Online Betting: The Next Big Exit Scam

Azor Ahai

Village Sponsor
#1
We saw Gakuyo, Nakumatt etc all blow up in our faces. We are about to see a big one from one of the betting companies soon. Reason?? All the ingredients for an exit scam are present. An exit scam, by definition, is a confidence trick when a business with good reputation continues to receive money from customers but ceases to offer services or ship goods. It mostly happens when there is a dramatic shift in an industry or when directors have so much money on their hands that it is easier to just steal it than to work honestly and earn it in 20 years. It starts as an honest business, gains a good reputation, directors get greedy, payments start being delayed due to cashflow problems, eventually the scam blows up when the center cannot hold. In any loosely regulated business, when directors have too much money in their hands that they can't earn honestly in decades, an exit scam is hatched. In fact, most exit scams begin as honest businesses.
Back to betting:
Betting companies operate somewhat like banks. They receive deposits from low IQ bonobos and issue out payments to the few lucky ones. They are likely to do what banks do which is to operate on fractional reserves. Managers can give a rough estimate of an amount that the company has on hold during any random time. They can also estimate how much they actually need from that money to pay winners without going broke or raising an alarm. When you subtract both figures, you get the amount that directors can pocket/steal without affecting payouts. For example, if a company always has a minimum balance of 10 billion on its accounts, but needs just 3 billion to pay winners, directors can steal 7 billion and nobody would be non-the wiser. A problem arises when there is an abnormal event that forces customers to withdraw money en-masse from the platform. That's when the cookie crumbles. Right now, The Man has asked people to withdraw money from these betting platforms on short notice because M-pesa etc payment channels will be disabled. It is similar to a bank run. Now, directors will face that problem where more money is being demanded than what they already have. If the government's directive is true and implemented, I expect seeing complaints everywhere on social media from low IQ bonobos unable to withdraw their money. What you see online isn't money, those are just numbers on a screen. This event will expose the true nature of online betting companies in Kenya.
In the near future, one online betting company will go under with a lot of money from peasants. Gakuyo did it, Nakumatt did it (money from banks, suppliers and landlords) and one or more betting companies will do it soon.
NB: If your favorite betting company starts delaying payouts, those are the first signs of the end. You have been warned.
 
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Touchlyrics

Village Sponsor
#2

Azor Ahai

Village Sponsor
#3
Hii story yote umeandika ni umeffi! Those betting firms dont hold anybodies money or property, u lose a bet the money goes. Your comparison of betting firms na Gakuyo just shows how stupid this article is in terms of research.

Enda hii thread uelewe why these gambling firms are being fought. New money vs Old Money

https://www.kenyatalk.com/index.php?threads/why-gambling-is-being-fought.116090/#post-2300825
You are one of the low IQ bonobos that I am talking about. You didn't even understand the post before rushing to comment. Anyway, who holds your money after you deposit but before you place a bet??

This post is too complex for a low IQ bonobo like you to understand.
 

FieldMarshal CouchP

The Oracle of Ndeiya
#10
We saw Gakuyo, Nakumatt etc all blow up in our faces. We are about to see a big one from one of the betting companies soon. Reason?? All the ingredients for an exit scam are present. An exit scam, by definition, is a confidence trick when a business with good reputation continues to receive money from customers but ceases to offer services or ship goods. It mostly happens when there is a dramatic shift in an industry or when directors have so much money on their hands that it is easier to just steal it than to work honestly and earn it in 20 years. It starts as an honest business, gains a good reputation, directors get greedy, payments start being delayed due to cashflow problems, eventually the scam blows up when the center cannot hold. In any loosely regulated business, when directors have too much money in their hands that they can't earn honestly in decades, an exit scam is hatched. In fact, most exit scams begin as honest businesses.
Back to betting:
Betting companies operate somewhat like banks. They receive deposits from low IQ bonobos and issue out payments to the few lucky ones. They are likely to do what banks do which is to operate on fractional reserves. Managers can give a rough estimate of an amount that the company has on hold during any random time. They can also estimate how much they actually need from that money to pay winners without going broke or raising an alarm. When you subtract both figures, you get the amount that directors can pocket/steal without affecting payouts. For example, if a company always has a minimum balance of 10 billion on its accounts, but needs just 3 billion to pay winners, directors can steal 7 billion and nobody would be non-the wiser. A problem arises when there is an abnormal event that forces customers to withdraw money en-masse from the platform. That's when the cookie crumbles. Right now, The Man has asked people to withdraw money from these betting platforms on short notice because M-pesa etc payment channels will be disabled. It is similar to a bank run. Now, directors will face that problem where more money is being demanded than what they already have. If the government's directive is true and implemented, I expect seeing complaints everywhere on social media from low IQ bonobos unable to withdraw their money. What you see online isn't money, those are just numbers on a screen. This event will expose the true nature of online betting companies in Kenya.
In the near future, one online betting company will go under with a lot of money from peasants. Gakuyo did it, Nakumatt did it (money from banks, suppliers and landlords) and one or more betting companies will do it soon.
NB: If your favorite betting company starts delaying payouts, those are the first signs of the end. You have been warned.
I agree with you entirely. Don't bother with the basement-level IQ baboons; hata Gakuyo uliona wakim-defend before shit hit the 'fun'.

But please credit me for coining the term "low IQ bonobos/baboons".:D:D:D:D:D:D Tuko na nyingi sana hapa..................
 

upepo

Village Elder
#11
We saw Gakuyo, Nakumatt etc all blow up in our faces. We are about to see a big one from one of the betting companies soon. Reason?? All the ingredients for an exit scam are present. An exit scam, by definition, is a confidence trick when a business with good reputation continues to receive money from customers but ceases to offer services or ship goods. It mostly happens when there is a dramatic shift in an industry or when directors have so much money on their hands that it is easier to just steal it than to work honestly and earn it in 20 years. It starts as an honest business, gains a good reputation, directors get greedy, payments start being delayed due to cashflow problems, eventually the scam blows up when the center cannot hold. In any loosely regulated business, when directors have too much money in their hands that they can't earn honestly in decades, an exit scam is hatched. In fact, most exit scams begin as honest businesses.
Back to betting:
Betting companies operate somewhat like banks. They receive deposits from low IQ bonobos and issue out payments to the few lucky ones. They are likely to do what banks do which is to operate on fractional reserves. Managers can give a rough estimate of an amount that the company has on hold during any random time. They can also estimate how much they actually need from that money to pay winners without going broke or raising an alarm. When you subtract both figures, you get the amount that directors can pocket/steal without affecting payouts. For example, if a company always has a minimum balance of 10 billion on its accounts, but needs just 3 billion to pay winners, directors can steal 7 billion and nobody would be non-the wiser. A problem arises when there is an abnormal event that forces customers to withdraw money en-masse from the platform. That's when the cookie crumbles. Right now, The Man has asked people to withdraw money from these betting platforms on short notice because M-pesa etc payment channels will be disabled. It is similar to a bank run. Now, directors will face that problem where more money is being demanded than what they already have. If the government's directive is true and implemented, I expect seeing complaints everywhere on social media from low IQ bonobos unable to withdraw their money. What you see online isn't money, those are just numbers on a screen. This event will expose the true nature of online betting companies in Kenya.
In the near future, one online betting company will go under with a lot of money from peasants. Gakuyo did it, Nakumatt did it (money from banks, suppliers and landlords) and one or more betting companies will do it soon.
NB: If your favorite betting company starts delaying payouts, those are the first signs of the end. You have been warned.
Ile kitu najua ni moja. Hakuna bonobo inaweza tulia two hours ikiwa na winnings kwa account. Either they re-invest the funds immediately or withdraw for use in other vices.
 

Azor Ahai

Village Sponsor
#12
Ile kitu najua ni moja. Hakuna bonobo inaweza tulia two hours ikiwa na winnings kwa account. Either they re-invest the funds immediately or withdraw for use in other vices.
True. But there will always be idle cash kwa system. Kuna pesa iko kwa account but gambler hajabet nayo. Kuna msee hajawithdraw winnings bado akingoja the next game awekelee tena etc. Sasa, imagine waanze kukuwa na time lag ya kuwithdraw...si hiyo amount inadouble?
 

Sambamba

Village Sponsor
#13
Umeandika nonsense nyingi sana M2Random.You clearly don't understand how betting companies work .Wacha nikuelimishe
-When you place a bet ,you don't bet against the betting company ,you bet against fellow gamblers .
-Betting companies protect themselves with odds .Eg if you toss a coin ,chances of landing tails or heads is 50/50 or 0.5 .A betting company will however give you odds of .55 percent on tails to entice you and .55 on heads total 110% .That 10% is the margin .
-Betting companies make money from casual gamblers who don't understand mathematics of betting and thats why if they spot a professional who limas them a good one ,the quickly limit him .
-The nature of betting is that more people lose than win so its a very liquid market .Unless you find a situation whereby a syndicate nyoroshas a betting company a good one(I know one that was making 40M a month from sportpesa) ,it's very difficult for many not to fulfill their financial obligations
 

Touchlyrics

Village Sponsor
#14
si hiyo amount inadouble?
So within that time lag ya lets say one day wameshikilia hizo pesa za watu, how will they earn from it? Watanunua T-bills za One day?

Betting firms are not banks to make interest with idle cash. It is in their best interest for the wallets to be empty, not vice versa.

Clearly huelewi how gambling firms operate.
 

Azor Ahai

Village Sponsor
#15
Umeandika nonsense nyingi sana M2Random.You clearly don't understand how betting companies work .Wacha nikuelimishe
-When you place a bet ,you don't bet against the betting company ,you bet against fellow gamblers .
-Betting companies protect themselves with odds .Eg if you toss a coin ,chances of landing tails or heads is 50/50 or 0.5 .A betting company will however give you odds of .55 percent on tails to entice you and .55 on heads total 110% .That 10% is the margin .
-Betting companies make money from casual gamblers who don't understand mathematics of betting and thats why if they spot a professional who limas them a good one ,the quickly limit him .
-The nature of betting is that more people lose than win so its a very liquid market .Unless you find a situation whereby a syndicate nyoroshas a betting company a good one(I know one that was making 40M a month from sportpesa) ,it's very difficult for many not to fulfill their financial obligations
Betting companies receive deposits and withdrawals, exactly like banks. Any company that receives deposits and withdrawals can operate on fractional reserves and experience a run exactly like banks. It wouldn't be hard for a betting company to implement an exit scam because most of the money is already out anyway except the fractional reserve. When they are ready to close shop, they would only need to make withdrawal times longer and depositing easier to eventually vamoose with the accumulated money. An easy way would be to hit all big winners with KYCs before they withdraw.

I can say this with confidence. If all gamblers withdrew every shilling they have on online betting platforms in the next 24 hours, most of the companies wouldn't have that cash. That is what fractional reserves mean. They would stop withdrawals instantly because they wouldn't have that money.
 
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Pangakutu

Village Elder
#16
i never knew how much these guys make until i saw withdrawals from a casino,on one machine deposits by customers was 600k na withdrawals was 300k,i saw like three and they were all ranging hapo.the place has like 100 machines,so do your math
 
M

Mine_rva

Guest
#17
This post has 100% confirmed to me that you're indeed @M2Random. The only villager who knows everything :D:D:D

Betting firms are just platforms that allow people to bet against each other albeit virtually. If you place a bet say X, you've staked against all the 1s and the 2s.

On the issue of KYC, you can't conduct something that you didn't do at the beginning of the businesses. Banks do it during business transactions coz that's they already conducted it at the time you were opening your account.
 

Brayo44ki

Village Sponsor
#20
Enlighting article, it's true the evidence of a decaying economy is a thriving gambling firm.

Understandably economies aren't calculated per head rather a sum of all citizens, this provides a vicious cycle for the rich getting fatter on payments from the scrawny peasants.

This was a worthwhile read, good stuffEnlighting article, it
 

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