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To simplify, why bet when the winnings are tiny. There's other things you could do with that money.



Sure, but that’s a cost of capital discussion not a “fees are higher for bets with higher likelihood of winning” one.


It’s related. Your actual gains = (Fee * winnings ) - opportunity cost.

The effective withdrawal fee is 1 - (actual gains / ( winnings - opportunity cost)).

So if the actual fee is 10% your winnings are 2$ and your opportunity cost is 1$ them the effective fee is 20%. In other words a 10% withdrawal fee dropped your actual gains from 1$ to 80 cents.

However if your winnings where 1,000$ then your effective withdrawal fee is 10.01% dropping your actual gains from 999$ to 899$. In other words fees are more impactful on high probability bets than low probability bets.




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