How Betting Sites and Online Casinos are adopting Cryptocurrency

The online gambling industry is still relatively new, with the first internet gambling site introduced in the mid-90s. Although it’s still in its infancy, the market is growing rapidly. According to a report by Research and Markets, it is expected to reach $72.02 billion by the end of 2021, at a compound annual growth rate (CAGR) of 12.3%.

Read: Cryptocurrencies that stand to outperform others

Cryptocurrency & Online Gambling/Betting

A recent trend in the online gambling industry has been the adoption of blockchain technology. Bitcoin paved the way for this change as the first blockchain-based currency adopted by casinos in May 2012. This was shortly followed by other popular digital currencies, including XRP Ripple and Ethereum. We’ve recently seen the emergence of new cryptocurrencies, specifically for the online gaming industry, such as Casino Coin. 

Cryptocurrency casinos allow people to deposit money and withdraw their earnings in digital currencies. These casinos/betting have completely revolutionised the industry as more people are reaping the benefits of their use.

Read: How Blockchain and Cryptocurrency is changing the world: Crypto Use Cases

Benefits of Casinos and Players Using Cryptocurrency

Increased Security

Many people who gamble online fear that they may be at risk of their banking information being stolen by fraudsters. This year, Experian found that the surge of online gambling during the global pandemic increased online fraudulent activity. 

Anyone who understands how cryptocurrency works will likely know some of the benefits of blockchain technology. Blockchain can be defined as a database of information that records the provenance of a digital asset in a way that makes it very difficult to change. It is a digital ledger of transactions and provides an open database of every transaction involving value.

This makes using this technology extremely secure. Cryptocurrency is easy to track as each transaction comes with its own unique identifier code. However, it is impossible to manipulate these transactions because all digital currencies are encrypted. This ensures that payments made using blockchain technology are safer than traditional currencies. It also reduces an internet users’ chance of making unauthorised transactions. 

Sports Betting:

Sports betting has been part of our culture since ancient times. However, a lot has changed from the days when gamblers bet on gladiatorial fights to when gamblers nowadays are betting online from the comfort of their couches.

According to a study, the global online gambling and betting market was valued at $ 50 billion in 2019 and is projected to reach $ 100 billion by 2026. The global online gambling and betting market is expected to grow at an average annual growth rate of 10% from 2019 to 2026.

Following a successful September launch, Wyoming became one of the latest states to offer a regulated sports betting market to those within state lines. Yet, while Wyoming is the least populous state in the country, it is catching the attention of sportsbook operators, largely thanks to its decision to allow the use of blockchain technology for sports betting transactions.

The federal ban on sports betting was repealed on May 14, 2018, when the United Supreme Court struck down the Professional and Amateur Sports Protection Act (PASPA). Three years later, some form of sports betting is now regulated in now legalized in 26 states and Washington, D.C.

While most states where sports betting is legal allow for a similar framework, this rapid expansion has seen each jurisdiction attempt to find the perfect formula needed to offer consumers a competitive marketplace while capitalizing off of the taxable revenue.

Interestingly enough it took more than three years for a state to draft legislation that would permit the use of cryptocurrencies.

Wyoming sports betting law allows players to deposit funds into their accounts with a variety of crypto and digital currencies, with Bitcoin remaining the most popular option. Per House bill 133, Wyoming sports betting shops may accept “digital, crypto and virtual currencies” as long as they can be converted into a cash-based currency.

State legislators have decided to embrace the advancement of blockchain technology, and a number of crypto-friendly bills have been approved in hopes of attracting crypto businesses to the state. So common are the crypto conversations in Wyoming’s Senate chambers that Senator Jeff Wasserburger claims there “was very little discussion” when it came to the inclusion of crypto-friendly language in the state’s sports betting bill.

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A player’s ability to deposit with crypto might not seem ground-breaking, but Wyoming has essentially given the operators the green light to begin experimenting with the technology. What starts with improved funding and withdrawal methods could quickly lead to an entirely new experience for bettors all together.

Blockchain & New Tech Will Revolutionize Sports Betting Industry

Sports betting is a multi-billion-dollar industry, and estimates from Forbes project that the United States could generate annual revenue in excess of $20 billion alone if all 50 states pass legislation.

Gamma Stack CEO Mr. Gaurav Soni has always rooted for crypto and blockchain based sports betting software solutions and online casino software solutions.

"There is already a massive demand in crypto and blockchain based betting and gambling software solutions around the globe. 35% of the queries we receive revolve around the same."

Blockchain technology has revolutionized financial transactions, and many suspects that sports betting software would greatly benefit from its adaptation into the industry. Players are always looking for faster and safer ways to transfer money, and sportsbooks could greatly reduce operational costs if they were able to sidestep traditional credit card processing fees.

Lower operational costs either allow the book to operate with better margins, leading to more taxable revenue. These savings could also be extended to the consumer in the form of more competitive wagering lines.

In essence, sportsbooks serve as betting exchanges where the odds move one way or another in reaction to the amount of interest or money coming in on a particular outcome. Most American operators have already partnered with a number of companies to support everything from data acquisition, wagering software, geo-fencing, and casino software solutions. It isn’t far-fetched to anticipate a time where sportsbooks would partner with crypto exchanges to develop platforms allowing them to serve as digital wallets, allowing players to exchange digital currencies and even wager against other players with their holdings.

Hypothetically, a customer could hold a number of coins in his sportsbook wallet and still play the crypto markets, all while having the ability to quickly place a wager with their coin of choice without ever having to leave the platform.

DraftKings recently made the news with their decision to open up an NFT exchange in a partnership with Autograph. The blockchain exchange allows players to participate in specialized drops, buy and sell sports-themed NFTs, and participate in free-to-play competitions in exchange for digital property.

In doing so, DraftKings has turned to blockchain technology to create a unique and exclusive environment for subscribers, and one that gives their marketing team direct access to potential bettors.

Legislation is sure to change as sportsbooks further invest in the exploration of blockchain technology and its potential uses in the sports betting industry. While crypto’s involvement in the industry is limited to player deposits in the country’s smallest state, Wyoming’s legal framework has opened the door for the entire market.