Even if you don’t pay attention to technological news, you must have noticed that cryptocurrency has become an increasingly popular phenomenon around the world.
Despite some controversy and the ongoing volatility of cryptocurrencies, this new form of money is grabbing the headlines worldwide and helping to shape every industry. The decentralized nature of cryptocurrency, as well as its extra layers of security and privacy, allow it to offer something that fiat currencies are unable to match.
And just as cryptocurrency has been changing the world of retail, it has also been making waves among online casino operators. From cryptocurrency-only casino sites to the variety of Bitcoin casino free spins deals and promotions that are becoming widely available, the online casino sector is being changed dramatically by cryptocurrencies. Here are some of the main ways in which crypto has impacted the world of gambling and betting.
The Perks of Privacy
One of the biggest advantages that cryptocurrency can offer to the online casino player who signs up with a site to play their favorite slots is its added security. When you use traditional payment methods at online casino sites, you are required in many cases to share sensitive and personal information, including details of your bank account or debit card.
Traditional casinos work hard to provide high levels of security but every transaction carries a risk, no matter how small, of identity theft and fraud, since personal information can be linked to financial details, and hackers are constantly attempting to crack the security of sites such as casinos.
However, when you use cryptocurrency for your transactions, the risks are greatly reduced. Cryptography techniques are at the heart of the cryptocurrency model, and these can ensure the integrity and security of all transactions, including deposits and withdrawals at online casino sites.
Essentially, casino players who use cryptocurrency can enjoy a level of confidentiality and security that is not available with traditional payment methods and currencies, and enjoy the added benefit of privacy, which is an increasingly rare quality in the ultra-connected 21st century.
Transaction Speed and Costs
The speed of transactions at online casinos has long been an issue for many players. Those who rely on card transactions can find that their deposits and particularly their withdrawals may be significantly delayed. In the case of the traditional bank transfer, the delay is even greater, and it can take up to five days in some situations for bank transfer withdrawals to go through.
Cryptocurrency drastically reduces the speed of transactions with online casinos. As a decentralized form of currency, it removes the need for intermediary platforms, including banks, and allows for direct and virtually instant transfers between player and casino site – no matter where you are in the world. This means that you are able to access and deposit your funds rapidly, with no associated fees or delays.
The cryptocurrency model has had another impact on transaction speed. Since these are global currencies, there is no need for your deposits or withdrawals to go through the process of currency conversion, so it is easier for players to play at casino sites across borders, and there is no need to use currency conversion sites or make foreign exchange calculations while using online casinos.
Access and Inclusion
Another benefit of cryptocurrencies is that they potentially open up the world of online casinos to a wider audience and allow those who face restrictions on accessing traditional banking services to play their favorite online slots and table games.
In some parts of the world, individuals may not have access to traditional bank accounts, which can have an impact on their ability to carry out many online transactions, including making deposits and withdrawals at online casinos. Cryptocurrency removes this barrier, allowing anyone who has an internet connection to enter the casino world.
There is, of course, a downside to this development. Some individuals turning to cryptocurrency for their banking transactions may be doing so for nefarious purposes or because they are excluded from traditional financial systems due to illegal activity. This is of significant concern for casino operators and players, and in the next section, we take a closer look at the legal challenges associated with the rise of cryptocurrency casinos.
Regulatory Challenges and Considerations
The development of the blockchain technology that underlies cryptocurrencies has enabled the creation of gambling platforms and online casino sites that operate using cryptocurrency as the main system of exchange. While this has been exciting for many casino players, it has created some tough legal problems for regulators to address, and for companies seeking to operate in the cryptocurrency casino sector, there is a complex legal landscape to navigate.
Perhaps the biggest challenge facing those operating in the cryptocurrency gambling and casino sector is a distinct lack of regulatory guidance. Laws and regulations regarding cryptocurrencies are still evolving in most major nations, and in many cases, there is no clear system of guidelines on how they should be operated, leading to uncertainty across the industry.
Another challenge, alongside the uncertainty of regulation, is associated with the crucial issue of customer protection. Many customers are unused to cryptocurrency, which is also sometimes preferred by those who are engaged in criminal activities. Companies working in the cryptocurrency gambling sector have to take steps to ensure that their customers are not at risk of harm.
This link with illicit activities is the third major problem for cryptocurrency operators. Transactions made using cryptocurrencies are anonymous, and while this has privacy benefits for regular customers, it is also exploited by criminal gangs, which may in turn opt to use casino sites or other gambling platforms to launder money or to fund their criminal activities.
That is why it is essential for companies operating in the cryptocurrency casino sector to adhere to strict Anti-Money Laundering (AML) and Know Your Customer (KYC) policies, to ensure that criminals do not use their platforms for illegal activity.
Clearly, the regulatory challenges associated with cryptocurrency gambling are complicated and still evolving. This means that casino operators in this sector have to stay up to date with the latest developments and are required to be even more proactive than traditional casinos when it comes to providing safety and security for their customers.
Future Prospects: Crypto and Online Gambling
Cryptocurrencies were born of technological innovation, and the pace of technological change is accelerating, so it is certain that there will be many new developments in the years to come.
One of the most interesting recent developments linked to cryptocurrency is creating decentralised applications and launching smart contracts within the online casino sector. Smart contracts are self-executing, with rules written into their code to ensure that transactions between casino sites and players are transparent and fair.
Decentralized applications also use blockchain technology to offer a variety of new online gaming platforms that are as decentralized as cryptocurrencies, removing any need for intermediary sites and increasing the level of trust between those involved in these transactions.
In the future, we are likely to see more blockchain and cryptocurrency innovations, including loyalty programs and other incentives based on the blockchain, and it seems likely that the next generation of online casino sites will have cryptocurrency technology at their core.