Pros of using cryptocurrency in iGaming
The twenty-first century, among others, gave the world the phenomenon of blockchain. It is a rules-based, continuous sequential chain of blocks containing information. The connection between blocks is provided not only by numbering but also by the fact that each block contains its hash sum and a hash sum of the previous block.
One of the applications of blockchain is to use it for financial operations. Based on this technology it is possible to create the so-called cryptocurrency. Bitcoin, Litecoin, Ethereum – these terms are known not only in the world of technology but also far beyond. These currencies are not provided by any bank and are recognized by only a few countries (and even then with significant restrictions). Nevertheless, they can be used to pay for goods and services.
Of course, it is not possible to go to the store and buy a package of products for bitcoins yet. But you can pay them online for a variety of services, from hosting fees to ordering freelancers from other countries. The subject of ordering goods on the darknet, we will not touch upon. We are more interested in the prospects of using cryptocurrency in the field of gambling.
Cryptocurrency in iGaming
Bitcoin and derivatives are primarily good because they are not tied to real financial institutions. If a person gets a Bitcoin purse, no one asks him or her to prove his or her identity. Therefore, neither the bank nor the state can trace the entire chain of funds flow. And sometimes it is a problem.
- In 2019, Apple announced that its Apple Card will block all deposit replenishment attempts at online casinos and bookmakers’ offices. This is the first time for the U.S. market, but it may be followed by other banks;
- In China, the government strictly monitors officials’ spending, thus fighting corruption. A government official shouldn’t pay with his card, especially when it comes to large expenditures. By the way, it is China that issues most of the Bitcoins;
International gambling sites accept payment in dollars and euros by default. When replenishing the deposit from national bank cards of some Namibia or Georgia, the bank can convert funds at a very high rate. Sometimes it is more profitable to buy first the cryptocurrency, and then either exchange it for dollars or replenish the bookmaker’s account directly;
- A complete ban on gambling in some countries implies not only the blocking of foreign sites but also the blocking of money transfers to the accounts of these organizations. In this case, the cryptocurrency becomes almost the only way to try your luck.
Banks also have another problem – compared to cryptocurrencies, they are very slow. No, of course, you can top up your account with a card almost instantly. But when it comes to withdrawing funds, you often have to wait from a few hours to a few days before the winnings fall on the card. Bitcoin doesn’t have this problem and transactions are done in seconds. And only in complicated cases can it take a few minutes.
Finally, the bank can send data to the tax office. The higher the amount of transfer received, the higher the probability of this. Each country has its requirements and limitations in this regard. If a person gets his or her winnings on a wallet with cryptocurrency, then he or she can minimize the risks. For example, to withdraw money in small amounts to different accounts through different exchangers.
A separate advantage for the casino is that if the player on the cryptocurrency wallet has a small amount of money, it is likely that he will spend it on gambling. Because converting small amounts of money into real money is not profitable because of the characteristics of the course.
Provably Fair System
Anonymity and speed aren’t all that good about bitcoin. Since blockchain technology is the basis of its operation, any transaction (within a blockchain network) can be tracked and checked for correctness. Thanks to this, the chance of fraud with money drops to zero.
Many players in online casinos are very concerned about the possibility that they will be cheated. They say that the casino can twist the scripts to pay the minimum winnings.
The business has long proposed a solution to this problem: the use of licensed software. There are large companies that guarantee that their software works in the right way. Any website or application can use this software under license. And the guarantee is the fact that all operations are performed on the servers of the “authoritative” company.
Some suspicious players are not satisfied with even having a license. The license is issued by other companies. And even if these inspection organizations do not find any violations based on the results of the inspection, then who knows what happens afterward. For a software developer, in theory, can make changes to the code at any time.
In general, it works. But the element of trust is still preserved. Everything is not that simple with blockchain, but much more transparent. If the bets are in cryptocurrency, not abstract points, then each player can compare the number of hashes before the game starts (the sum of all bets) and at the end of the game (the size of the winnings and the share of the casino). If they match, then everything is fair.
Of course, you won’t have to count manually. Casinos that use the Provably Fair system simply add a verification button to the interface. Any player can press it at any time.
It turns out that licensed casino software is not required. Players can check the integrity of the company at any time. So, in principle, you can refuse such licenses in the long run.
But if someone has any suspicions (including the work of this magic button), they can spend time and compare all the hashes manually with the help of special software. Thus work of cryptocurrency casino becomes transparent on 100 % and does not depend anymore on licenses, checks of the inspecting organizations and so on.
Many experts read the cryptocurrency for a cloudless future. We won’t claim for all spheres, but it seems that gambling and blockchain are just created for each other. Anonymity, convenience of input and output, 100% guarantee of fair play – all this is suitable for both players and business. So we recommend developing this direction along with all the others.