Online gambling is rapidly becoming one of the fastest-growing businesses in the world. Its popularity has consistently gone up since the mass adoption of the mobile Internet. In societies where gambling is allowed, it is one of the major economic contributors.
The Gambling industry is marking remarkable growth with an annual compound rate of 9%, which is three times higher than that of the global GDP and is expected to reach $565 Billion by 2022. The incredible numbers lured industry experts to put blockchain in operation for its sheer capability of transparency. But the issues still seem on par with the solution recent technology is introducing.
Online/offline gambling has always been in a tug of war with one side stating the apparent human nature of gambling and that people should have to spend their money however they want to. Plus, it opens up international trade and gives space to collect tax in revenue. The other side drops down heavy criticism citing gambling is highly addictive, unethical and is prone to fraudulence.
According to a British study, people in general associate the gambling industry with cheating and fraud. There’s a notion around online betting that such sites rig their system to change end results in the site’s favor, which is true to some extent. Although transparency is not always necessary, gambling might have a really unique use for blockchain. Since gambling has a number of issues that need to be resolved, blockchain is the actual and most straightforward solution to all the facing problems.
Over time, online gambling has earned a bad rep for being unfair. The frequency of players losing more than winning is very high, which happens to be the revenue model for the casinos. Users don’t trust online betting portals, and they see them as a money-sucking vacuum. Some believe there’s trick up casino’s sleeves that increase a player's winning and losing opportunities. Many also reported having been charged ridiculously high percentage as commission, which, again, is a significant disadvantage.
Casinos have been reported to cheat. There have been cases where players who won a good amount were barred from accessing the site. Some were made to wait for weeks before their payments arrived. Apart from that, legal and financial institutions don’t like gambling bodies as well. Banks even threatened to account holders of their accounts if they didn’t stop gambling.
Unsecured Personal Data
The Gambling industry forces people for a KYC. Meaning a user will have to submit valuable personal information to signup. The information is kept stored in centralized databases that are not secure leaving information vulnerable. What pushes the matter further is that this industry has always been in controversies surrounding data breaches. Stolen data could be used maliciously for various harmful purposes.
Blockchain isn't a magic spell that'd transform the gambling world and turn the winning odds in a player's favor. What blockchain can do is record all the games, and the placed bets and the outcomes. Even the amount that was won and the amount that got paid to the players, the remaining balance, every transaction history can be checked, reviewed, and confirmed. This ensures fairness throughout the game and that nothing is rigged to favor one side.
Blockchain is famous for its decentralized system that gets rid of centralized control, while also providing significantly higher privacy. This way, it is possible for almost everyone to become a user of casinos because it offers total democratization of the processes.
Ever since blockchain made its debut, industry experts started seeing this tech as something people would trust. Thus, the gambling world can benefit from a decentralized network and distributed ledger technology as trust is something it lacks. The DLTs will let users see that casinos are playing ethically.
Business to Peer
If you send a wire or any other form of payment to a business, you usually have to do the transaction with no intermediary or third party. Blockchain technology cuts on wait times, and reliance on a third party and transactions simply and safely can get sent through. A good example is Bitcoin where transactions' legitimacy is verified by miners, which is an automated system with no third party holding a claw on your money.
Accessibility and Reliability
With blockchain in the scene, more and more users will come into the world of legal gambling, and with banks having no affair, the whole process is going to be worry-free. However, if a state or country has illegalized gambling, users mustn't be involved in it.
In the past, there have been situations where casinos used some scams to trick their customers and steal from under their noses, this caused unreliability among users/players. Blockchain eliminates fraud and the fear of being cheated. And this is possible through the use of smart contracts that verify records on a shared ledger that cannot be manipulated. This approach competently increases transparency and eliminates concerns over fairness in the calculation of odds and regarding the protection of money placement.
But even with the blockchain, if an online casino is directing games, a user can play and bet on, and what games they can't, the system is not decentralized, which is an indication of restricted accessibility. A casino must provide users with the opportunity to add more events they can bet on, and it shouldn't be limited to sports only, something possible with the adoption of blockchain.
Blockchain technology is proving beneficial to the online casino industry. It allows for a complete overhaul of transactions for games and online gambling. Speeding up deposits and withdrawals is a core aspect that any platform can benefit from. Providers including Ahti Games and Yako leverage this technology for secure cross-border and international payments. Moreover, the integration of blockchain has a positive effect on the customer base. Various gambling platforms integrating blockchain payment support, and Bitcoin in particular, regarding the list from Best Casino Sites - are receiving some of the highest rankings in the online casino industry. As payments can be done through a wide variety of assets, people are more eager to check out what these platforms have to offer. For businesses, leveraging blockchain-based payments gives them a more modern appeal that can positively influence their perception and reputation.
Longer-term i.e. within five years, blockchain-enabled gambling will be massive and will probably rival traditional iGaming as we know it today. It’s not going to be traditional casinos with lots of slots games, it’s going to be skins, loot boxes, skins gambling games and E-sports and so on. In other words, skins gambling i.e. loot boxes, which are controlled by the game publishers, will end up migrating onto the blockchain and into open marketplaces/ecosystems and you will then have a massive explosion in online gambling.
For obvious ethical and legal reasons, blockchain is imperative. But not to forget there are bigger concerns lurking around the corner. Money laundering is one of the biggest concerns, then comes prevention of gambling among minors and barring people, hailing from a country that restricts gambling from gambling. All this requires careful and thorough planning process to include features that abide by country regulation and do everything to promote fairness and help mitigate risks.
Level up your reading game by joining Hacker Noon now!