The way people are paying online has changed tremendously over the last decade. Credit card, e-wallet, bank transfer, they were all mostly fine, however, they had their share of problems. Processing and transaction delays, excessive fees and lack of privacy encouraged many players to find an alternative.
Then blockchain emerged and offered a solution.
Today, blockchain-powered payments are at the centre of a much greater transformation in how online gambling platforms process money.
The Inefficiency of Traditional Payment Methods
Most online gambling continues to rely on traditional banking systems. That might look simple, but there are frictions with it. Banks can block gambling transactions, withdrawals may take up to days, and fees can lower profits.
This is not a niche complaint. Anybody who has ever tried to deposit and withdraw money in and out of an online betting account is aware of this.
Blockchain Eliminates Intermediaries
As soon as you complete a cryptocurrency payment, there is no bank to mediate on whether or not to accept the payment. This is exchanged among wallets, verified by the network and forever registered on a public registry. The transactions are all logged, time stamped and they cannot be retrospectively revised. This would mean that in the case of gambling websites, they would be able to show how they received and sent money. It is a guarantee to the players that they can verify their own history of transactions and do not require anyone to give them permission.
Another big thing is the speed. Deposits and withdrawals made via blockchain typically take minutes, rather than days to settle, and this enables players to control their money better between sessions.
Cryptocurrency Casinos On the Rise
As cryptocurrency is increasingly used, the number of services specifically designed to take advantage of it has grown as well. The entire system of crypto casinos is built around the concept of payments based on blockchain, with assets like Bitcoin, Ethereum, and other stablecoins to facilitate all operations. This fixes a lot of the conventional banking infrastructure issues.
Besides payments, most of such sites pair crypto deposits with provably fair technology, which offer players an additional confidence in the fairness of the game they are playing.
Stablecoins Bring a Predictability Factor
One of the issues that most players are worried about crypto payments is their volatility. When Bitcoin drops by 15%, and you have money in a casino wallet, your bankroll is hurt.
Stablecoins take care of this. An asset like USDC or USDT is pegged to the US dollar, and therefore its value does not fluctuate. Players do not need to worry about the speed and transparency of blockchain by waking up to a lower account balance when a market fluctuation occurs. This is a big thing for anyone who is concerned about the management of their bankroll.
Privacy, KYC and Player Autonomy
One of the less addressed benefits of crypto payments is the effect on the privacy of players. The traditional online gambling accounts require a full identity check – passport verification, address check, even in certain instances bank statements. It is known as KYC (Know Your Customer) and should be in compliance with financial regulations, though it also means that players share a great deal of personal data with websites that they may not fully trust.
This dynamic is changed when using crypto payments. Even though full anonymity gambling is not widespread due to licensing laws, many applications based on blockchain do not have as many verification procedures. Rather than a full financial profile, players have a wallet address to deposit and withdraw money.
This is a big advantage to the user in places where there is stigma towards online gambling, or where there is a genuine problem of data breach.
This also puts more control in the hands of the player. When you have your money in your own wallet, and not in some platform account, you are more in control of your own money.
What This Means For the Future
Blockchain is not a payment system, it is a trust layer. It enables anyone to verify the data on their own, which removes the need of third parties, and enables transparent and timely transactions. It redefines the player-platform relationship in an important way.
Since the crypto regulation process is in its early stages, it is likely that blockchain-based gambling platforms will emerge as the new standard in the future. More rapid payments, less fees, open databases, and more control over personal data are not far-fetched ideas, and blockchain is able to offer it all.
