The sphere of cryptocurrency is widening, turning from a niche industry into one that is becoming a mainstream payment option for various sectors.
One of those is iGaming and the gambling industry at large, and this is largely due to what blockchain technology offers. Cryptocurrency offers unique features that fit well with the profile of many online gamblers and the needs of the iGaming world.
Cryptocurrency provides anonymity and almost instantaneous transactions, making it the perfect fit for online players. On top of that, the fees for transactions are far lower than many traditional payment methods. There are many more reasons why cryptocurrency has become the choice for online betting sites in the past few years, particularly the offshore sites – accounting for around 50% of the $500 billion industry.
We will guide you through the benefits of cryptocurrency gambling and shed light on the blossoming relationship between iGaming and digital currency.
The Benefits of Cryptocurrency
The fast-moving world of digital currency has seen unprecedented development in 2021, from companies like JPChase Morgan and Mastercard investing in payment systems to the pioneering cryptocurrency Bitcoin reaching a market price upward of $68,000.
The success of crypto is largely down to it’s inherent value. Major coins like Bitcoin (BTC), Ethereum (ETH), Litecoin (LTE) and Solana (SOL) have become important investment assets and can be used as a payment method, notably in the world of online casinos and gambling.
In many countries, Bitcoin and other major cryptocurrencies are not issued by a bank, or protected by government legislation, which has resulted in the concept of decentralised finance (DeFi). The concept of ‘DeFi’ currency is very appealing to newcomers, as well as long term crypto enthusiasts. There are plethora of appealing aspects about crypto, but here are just a few:
- Transactions carry low fees (often no fees at all)
- Payments are confirmed swiftly
- There is a low risk of payment fraud
- Anonymous payments
- Allows for deposits from anywhere in the world
While this isn’t all that cryptocurrency offers, we’ve highlighted some of the most important features of cryptocurrency in relation to the gambling space.
Cryptocurrency and Gambling
For gamblers, there have always been hurdles in the way of accessing iGaming, casinos, and sportsbooks. The legalization of sports betting in many US states along with the emergence of crypto as a payment method has rejuvenated the gambling industry, offering new avenues to deposit for players the world over.
For some gamblers, the problem for a long time has been accessing the online sportsbooks. Some governments have strict gambling laws that block payments and track bank statements to ensure payments aren’t made to online betting companies. Crypto allows players to fully retain their anonymity and avoid issues with jurisdictions where online betting is prohibited.
Anonymity is important for other reasons too. Darren Moore, CEO of online sports odds website Betfinder said “Many gamblers simply don’t want these kinds of payments showing up on their bank statements and prefer not to reveal their gambling outright. Using cryptocurrency is a great way to deal with that.”
Over the years, many users in the iGaming industry have chosen payment methods due to the speed of payment and the quick access to funds. Cryptocurrency is ahead of the rest in this case, offering rapid (near-instant) payments – this goes for both withdrawals and deposits.
It’s true that the vast majority of offshore betting sites aren’t involved in any malpractice. But, over the years, there have been incidents of non-payment between online providers and customers. With cryptocurrency, transactions are non-reversible (no charge-backs), meaning fraud and non-payment are eliminated from the process.
For gamblers who have hit the jackpot and want to withdraw their winnings, they are used to paying a withdrawal fee, or additional charges, to access their funds. This differs with crypto, as transactions tend to have few overhead fees, allowing casinos using bitcoin to have a very low house edge.
Finally, major cryptocurrencies like bitcoin and ethereum are decentralised. This means that the owner will have total control of their funds and can move them freely without having to work with a middleman, namely a bank or other financial institution. This freedom is particularly appealing when tied in with the aforementioned desires of many players involved in online betting.
The Most Popular Cryptocurrencies on Online Gaming Sites
For the overwhelming majority of online sportsbooks and casinos, the cryptocurrencies available are limited to the major currencies bitcoin (BTC) and ethereum (ETH). However, the growth of the industry has meant there are now a variety of other popular digital currencies available; notably stablecoins, which have seen a surge in popularity towards the end of 2021 and are often tied to the American dollar.
Other cryptocurrencies popular with iGaming sites include:
- Tether (USDT)
- USD Coin (USDC)
- Bitcoin Cash (BCH)
- Dogecoin (DOGE)
- Litecoin (LTC)
- Cardano (ADA)
- Ripple (XRP)
Certain sportsbooks and casinos encourage the use of cryptocurrency, as swift and seamless transactions are mutually beneficial. On occasion, gambling sites will offer their own ewallets, or they may use a secure third party to complete transactions, such as CoinsPaid and Blockonomics.
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