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In online gambling provably fair describes an algorithm which can be analyzed and verified for fairness on the part of the service operator. Provably fair algorithms are often used in the operation of an online casino.
In a provably fair gambling system, a player places bets on games offered by the service operator. The service operator will publish a method for verifying each transaction in the game. This is usually by using open source algorithms for random seed generation, hashing, and for the random number generator. Once a game has been played, the player can use these algorithms to test the game's response to his in-game decisions and evaluate the outcome by only using the published algorithms, the seeds, hashes, and the events which transpired during the game.
The benefit of a provably fair system is that third-party verification and auditing is usually unnecessary. Results of bets for which the outcomes are mathematically predetermined are harder to scrutinize and thus the system can add a degree of trustworthiness to a gambling operation. It could also potentially expose the operator to hacking attempts if there are undisclosed security flaws in the open source software.