Bitcoins and Online Gambling: A Match Made in Heaven?

1 week ago
Bitcoins and Online Gambling: A Match Made in Heaven?
10:10
13 Jan

Online Casinos have seen an increase in casino providers who offer cryptocurrencies, most famously Bitcoin, as a payment method. The popularity of Bitcoin among poker players has pioneered this trend. There are enough of them today that the term Crypto Casino was coined to describe them. But if you’d search for catchy terms for other payment methods, such as PayPal Casino, you’d find none. What makes the ability to use Bitcoins so special that a thing as mundane as one of many options to pay is the main descriptor for an entire category of casinos?


The Rise of Bitcoin Casinos

Using Bitcoins is obviously more than one of many options for transferring money from one person to another. Enough online gamblers have looked for casinos who offer the payment method, and enough casinos matched their demands to make the category Crypto Casino necessary.

The term might be misleading to some, who expect the entire casino to be built differently than others. Bitcoin casinos don’t allow farming the coins or put any sort of thematic spin on their website and game selection. They simply allow users to deposit money and withdraw winnings in form of bitcoins via their e-wallet.

Why does cryptocurrency as a payment method deserve this kind of attention, and what makes Bitcoin so special, specifically?


The Philosophy of Bitcoin

Many people look at Bitcoin as something that was born from a capitalistic mindset, something that typically aligns with the core values of our system. You might be surprised to hear that it was actually quite a revolutionary idea. Revolutionary in the truest sense of the word, as in against the government and societal structures.

In fact, it grew from the philosophy of cyberpunk activists creating and sharing open-source software in their fight for digital freedom. The choice of using the blockchain technology and peer-to-peer methods is representative of that. It has no owner to act as a controlling authority but is owned by the crowd of its users.


Bitcoin’s Purpose

Bitcoin’s goal is to create a censorship-resistant medium of exchange with the same core attributes as regular money. The important factor being that the currency is not government regulated and therefore exists outside of authoritarian control. Meaning, even those who must obey the system and often suffer as a result of unfair structures gain an opportunity to succeed.

If your bank declines your loan for whatever reason, especially if it is based in prejudice, Bitcoin offers you an alternative. It offers everybody the same chances, regardless of identity, wealth, or history.


Goals Met

Bitcoin’s philosophy actually works: In 2018 Venezuela’s authoritarian government had destroyed their economy. Strict financial control and hyperinflation left many citizens financially ruined with no way of pushing back. Thousands of Venezuelans fled the country as a result.

Some remaining citizens then decided to receive incoming transactions from foreign countries in the form of Bitcoin exclusively. As a result, the government couldn’t take their implemented cut of incoming payments or the banks’ information on their citizens’ wealth and transactional history.

The essayist and risk analyst Nassim Nicholas Taleb called Bitcoin “an insurance policy against an Orwellian future”. With this noble pursuit in mind, how does that factor into online gambling, of all things?


Bitcoin’s Features

To determine why many gamblers have started using cryptocurrency for their deposits and pay-outs, we should look at the features of Bitcoin and their advantages.

  • Autonomy | Bitcoin is control and censorship-resistant by existing outside of the government and financial institutions. A country’s financial crisis or a failing system have no negative effect on the currency.
  • Anonymity | Transactions with Bitcoins are almost 100 % anonymous. For one, there are no third-party institutions that store your personal information. Secondly, instead of names, Bitcoin transactions record the
  • Bitcoin address (~30 random characters) of both participants. It is, however, not impossible to connect the real-life person with their Bitcoin address with enough effort and information.
  • Security | Bitcoins are decentralized. There is no central network that stores the data. It is spread among countless computers across the world and offers no singular weak point to attack. When one part of the network fails, the others keep the system running. Additionally, the blockchain records every transaction with unique identifying codes. This way the transactions are traceable and impossible to alter.
  • Speed | Bitcoin was made exclusively for online use and is optimized to function in this environment. That makes Bitcoin payments especially fast. Most transactions are confirmed within minutes.
  • Cost-Effectiveness | Unlike other currencies, Bitcoin is not processed through financial institutes. By cutting out that middleman, Bitcoin transactions have fewer transaction fees, compared to banks or payment services like PayPal.

The Advantages of Bitcoin in Online Gambling

All of these features have advantages for online casino transactions. The unique autonomy of Bitcoins is the reason any of these positive features exist. By not being government controlled or working with financial institutes and using peer-to-peer technology and the open-source mindset, the Bitcoins can be used safely, fast, anonymously and cost-effectively.


Anonymity

Using the e-wallet that stores the Bitcoins feels a bit like using PayPal. Instead of using your bank or personal information, you log in with your e-wallet. There is no need to mention your personal data at all. By conventional means, there is no way to tie the wallet to your person. Using it for gambling will never reflect negatively on your credit score the way using a bank account might.


Speed

Many players base their casino choice on which provider offers the best withdrawal and deposit times. Depending on the available transaction services and your location, it might take a couple of days for winnings to appear in your account. Transferring Bitcoins is often instant or takes less than a day.


Security

The blockchain technology makes Bitcoins incredibly safe. The coins and transactions are encrypted and carry unique identifiers for every single transaction. It minimizes the risk of unauthorized access and use of an e-wallet. The transaction history makes it possible to recreate a coin’s path to its origin. This counters the fear of many that the anonymity of Bitcoins will be used for illegal actions.


Cost-Effectiveness

Without the higher fees imposed by banks for national and international transactions, using the digital currency saves you the money spent on transaction fees over time.


Conclusion

Bitcoin gains a special focus when it comes to advertising a casino’s features because it comes with benefits other transaction methods lack. By using the cryptocurrency, you can play with greater anonymity and security, save transaction fees and quickly transfer money to and from the casino. The e-wallet is easy to implement and fast to use without giving away personal data. The blockchain-technology makes the Bitcoins almost impossible to be accessed and used without authorization. Any kind of illegal alterations can be traced.

Many players prefer Crypto Casinos because it keeps their gambling from impacting credit scores. Many banks use proof of it as a knock-out criteria for loan applications. Others use the anonymity to gamble in areas where online gambling is illegal or in a legal gray area. Though the anonymity of Bitcoins is very strong, it is not impossible to trace them back to you. If that is your reason for using the cryptocurrency, consider this risk well. You should also keep in mind that the value of Bitcoins can fluctuate often.


Articles 158

Writer and semi-retired poker pro from Edinburgh (UK).Read more

Comments

You need to be logged in to post a new comment

No Comments found.