BitLotto
A lottery style gambling site with 99% payout of a monthly jackpot to an almost always sole winner. Because of this, the odds of winning the lottery are approx 1 out of the total jackpot size.
The winning selection of lottery numbers for determining the winner or winners are the results of the Western Canada Lottery Corporation draw. The website mentions that starting June 1 numbers will be derived from the Bitcoin network.
The Bitcoin transaction hash of the 1 BTC purchase is used as the "pick" and to see who sent it, and therefore know where the winnings should go. The algorithm for converting the winning lotto numbers to the characters in the entrant's Bitcoin transaction hash is documented on BitLotto's site.
The service was launched on April 6th, 2011[1].
Criticism
The site does mention that sending Bitcoins from an eWallet will cause the winnings to go to the wrong person. When a winner is paid, the funds are sent to the Bitcoin address that bought the winning entry. If the user buys the ticket using an eWallet service those funds are lost as any winnings will then go to someone else. The site clearly states many times, that as long as the user buys the ticket using Bitcoin software running on their own computer, they will not run into a problem.
Unlike other gambling sites, BitLotto requires Bitcoin payments in a specific manner because of how tickets are tracked and winnings paid out. BitLotto has chosen to operate in this way to increase the transparency of the lottery.