For fans of online casino gaming, new payment methods like cryptocurrencies can make a difference in where they choose to play. For a variety of reasons, crypto casinos are rising in popularity, and more platforms are offering cryptocurrency as both payment and withdrawal methods. Regulatory bodies are struggling to keep up with the growth of these platforms and how they should be treated.
Cryptocurrency has been a disruptive force across many digital industries, and the online gambling ecosystem has not gotten away unchanged. The rising popularity of online platforms that allow players to pay and withdraw using cryptocurrencies has surprised many industry stakeholders. For operators of online casino platforms, players and regulators, being aware and responsive to the changing digital market for online casino platforms includes understanding how crypto casino platforms work.
While it's fair to say that cryptocurrency has been disruptive for the online gambling industry, it hasn't completely rewritten it. Crypto casinos are just one of the many facets of the online gambling ecosystem, and in a new report by Erik King, popular payment methods like crypto, among other metrics, are used to track the functionality and usability of different online casino platforms. But why do people like crypto casinos so much? Who is playing at them? And what difficulties are regulators experiencing in trying to keep up with them?
While it would take much more time than we have available to write an exhaustive breakdown of all the different reasons that crypto casinos are gaining popularity, there are 3 main points that speak to their rise.
Perhaps the biggest draw for many people of crypto casino gaming is that the withdrawals and payments are simply quicker. Because they are typically driven by blockchain technology, the speed of transactions is much faster than just about every other payment method. Add to this the ability, on most crypto casinos, to pay with a variety of different cryptocurrencies, and you have fast and flexible payment options. The lack of friction in payments and withdrawals is something that every online casino gamer enjoys.
While other types of online casino platforms, particularly those that offer card games or live-dealer games, might be more attractive to an older audience, younger demographics are often more interested in crypto casinos. Being aligned with the tech-savvy younger audience, crypto casinos are able to capture the interest of those demographics with greater ease. These younger demographics are more likely to innately understand and have familiarity with cryptocurrency, making them more likely to engage with crypto casinos than other demographics.
Once again, because of their reliance on blockchain, crypto casinos can promise a greater level of anonymity than online casino platforms that use more traditional payment methods. Cryptocurrency is also a payment method that never loses value when being taken across borders. This means that players who travel often or who like to play in different geographical markets don't have to worry about or keep track of currency fluctuations or restrictions when they play.
Once again, it is difficult to exhaustively determine what sorts of issues regulators have with crypto casinos. But there are a number of themes that crop up again and again in different regulatory environments when crypto casinos are on the agenda.
A key component of the difficulty for many regulatory bodies is that cryptocurrencies and crypto casinos lie outside of the existing legal framework. They don't quite fit the bill of existing online gambling platforms, the licensing phraseology doesn't seem relevant for them, and the type of asset that cryptocurrencies are considered can be an issue.
Some regulatory environments are simply insisting that crypto casino operators must hold normal casino licenses, while others are taking steps to re-classify exactly what sort of asset cryptocurrency is, in order to properly regulate crypto casinos.
One of the very reasons that some people gravitate towards crypto casinos is exactly the same reasons that many regulators have issues with them. With the anonymity and cross-border accessibility of cryptocurrency, anti-money laundering (AML) and know your customer (KYC) protocols are all but impossible to enact in the same way as they are at other online gambling platforms.
In some cases, regulatory bodies aren't bothering to rewrite anything. They simply choose to ban and enforce regulatory penalties against crypto casinos. In some cases, these platforms have seen attempts to block the flow of payment or to identify the operators in order to levy regulatory penalties against them.
While crypto casino platforms tout their provably fair games, many regulatory agencies claim that it isn't enough. These regulators demand that the same measures that other casino platforms must operate under need to exist for crypto casinos as well. These include responsible gambling measures, player protections, clear terms and conditions, and age verification software.
One of the stories that is common across the entire online gambling world is the lack of cross-border coordination. The regulatory environment in one country is likely to be wildly different to that in another. This issue is exacerbated with crypto casino platforms. Not only are the regulations for gambling often different, but so too are the laws surrounding cryptocurrencies.
As crypto casinos continue to rise in popularity, the desperation of regulatory bodies to keep up with them will increase. It seems likely that at a certain point that many regulatory environments will come to terms with and find ways to successfully handle crypto casino platforms within their frameworks.
For now, in many regions, crypto casino platforms still exist in somewhat of a limbo. The technology that they use is still too new to have been properly anticipated and regulated.
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