This combined with the fact that you can only lose what you have but win a lot more makes it the smart thing to do

I assume this was probably a joke, but just to clarify for anyone unfamiliar with the idea: there is a concept in probability called expected value, which estimates the average outcome of a random event over many repetitions.

If the expected value of a gambling game is 0, the game can be considered fair: on average, you neither win nor lose money.

If the expected value is positive, the game is biased in your favor: over time, you would expect to win more than you lose.

If the expected value is negative, the game is biased against you: over time, you would expect to lose more than you win.

Expected value is calculated by multiplying each possible outcome by the probability of that outcome, then adding the results together. For example, suppose you bet 10€ on a coin flip. If you win, you receive 10€ in profit; if you lose, you lose your 10€ bet. With a fair coin (probability to get each side with a 50% probability), the expected value is:

0.5 * 10 + 0.5 * -10 = 0

So this game is fair.

But if you only win 8€ when you guess correctly, while still losing 10€ when you guess incorrectly, the expected value becomes:

0.5 * 8 + 0.5 * -10 = -1

That means you lose 1€ on average each time you play.

Most casino games, sports betting markets, and similar gambling systems are designed to have a negative expected value from the gambler’s perspective. In other words: statistically speaking, the house wins in the long run, and the player loses.