The gambling industry has experienced a significant sea-change over the past 10 years, insofar that players no longer need to leave the comfort of their own home to access their favorite games. Whether its sports betting, poker rooms or traditional casino games – the industry has grown in direct correlation to the global adoption of digitalization. As a result, the online gambling sector is expected to grow to more than $81 billion by the end of 2022.

However, a new breed of technical innovation is beginning to make its mark, in the name of blockchain technology. It is now possible to deposit, stake and withdraw funds using popular cryptocurrencies such as Bitcoin and Ethereum, with more and more operators now specializing purely in the virtual phenomenon. This brief article will explore the potential benefits of online gambling platforms that utilize the innovation of blockchain technology.

Privacy

Anyone that’s been around the online casino industry for long enough knows the standard process when it comes to identification. First and foremost, the account opening process requires the player to supply a range of personal information, which most commonly consists of their full legal name, address, date of birth, country of residence and telephone number. Moreover, prior to the withdrawal of funds, the player must then have this information verified by supplying certain documents such as a passport and proof of address. It is also common for the operator to request a copy of the player’s debit/credit card, to protect the firm from the risks of fraudulent activity.

On the contrary, online casinos that focus exclusively on cryptocurrency deposits do not request any of the aforementioned information. In most cases all that is required to open an account is an email address, which is only needed in the event that the player loses their login credentials. As a result, Bitcoin and Ethereum casino platforms facilitate anonymous gambling. The legality of this is still debated at the highest level, with proponents arguing that because real-world fiat currency is not involved, standard anti-money laundering regulations do not apply.

Speed

The regulatory burdens that are linked to the above KYC processes often results in a slow and inefficient payments process. Although debit/credit card payments are usually credited to a player’s account instantly, it is the withdrawal of funds that remains a frustrating experience. Once the player has had their KYC documents authenticated, they must then wait for their respect casino to process the request.

Not only can this take up to three working days, but some operators lure the player back in by allowing them to reverse the withdrawal and subsequently – transfer the funds back in to their betting account. The final part of the withdrawal process is then at the helm of the card issuer, which can take an extra few days before the funds are cleared.

This is in stark contrast to how many cryptocurrency casinos operate. It is standard practice for online gambling operators to process a withdrawal request in an autonomous nature, meaning that players only need to wait for the respective blockchain to confirm the movement of funds. For example, Bitcoin and Ethereum transactions average a block confirmation time of 10 minutes and 16 seconds respectively, which is stark contrast to the capabilities of the traditional online casino sector.

Transparency

A particular issue that often springs up when discussing the online gambling industry is transparency. Although software games are usually supported by a well-known RNG (Random Number Generator) protocol, the underlying data is kept behind closed doors. It is up to the casino’s gaming license issuer to audit the RNG database, meaning that players never actually get to validate it themselves. In this sense, an element of trust must exist between the player and the operator.

On the flip side, blockchain casinos utilize an innovative protocol known as provably fair. The provably fair protocol is supported by the art of cryptography, which is a highly advanced discipline of mathematics. In a nut shell, each and every gaming outcome (for example a hand of blackjack) is guaranteed to be true and fair – with there being virtually no avenue for either the player or the casino to engage in malpractice. Most importantly, all of the provably fair data is available to view at any given time – making the process ultra-transparent.

What does the future hold?

The aforementioned characteristics of a blockchain casino offers some interesting alternatives to the traditional fiat casino sector. In-line with the decentralized benefits of Bitcoin, Ethereum and the rest of the virtual economy, more and more gambling operators are now beginning to specialize purely in cryptocurrency deposits and withdrawals. Not only does it have the potential to benefit the player, but it also reduces the regulatory burdens that many platforms face.

Ultimately, it is important to remember that the Bitcoin and Ethereum casino sector is still in its absolute infancy, so it is always worth conducting your own research prior to taking the plunge. Moreover, there are now a variety of impartial websites that independently review blockchain casinos – in an attempt to separate the wheat from the chaff.