The number of digital currency users has grown exponentially over the past few years. There were approximately 3 million cryptocurrency owners in 2015 but that figure more than quadrupled by 2017. By the end of 2018, an estimated 28.8 million people were using blockchain wallets.
Although Bitcoin is the gold standard of cryptocurrency, there are now well over 1,600 cryptocurrencies with a combined value exceeding $350 billion. It’s no mere coincidence that more and more online casinos take Bitcoin payments. In fact, the gambling industry plays a huge role in the expansion of cryptocurrency.
The legality of gambling using blockchain digital currency is beyond murky in many places around the world. In the United States, UIGEA made internet gambling illegal, but individual players have never been prosecuted for gambling online. Instead, the act mainly targeted online casinos, banks, credit card companies, and other payment processors making it tough for Americans to deposit and withdraw funds. Bank transfers and credit card payments too and from online casinos were regularly blocked. This is still a problem even in some states where online gambling is legal.
Enter cryptocurrencies like Bitcoin which, because they weren’t regulated or considered a legal tender, created a bit of a loophole. Players could circumvent traditional payment processing avenues and gamble with virtual currency. Naturally, many Americans went this route as did online gambling enthusiasts in other countries with similarly muddy regulatory environments.
It’s almost as if cryptocurrency and gambling were made for each other. The two certainly enjoy a symbiotic relationship. As the number of cryptocurrency-friendly online betting sites increases, so does the number of people who need betting tips from sites like stake hunters quadruples. Sure, a lot of folks purchase cryptocurrency as an investment, but many buy it for the sole purpose of gambling.
Those who use cryptocurrency to gamble with at online bitcoin betting sites enjoy many benefits. Because cryptocurrency transactions don’t go through intermediaries, they are much faster than other payment methods. Many sites process cryptocurrency withdrawals and make the funds available within minutes. The fees, if any, are negligible and then there is a high level of anonymity that so many users appreciate.
From an online operator’s point of view, cryptocurrency transactions are easy to process and they are much cheaper than other payment options. This makes enough of a difference to their bottom lines that many online casinos encourage the use of cryptocurrencies like Bitcoin, Ethereum, and Ripple. Gambling sites that convert cryptocurrency deposits into supported fiat currencies absolve themselves of the risks associated with the wild fluctuations that cryptocurrencies are prone to. It isn’t uncommon for operators to offer exclusive bonuses to those who deposit using cryptocurrency. This gives the masses another reason to purchase cryptocurrency and use it for gambling.
Even though there has been an increase in crypto-friendly online casinos, only about 10% of all betting sites accept blockchain digital currency. The vast majority of the most reputable and established operators have shied away from embracing the trend. William Hill, Ladbrokes, 32Red, and 888 are examples of major betting companies that do not accept Bitcoin. Not only that, it doesn’t seem like they will any time soon. The same applies to existing online casinos in the United States.
Until the US federal government regulates cryptocurrency as legal tender, Americans won’t be conducting any cryptocurrency transactions at US-based online casinos. Of course, this doesn’t mean Americans won’t continue using Bitcoin and other cryptocurrencies at offshore sites. This especially applies to American sports bettors and online poker players. Generally speaking, offshore sportsbooks offer better odds and more wagering opportunities while international poker sites boast much larger player pools.
So, will the expansion of legalized online gambling and the plethora of alternative payment options that come with it bring about a decline in the global use of cryptocurrency? Not likely. There are other factors in play. For starters, many central banks around the world are seriously considering the introduction of their own digital currencies. Furthermore, there has been a sharp increase in the number of businesses that accept cryptocurrency payments. Even Facebook is hopping on the bandwagon with the planned introduction of its own blockchain currency, Libra.
Digital currencies struggled to find acceptance when they first appeared. Now, they have entered the mainstream. Cryptocurrency owners can use it to purchase a wide range of goods and services from both online and land-based businesses. Gambling will continue to play a role in the continuing expansion of cryptocurrency, but so will other industries.