings acconut, i'll make their relatives want to disown this pos as well.
I invested in etheroll before the refund, was my inspiration for buying the steemroll.com domain. nice to have you here, cheers
Awesome! Thanks for your support! Glad to hear you got your refund all ok back then from us too.
We are considering round #2 crowdfund, so keep an eye on us http://twitter.com/etheroll if you are still interested.
Followed. :)
Any plans on opening it back up?
Thanks for sharing this information, I like what you posted. if you want you can visit my blogg you, follow or comment voting share with your friends, Thanks
Thanks!
Man if you can apply this to blackjack.....etc...Ooh Lawd
Talk about taking a leap! We're right behind you, aligning stars one at a time. Long live crypto!
@etheroll Man I was reading your story after playing some dicing game online and searching eth dice and your topic showed up.. I like how you handled the situation and I was feeling good energy towards you while reading, I was scrolling down....saying good things in my mind,, AND BOOM ! there I see the picture of tupac ! ME AGAINST THE WORLD NIGGA!
I literally had goosebumps, the reason is only understood at the moment by God and me ..
I was raised and educated by pac's philosophy and music.
Respect man, for your work and motivations, and no matter how rough things get down the road man, remember this:
"you gotta find a way to survive, cause they win when your soul dies!
Man, this is such an inspiring story. I guess the majority of people won't understand the kind of passion and excitement you had back in the days. Good luck, Etheroll!
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