Bitcoin Casinos are finally a reality, and on this page you will find everything you need to know if you want to get involved and the relationship between cryptocurrency and gambling.
Some Bitcoin enthusiasts prefer the thrills of the investment and day trading but others are keen also to venture themselves in high-roller casinos to give a chance to their luck in roulette, blackjack and other popular games or place a wager on their best team to win.
Until now gambling customers were limited to the normal banking options and had to use traditional currencies to fund their activity. This had the disadvantage that it was not anonymous and your bank would always be aware of how much you were betting, frequency and so on.
Bitcoin have always been proud of not being linked with any state or banking institutions, and this means that gambling with cryptocurrency provides customers an increased layer of privacy which is seen as a positive thing by lots of customers’, said Ethan Rowe betting industry expert at Bestbettingsites.online.
‘It is not a secret that the gambling industry has been looking carefully at the evolution of cryptocurrencies for two main reasons. Firstly, users that are dealing with Bitcoin are open to more risks: all cryptocurrencies are very volatile and this means that in a way people that venture in this area already have some predisposition towards gambling. Secondly whoever is investing in cryptocurrencies is usually rather affluent, and as far as gambling operators are concerned, it is undoubtedly a customer type to attract.’
What are Bitcoin casinos?
Simply speaking a ‘Bitcoin casino’ is an only casino or a sportsbetting company that will accept Bitcoin as a payment method instead of or alongside traditional currencies.
In recent times we have seen a number of large-scale Bitcoin casino emerging online that also have some bespoke games that have been developed with cryptocurrencies dealers in mind.
In Bitcoin casinos, you will find not only traditional games like roulette but also sports betting opportunities, lotteries and even spread betting. Instead of using the term Bitcoin or ‘BTC’ lots of Bitcoin casinos like calling themselves ‘mBTC’ or ‘millibitcoin’ where this terms is indicating one-thousands of a Bitcoin or 0.001 BTC.
How do Bitcoin casinos work?
Apart from the funding of the account and the withdrawal (which is happening in Bitcoin instead of traditional currencies), the majority of Bitcoin casinos are very similar to the traditional ones. For those that are wishing to get involved, Bitcoin casino usually are new customers with an in-house wallet that can be used to transfer the Bitcoins to.
Wagers that the casino is taking are based on how many funds the user has stored. Usually, the player will open a ‘bet’ from their wallet and depending on the outcome of the game it can either lose or win.
To attract and entertain more customers, some online casinos have decided to go the extra mile by offering huge ‘Bitcoin jackpots’ where users have the opportunity to win amounts more than 500 BTC.
Once a game is over, all the profits are returned to the user’s in-house wallet. From that point on the user can decide to either transfer the amount to their private wallet or to keep on playing. The majority of online casinos have some withdrawal limits to avoid users cashing out everything at once. It is therefore important to always check the terms and conditions before starting to place wagers.
Why are Bitcoin casinos so popular?
As we briefly mentioned above, Bitcoin casinos are mainly attracting as they do guarantee pseudonymity and ease and low cost of transfers. By operating with cryptocurrency as their base currency, online casinos are in fact able to escape lots or regulatory purviews.
There have been Bitcoin casinos that have decided to offer zero transaction fees with unlimited free daily transactions to clearly show what it is the advantage of playing in a Bitcoin casino vs a traditional online casino that is using a fiat currency.
Since operating margins are significantly lower than traditional casinos, Bitcoin casinos have a lot more room for launching huge jackpots and therefore be more attractive to customers.
Another significant advantage of Bitcoin casinos is that any user’s profits or losses are not inherently taxable unless the customer is declaring those to legal authority.
Are Bitcoin casinos legal, or ‘under the microscope’?
Similarly to online casinos, Bitcoin casinos are normally in a legal ‘grey zone’ where regulations and sanctions are different from nation to nation. Admittedly, like many online gambling sites, they do pose a challenge for international regulators as Bitcoin are not linked with a central authority: no transactions can be stopped or mitigated. Having said that, several international regulators have decided to issue strong stances against Bitcoin casinos, and one of those is the US.
US citizens, for instance, cannot use a Bitcoin casino in their home country: this is why many operators do exclude customers from the US. There have been some Bitcoin gambling sites that have permitted new users to register by using a pseudonym: in this case, new registrations do not require the user to add their real name and even to prove their identity. This is, however, a risky thing as any legal authority would be able to look at Bitcoin transactions and potentially find out the origin by using chain analysis tools.
Our strong suggestion is that despite the increased level of anonymity given by Bitcoin casinos, that you comply with the legislation in your territory and only go ahead and gamble if it is legal to do so.
What is the future of Bitcoin casinos?
Interestingly enough the future of Bitcoin casinos might not strictly be linked with Bitcoin. Even if Bitcoin and others cryptocurrencies offers significant benefits to the gambling industry as it does give an escape from regulation, fast transfers and privacy, newer cryptocurrencies might present even more benefits.
Since Bitcoin’s debut, we have seen many privacy-focused cryptocurrencies that have effectively anonymise transaction details of everyone involved. Cryptocurrencies like Monero or Zcash could well be adopted by online casinos thanks to their inherent fungibility.
Even projects like Ethereum can offer great benefits to gambling companies and users. Online casinos are likely to do in the future some smart contract to have the ability to control deposits and payouts and effectively be a decentralised and anonymous entity that doesn’t have to correspond any duties to authorities.