Block and Digit Cyniper
to Block and Digit Cyniper, a bi-monthly publication devoted to
analyzing the ruthless art of winning NameBase auctions for the least
amount of money.
Otherwise known as "sniping". Snipers are despised and hated in war, but they are used by everyone, on all sides, in every conflict. It is much the same with electronic auctions. While many people consider auction snipers to be an affront to decency, they are an unavoidable part of all open auctions and actually have an important role to play. More to the point, sniping auctions is a lot like sex, everyone does it, but not everyone talks about it.
are solidly in the do it and talk about it group!
and Digit Cyniper
(issue#1, 2nd half of July 2021)
NameBase (NB) sniping is a little like chess because there are elements of skill, luck, gut feeling and strategy involved in both. Needless to say, understanding the rules for both games are crucial. So let's cover two of the most important rules for NameBase and strategies to deal with them - Auction End Times and Vickrey Rules.
(Highest Bid Always Wins, But ....)
At the final end of an auction the highest bidder always wins, but with NB auctions, when the end of an auction actually happens can be difficult to understand and almost impossible to predict. This is for two reasons -
The Handshake blockchain is suppose to, on average, process a new
block about every 10 minutes. However, due to several factors,
currently several blocks at a time can come through in a matter of
seconds like a freight train or a single block can sit and hold
everything up for over an hour or more (examples - *1). This
blockchain "slip" time is the biggest variable for when an
auction will actually come to an end.
2) A smaller, but equally unpredictable variable for the finish time of a NB auction is how fast or slow NameBase transmits your bid. As a sniper, it is very important to understand that NameBase does not transmit a bid immediately. This is why next to bids on a running auction you will see words like, "TX #", "MINED", "SENT" and "SCHEDULED", which indicate how close a bid is to being officially registered on the Handshake blockchain. "SCHEDULED" is the word you don't want to see because that generally means your bid has not been placed yet.
** Until fairly recently, these indicators and their times were meaningless and could not be trusted to be correct. Lately, they seem to be more accurate, but NB is famous for putting out flashy details, which at least initially, are completely untrustworthy. To be safe, do not put a lot of faith in this information.
So these two wild cards, Block Slip Time and NB Transmission Time, usually dictate how close you can reliably predict the end of an auction in order to snipe it and get the very last bid.
The tricky one is the NB Transmission Time. This is because your NB account can actually show your bid as the high, winning bid on an auction as it finishes and officially goes to reveal. You can be cheering for a couple of hours (or about 20 blocks) thinking "I won, woohoo I rock!" then suddenly, without fanfare, see your bid disappear from NameBase - and you go from hero to zero. This is NameBase's way of saying, "You bad boy, you waited until the very last minute to bid. We tried our darnedest to send your bid, and it really, really, really looked like we got it in there on time, but nope, I guess we didn't - sorry".
NB Transmission Time is constantly fluctuating because it is dependent so many different things. The only way to gauge it is to place a few last block, last second throwaway bids on auctions with a lot of bidders and use a block explorer to see if your bids are actually getting on the blockchain. One of the most reliable Handshake block explorers at the moment is hnsnetwork.com. Just wait until the "Auction State" shows as "REVEAL" for a particular domain name that you have bid on then you will know if your last second snipe made it or not.
Block Slip Time can also be easily seen on hnsnetwork or any Handshake block explorer. You can find blocks that have slipped quickly in the list because they will have low size and transaction counts. For snipers, finding a pattern to block slip times would be a like knowing where the ball is going to stop on the roulette wheel at Vegas - it would give you a huge advantage. We have yet to see a consistent, predictable order of times, but that doesn't mean there isn't one. It should be noted that miners are obviously the major controllers of block slip times and since Handshake is so new, it currently has a low mining capacity which makes this important variable vulnerable to gaming. One odd thing is that it is not unusual, at least on hnsnetwork, to see is negative slip times. We have yet to hear a good explanation for this block timetraveling effect.
(Vicky rules my world)
Hopefully you've heard that NameBase auctions are based on a type of sealed-bid auction called a Vickrey auction. You can read more about Vickrey details on the NB learning pages or Wikipedia. For snipers, the most important point about this kind of auction is that winners pay the second highest bid, not the high, winning bid. This fact has consequences because (1) it affects how some auctions are structured and (2) it gives snipers an advantage when consistent blind bidders operate for a long period of time.
Auctions structured with second bids (Self Counterbid)
A common strategy used by auction creators to ensure that they pay the minimum amount to win a domain name, while at the same time fending off other bidders, is to open an auction with a very low bid, say the minimum for NB of 0.40 HNS. Then, at some point near the end of the auction, but before any competing bids have been placed, the auctioneer will place a second very high bid on their own auction. This works because all bids are anonymous so no one can see that both the low starting bid and the very high 2nd bid are from the same person. To most bidders casually looking at one of these Self Counterbid auctions, the sky high bid makes it look like somebody really wants this auction and so scares most people away. Of course, when the auction closes and goes to reveal the auction creator only pays the 2nd highest bid - the minimum (0.40 HNS).
These Self Counterbid auctions are relatively easy to see because there will be a clump of similar auctions in the NB "Ending soon" list all with the very same low starting bid and a high 2nd bid that never changes or only varies a little bit. The high 2nd bid can be differentiated from an actual, regular bidder high bid because the Self Counterbid high bids are usually placed all at the same time and are not too close to the auction end. It can take some time looking at auctions to recognize these at first, but they become pretty easy to spot after a while.
Once you realize someone is Counterbidding their own auctions, they become vulnerable because if they are opening a large set of auctions it is usually too expensive for them to place full, real bids for the 2nd high bid. This means their 2nd high bid will have a blind, and if there are a lot of auctions in the set, it will usually be a large blind.
Up to now, it has been the science part of sniper science/art. Once you know an auctioneer is Counterbidding with a big blind, it becomes the art side and it is time to use a Jedi mind trick, an educated guess or whatever to come up with a idea about the real bid amount of the 2nd high bid. You will then bid under their 2nd high bid lockup with a simple, real bid (no blind) that will (hopefully) win the auction.
A bid that has a lower total lockup that is less than the high bid, but still wins an auction after reveal, is called an Underbid. When this auction hat trick is done successfully, it makes you look like you are part Sean Connery and part Albert Einstein with a dash of Wonder Woman thrown in. The nice thing is that this will put 3 bids on the auction and so usually keeps bargain hunters and other bidders away. And because you are sniping at the last minute (you are, aren't you?), even if the original auction creator sees your underbidding they most likely won't have time to transmit a bid to defend their auctions.
Here are just two recent examples of successful Underbids on a large set of 4 character Self Counterbid auctions -
(see img1, img2 below)
Both of these Self Counterbid auctions used a 2nd high bid of 30 HNS as lockup with a heavy blind of 23.99 HNS. Notice the 2nd high bids were placed early, the day before.
Consistent blind bidders (lazy-blind-bidders)
This is not as common as it used to be, but many people are lazy and will repeatedly use the same blind in a bid/blind lockup. They of course are just doing a standard blind bid by putting down a very low actual bid with a larger blind to cover it up. The crucial part is here is that they place the same bid/blind lockup for a long period of time (more than 14 hours).
One of the most common lazy-blind-bidders are bots. This is because it is far easier to program a bot to use the same lockup repeatably than it is to have it generate random looking bid lockups. And while we use the word lazy here, that's not really fair. If a lockup with the same blind is working over and over again for a bidder, why would you change it? Humans have a natural drive for efficiency - getting the most amount of stuff with the least amount of work. Even a bot getting only 20% of what it automatically bids on makes its creator happy if that is 20% of thousands of auction. And if an eagle eyed sniper can grab 5% of those auctions from the bot, then the sniper wins too.
When you know how much a bidder is consistently using for their blind in a lockup, this means they have a "blind tell". If their total bid lockup (bid and blind together) is also a consistent, unique number that stands out then they can be spotted everywhere they bid. For example, let's say someone is bidding with a total lockup of 10.75 HNS. Secretly, however, their actual bid is only 0.75 HNS and their blind is 10 HNS. Once you know this, you simply come behind them and place a bid with an actual bid of 0.76 HNS and a blind of, for example, 39.24 HNS for a total, public lockup of 40 HNS. Any other bidders go away after seeing your 40 HNS high bid, but when you win the auction you only pay the 0.75 HNS of the lazy-blind-bidder.
people will say, "Well duh, of course if it was possible I would
find out somebody's blind. But you can't do that because you have to
wait 10 days for reveal!"
You do not have to wait 10 days and so it is possible because -
#1 It is very time consuming for someone bidding on a large number of auctions to constantly change their blind and lockup amount, so many times they don't bother.
#2 On Namebase, in most cases, you can find out what someone is using for their blind. Instead of 10 days, wait about 14 hours, or around 82 blocks, after the close of an auction you have placed a bid on. Then look in the NameBase "Bid history" of the TLD and you will see the "Bid amount + added blind". That's all you have to do to see what kind of blind someone is using. Again, this strategy only works for people using the same blind/lockup for at least 14 hours (see *2).
this issue we've covered how NB snipers can use certain strategies to
deal with Auction End Times and Vickrey Rules to give them a possible
advantage in winning auctions.
However, even a huge amount of technical strategy is no match for a single human who has a raw talent for just "knowing" the correct answer. Human beings have massive parallel processing brains that can be very good at coming up with gut feeling answers which are consistently correct. A great example of this was how long it took chess programs to finally defeat humans playing games like chess and go. Frankly, because these two games have rigid rules with a large, but limited, number of possible moves, humans should of never had a chance against even the earliest computers. Legendary players like Garry Kasparov were able to win for so long because not only did he know hundreds of strategies and have years of experience, most importantly, he had a undefinable, almost supernatural feel for making the right move at the right time.
The same can be said of sniping on NameBase, when after countless hours of watching auctions, you just have a feeling for what another bidder is doing and you make a winning Underbid. This is what we like to call a Grok Underbid. A Grok Underbid is the most impressive type of auction bid because it is a shoot-from-hip, ballsy underdog win that is against the odds and doesn't depend on strategy or technique. Here are four examples of "Hail Mary Pass" Grok Underbids that paid off -
(see img3 - im6 below)
In the last two cases, the winning underbidder had no indication or clue at all that the reasonable starting bids of 24 and 30 HNS were heavily blinded. Instead, the winner just went with his gut and threw out a Grok Underbid that captured both auctions. That is how a "natural" can use instincts and feel to win at the art of sniping. With enough practice and experience, almost anyone who puts in the time can become a natural sniper.
That's all for this issue of Block and Digit Cyniper, see all you snipers next time on top of the reveal wall...
in this issue - blockchain slip time, Self Counterbid,
lazy-blind-bidders, blind tell, UnderBid, Grok Underbid
*1 -- Examples of block flash slips 75540, 75542, 75586, 75588 and a slow slip (a deer block) 75553
(see img7 below)
*2 -- 14 hours or 82 blocks is a conservative estimate, you can usually see blinds on NameBase after 45 blocks
Please send comments or questions to - email@example.com
(if you got this far then you passed the brown m&m test, here is your prize - "Block and Digit" refers to the fact that snipers like to outbid others by the minimum of a single digit and they always wait for the last block)