Cryptocurrency at the online casino

Online gambling was launched in the late 1990s with a few sites that offered basic table games and three-reel slot machines. Over the last 20 years the industry has grown by leaps and bounds. Today, Grande Vegas Casino and other online casino gambling is a multi-billion dollar industry that serves hundreds of millions of gamers who play online on a PC or a mobile device.

Advances

Each new advance in Internet technology has enabled the industry to grow. During the first decade of the 21st century, game developers started coming out with more dynamic and interactive game options. By 2012 the advances in mobile technology enabled gamers to play via wireless Internet access at the mobile casino.

The online casino was one of the first Internet venues to connect to cellular connectivity when it became available – this gave mobile players the chance to play at any time and from any location, even when there was no wifi in the area. By 2018 the online casino was able to feature a Live Dealer platform that operates via live streaming technology and gives players who want to compete with a live dealer the chance to play in a genuine Las Vegas casino atmosphere of live dealer action. 

Throughout this time, players funded their casino accounts via online banking services. Credit and debit cards such as Visa and Mastercard, ewallet and evoucher programs that included Skrill Moneybookers, Neteller and Paypal, echecking accounts and wire transfers to and from the gamer’s local bank account, gave players the opportunity to deposit money in their casino account and withdraw payouts for their personal use.

Today the newest opportunity available to online gamers involves cybercurrency, or cryptocurrency transactions. Currently, at least half of the casinos online support cryptocurrency transactions and the number is growing. The question that many observers ask is, is this good for the industry?

Online Gambling Finances

In 2009 the online gaming market had a volume of $20.51 billion USD. The revenue has been growing every year since then and in 2020 it is estimated that the market’s volume will reach $59.79 billion. Online casino supporters say that gambling promotes international trade. They say that the threat of promoting gambling addiction shouldn’t stop the casinos from offering their wares since it’s human nature to take risks such as one does when one wagers. Opponents of gambling cite concerns about the tendency that gambling has to draw criminals, promote fraud and encourage addictive behaviors. Regardless of these opinions, the online gambling market is expanding at a rate three times higher than that of the global GDP at a compound annual rate of 9%.

Blockchain

How is blockchain currency integrating into this market? Flip Poutintsey, CMO of blockchain-based betting and gambling platform Bitbook.ag, says, "It’s no surprise that many blockchain entrepreneurs are eager to enter the gambling market, aiming to 'disrupt' it – to use a popular crypto buzzword – thanks to distributed ledger technology."

Poutintsey addresses the question: are there advantages to using cybercurrency in the gambling market? 

Some observers believe that cybercurrency will revolutionize the online casino markets but  Poutintsev feels that the advantages of blockchain haven’t been fully explored. He says that, while in other industries such as commodity trading, blockchain trading has transformed the industry, online gambling is different. Online gambling has a clear range of issues that must be resolved to give the industry a better reputation and, according to Poutintsey, "Blockchain can actually solve these issues quite easily." 

Solving Problems

Poutintsey says that there are clear reasons why Blockchain can solve many of the problems that surround online gaming.  "Blockchain will store records of all games and bets, their results, and the amounts that were won and paid out,” he said. “Players can always access the transaction history to confirm that the system paid out all that was due and that the odds were not rigged."

Issues of trust, Poutintsey says, prevent many gamers from playing online. Cryptocurrency transactions address those issues. "You often hear that blockchain helps build trust among participants – and at the same time, you hear that blockchain systems are trustless. It’s not a contradiction: Both statements apply to blockchain gambling in different ways. In the beginning, we will still have casinos and actual companies that run platforms such as Bitbook.ag – and distributed ledgers will allow players to verify that the casino plays fair. Later, we will transfer to more decentralized betting and gambling systems, with not-for-profit structures at the center exercising a regulatory and protective role, which will indeed be trustless."  

Poutintsey wants his start-up, Bitbook.ag, to develop such a system.

Advantages

There are other advantages of blockchain technology for casino gambling including easy international payments and low fees. According to Poutintsey "Being independent of banks will bring many more users across the world into the fold of legal gambling, as they currently have to use shady services because they cannot pay with their credit card. Of course, the same legal principles apply to blockchain casinos like Bitbook.ag as to traditional sites – if gambling is illegal where you live, you should not break the law".

Legalities

If gambling sites become decentralized, cybercurrencies will be obligated to ensure compliance and cooperation on a number of issues including preventing money laundering, fighting gambling addictions, ensuring that gamers in countries that disallow online gambling won’t have access to the real money games and preventing minors from gambling.

Blockchain must also overcome questions regarding taxation, licensing and regulations in individual countries. These issues complicate the issue of cybercurrency payments as part of online gaming sites. But Poutintsey believes that these issues can be addressed. “Blockchain can and should be used to make gambling fair, lower costs, and prevent fraud – and that’s what we at Bitbook.ag plan to do.

 

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