Blockchain Technology in the Gambling Industry: Is It a Good Fit?As you may have already read in our recent blog post, Why Bitcoin is a Win for Everyone, seeing the growth of the Blockchain in the online casino and gambling industry, we thought it a good fit to expand our sentiments!
What is a cryptocurrency?A cryptocurrency (or crypto) is a digital asset, i.e. basically money. The very first crypto currency was Bitcoin, which launched in 2009. It remains the predominant cryptocurrency, although a host of others have since been issued. Cryptos were designed to be used as a way of exchange, independent from various hard currencies (also known as ‘fiat’). Cryptocurrencies are entirely digital and do not exist in paper form. One buys cryptos with ‘real’ money at its current value, which has skyrocketed since its inception, although its day-to-day value can fluctuate.
What is a Blockchain?The big difference between cryptos and fiat (besides cryptocurrencies being purely digital), is that they have decentralized control, differing from the conventional banking system which is highly regulated. All transactions with cryptos are peer-to-peer (i.e. shared access to files without a central server) only. These decentralized files are stored in ‘blockchains’. A blockchain is basically a public digital ledger where all transactions are recorded and stored. All financial information is strongly encrypted and secure from hacking, alterations or deletions.
What are the benefits of using cryptos for gambling?Anonymity – Once you’ve exchanged your money (hard currency) for crypto, any transactions out of your e-wallet (for example, to a casino) are anonymous from the time you transfer out. No bank or financial entity has any record of what you do with your cryptocurrency. Of course, you still have to prove your identity and address to a casino for legal reasons due to license regulations.
Data security – Because your transactions are protected through encryption, you don’t have to worry about theft of sensitive data by hackers.
No intermediary processing – Without having to go through banks, transactions are much quicker and don’t get caught up in red tape.
Low or no transaction fees – Casinos such as DuckyLuck that offer Bitcoin as a deposit and withdrawal method, have lowered their fees, making it worth your while to use this preferred method. And as there is no currency conversion, which also involves extra fees, as well as the exchange rate that may not be in your favor, you are benefitting financially.
Fast deposits and withdrawals – As there are no intermediaries involved in transactions, your money is readily available to gamble with or withdraw in a much faster turnaround time.
Are there any drawbacks to gambling using cryptos?While the gambling industry has been a leader in the use of cryptocurrencies, there's still a lot of knowledge to be passed down to the user - which we're always working on! As cryptos become more and more mainstream, more people will become comfortable with the concept.
There are a few things to be aware of when using a Bitcoin e-wallet. Be sure when making a transaction that the details are correct, as you can’t reverse a transaction. In addition, your Bitcoin e-wallet doesn’t actually hold Bitcoins, just the keys to access your money. Be sure never to lose or compromise this information as you may end up losing all your money, as there’s no recourse for recovering these codes.