Sunday, September 29, 2024

Bw Reads: How to beat online poker

A Russian group won big with AI

Welcome to Bw Reads, our weekend newsletter featuring one great magazine story from Bloomberg Businessweek. Today we're featuring Kit Chellel's story on poker bots and the card-playing Siberian AI that outsmarted the world's brightest researchers and raked in millions. You can find the whole story online here.

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"Feruell" is near the top of poker's food chain. A professional from Russia, he makes a living gambling anonymously on GGPoker, Americas Cardroom and other sites, sometimes using Darth Vader as his avatar. Fellow sharks and smaller fish with money to lose are his prey. Feruell keeps his emotions in check during games, but he's outspoken in poker forums when he sees something he doesn't like.

In 2013 another player caught his eye. Vyacheslav Karpov, aka Performer, was posting lurid tales in a Russian-language chatroom about prostitutes and card tricks he'd learned from "gypsies." To the cerebral Feruell, Karpov's boasting looked ridiculous. Even worse, he was charging young male acolytes for the privilege of receiving his advice, including how to cure anxiety with booze.

Feruell logged on to the chatroom and accused Performer of telling "fairy tales" to "collect $50 an hour from suckers." He added that Karpov "doesn't know how to play poker."

Karpov threw down a gauntlet: "I challenge you to a fight."

The duel he proposed was in Limit Texas Hold 'em, a variant in which two cards are dealt to each player, then five more cards are dealt face up, interspersed with rounds of betting in which the maximum raise is capped. This happens to be Feruell's specialty—he's been called the "King of Limit." The match was set up on the PokerStars website. Bets would max out at $200.

Feruell doesn't lose often. But when the game began, pot after pot went to Karpov. Some 400 hands later, the match was over, with the King of Limit down $20,000. "His level of play was out of this world," Feruell later recalled.

He was suspicious right away. How could he have been outsmarted by a guy who ranted about homosexuals taking over the world? Although Feruell couldn't prove anything, he guessed Karpov had used software to direct his moves. Poker-playing programs—poker bots—had been around for decades, but for most of that time they hadn't been good enough to beat top human competitors.

Feruell and Karpov both made their names in the boom era of online poker, which kicked off in 2003 after a Tennessee accountant with the improbable name of Chris Moneymaker won the World Series of Poker in Las Vegas. Moneymaker inspired millions around the world to try their luck, just as online poker sites emerged to make it easy to do so. These hobbyists were happy to pay good money to test their skills. Maybe they'd even win a little and then—why not?—make it to the World Series of Poker themselves.

Throughout this era, players could be reasonably confident that the people on the other side of the virtual table were, in fact, people. But Feruell had good reason to be suspicious. As researchers were using virtual poker to push the limits of artificial intelligence, machines were creeping into the online game. Some unscrupulous operators used software to cheat. Bots began to proliferate and contribute to the game's decline. By 2019, the same year a bot designed by researchers at Carnegie Mellon University humbled five pros in a mini-tournament, Morgan Stanley analysts warned that AI was an existential threat to the online poker market, still worth around $3 billion today. The rise of "superhuman poker bots in the online ecosystem now appears to be a matter of when, not if," their report read.

That day has arrived. Advanced poker software is now widely available for a few hundred dollars. Forums are full of accusations about everyone from anonymous, low-stakes fish to sponsored professionals. All the big platforms promote a zero-tolerance policy, but no one seems to know how many bots are out there or where they come from. "It's a scourge," one gambling executive told me.

When I started investigating poker bots, I came across an obscure chatroom thread posted by a whistleblower describing an operation so large it resembled an international corporation. It had a board of directors, training programs and an HR department—everything, it seemed, but a water cooler. Allegedly based in Siberia, the group was said to have absorbed all potential rivals in the region, becoming known as Bot Farm Corporation, or BF Corp. "You can't do anything about it," wrote the whistleblower, who seemed to have inside knowledge. "A machine is always stronger than a man."

I was intrigued but wary. The poker community, pumped up with testosterone and greed, is rife with conspiracy theories. One high-profile player had to go on camera with the website PokerNews to deny running a cheating cult fueled by hallucinogenic frog poison. The paranoia results, in part, from a lack of information. Neither professionals nor poker providers want to acknowledge the presence of intelligent machines for fear of deterring the new players whose money keeps the game afloat.

I decided to find out the truth about BF Corp., by following a trail of leaked internal emails and legal and corporate filings, and by conducting interviews with players, gambling executives, security consultants and botmakers. When I finally tracked down BF's Siberian creators, they reluctantly agreed to an interview. They turned out to be more deeply embedded in the poker industry than I could have imagined. And, far from ruining the game, they told me they wanted to save it.

Keep reading: The Russian Bot Army That Conquered Online Poker

More: Kit Chellel previously wrote about the gambler who beat roulette.

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