Cryptocurrency casinos are online applications that use cryptocurrencies to facilitate online gambling, and most are designed to guarantee true randomness for players while leveraging the security and (partial) anonymity of cryptocurrency. Because cryptocurrencies do not discriminate between their holders or recipients, and can be programmed to automatically move between crypto wallets when the right conditions are met, they are perfect for use in online gambling and betting apps.
It is well known now that all real world casinos must operate with a “house edge”, which is required to pay for the fixed costs of running the casino. This effectively guarantees that players will always lose more than they win if they keep playing long enough. Online casinos do not have the same fixed expenses as physical casinos, thanks to the fact that they do not need to budget for maintenance, salaries, utility bills or property taxes. However, online casinos have another problem – they have to process and protect players’ banking information securely, and they have to follow strict KYC rules or face lawsuits as illegal gambling apps. Online casinos must therefore collect and store personally identifiable information about all of their customers, which carries the risk of data leaks that could harm their customers.
This is where cryptocurrency bypasses all of these issues, for better or for worse. In accordance Crypto updates, cryptocasinos are safer than real casinos because they allow players to maintain their anonymity and provide assurance that players’ banking or contact information will not be leaked from the casino’s database, and that players’ banking institutions cannot interfere with their choice to play. Cryptocasinos also do not need to maintain a corporate account or any payment channels, since cryptocurrency is both its own account and payment channel, and is unable to discriminate between sender or receiver. Crypto casinos can also be run automatically with no profit margins using cryptocurrency and blockchain smart contracts, allowing them to provide fair odds of winning or losing to their players, as the only expense required to run them is the cost of the web server that hosts the casino website and the bot that manages crypto wallets.
Crypto casinos are fairer and more transparent
Because a crypto casino requires very little overhead and maintenance, the creator can afford to make the games truly fair by offering true randomness. In contrast, real casinos jealously guard the algorithms that run slot machines, and will intervene when a player wins too much at card games. Because cryptocurrency is the only method of value exchange, withdrawing crypto winnings is much easier and safer than withdrawing money to a bank account, as banks may have problems with customers’ gambling activities and may freeze or close their account without warning or explanation.
However, like most things in blockchain technology, cryptocasinos run into regulatory issues. In accordance BetAndBeat, online casinos must enforce KYC (Know Your Customer) regulations to stop underage gambling, addictive gambling and money laundering. However, cryptocasinos may not enforce KYC regulations due to financial constraints or because the creators’ jurisdiction does not require them, and it is very difficult to bring such casinos into compliance with the regulations. Until blockchain identity systems or ID-NFTs are used, there will be no secure way to enforce KYC rules for automated cryptocasinos without risking a leak of customers’ information.
Crypto casinos are better than real casinos because they can guarantee fair results for players, protect players’ identities and provide a safe and secure way to send and receive money and winnings. Because they are completely online and use cryptocurrencies, their overhead expenses are limited to the monthly costs of keeping a website and server scripts running, and they can operate autonomously. However, cryptocasinos face regulatory issues that could lead to enforcement, as many offshore cryptocasinos do not follow US KYC regulations, meaning underage players and gambling addicts can easily and illegally access cryptocurrency casinos.
Source: The Crypto Updates, BetAndBeat
