A year ago, the average man or woman in the street had never even heard of Bitcoin, yet today, there are cryptocurrency headlines all over the popular press. Part of this is no doubt down to recent events in Japanand there is also the fact that prices have been skyrocketing since the beginning of the year at a rate unseen since 2013. On that occasion, a dramatic rise was followed by an inglorious fall, but four years on, the sector has reached a stage of maturity where many expect the growth to be sustainable.
A whole variety of industries are now beginning to take Bitcoin seriously as a payment method, and this will only serve to increase its profile, popularity and value. But the industry that stands to gain most is the online gambling world. As the number of online casinos that accept Bitcoin rises, new doors are being opened that bring greater opportunities to both the casinos themselves and the gamblers who visit them.
Broader customer base
Perhaps the biggest impact of the Bitcoin revolution is that it potentially opens the doors to some truly staggering new markets. The USA has always had a strange relationship with gambling. On the one hand, it is home to Las Vegas – need we say more? But on the other hand, most states do not allow casinos, and there are some strange laws surrounding online gambling.
Put simply, the Unlawful Internet Gaming Enforcement Act states that US banks are prohibited from processing payments to gambling sites. There is an important distinction here – it is not illegal for a gambler to pay money to a gambling site, but it is unlawful for a US bank to process such a payment. This has led to US citizens seeking all sorts of workarounds, such as Western Union money transfers and prepaid debit cards, all of which have ultimately been blocked.
There is nothing the authorities can do to restrict the use of Bitcoin, however – at least not yet – and this looks like the most promising method yet for allowing those in the USA, Russia and other countries with these sorts of limitations, to enter the world of online casinos.
Another major draw of the Bitcoin casinos is that all winnings are tax free. While most jurisdictions (such as the USA) levy taxes on both physical and online casinos, the fact that Bitcoin transactions have the anonymity factor mean that it is currently impossible to tax your winnings.
The strength of Bitcoin against physical currencies means the potential gains are huge. And these are amplified further by the fact that Bitcoin casinos are operating at a far lower edge They can afford to do this because their overheads are so low, and they can bring in more than enough revenue to be highly profitable through advertising, data sharing and selling premium services.
The future of casinos?
With all these advantages, you might think the days of conventional casinos are numbered. However, it should be noted that the tax and payment loopholes will not necessarily last forever. Increased regulation is certain to be forthcoming, as the lawmakers work to catch up with the technology. In the meantime, however, Bitcoin presents huge advantages to everyone involved in online casinos.
Gambling image via Shutterstock.