The ever-growing online gambling industry – evaluated at about $75 billion at the time of writing, the global online gambling market is expected to triple by the end of the decade – is prone to take advantage of new technologies, especially if the tech is as hyped and efficient as blockchain.

Bitcoin, Ethereum, and other cryptocurrencies have long been accepted by online casinos, but there are still many challenges to overcome before we can be sure about the bright future of cryptocurrencies in gambling. So what are those challenges, and how can you benefit from crypto in gambling right now? Let’s take a dive into the crypto-gambling multiverse along with Aleksandra Maj, a crypto enthusiast and gambling expert from KasynoHEX.

Provably Fair Casinos

Before crypto came about, it was impossible to verify the fairness of your casino, even if you were playing at a credible casino like Unibet, Energy Casino, or Slottica. You had to trust software testing agencies, which is nowhere near as convincing as being able to verify the fairness of the casino yourself – which is exactly what blockchain allows today.

There are three things at the core of any blockchain-based gambling:

1. Server Seed (generated by the casino).
2. User Seed (generated by the player).
3. Cryptographic Nonce – the number of your bet in the array of bets.

Now, while the Server Seed is only known to the casino and the User Sees is only known to the player, the combination of two creates a Seed Pair that generates the outcomes of the games played. The whole process is recorded in a blockchain and becomes verifiable after the casino shares the private key of its Server Seed.

At the same time, there’s a long way to go until Probably Fair casinos can be called spotless:

• First of all, contrary to the very philosophy of blockchain, the private key of the Server Seed is a single point of failure: if the player somehow gets to know it, then he can fully control the results of his spins, rolls, or dice throws.
• Secondly, a default Seed Pair offered by most casinos undermines the whole point of using blockchain for gambling. The Server Seed can be pre-generated, so only a newly generated Seed Pair makes sense from the player’s perspective.
• Last but not least, Provably Fair casinos can still have all the restrictions and limitations of their traditional counterparts. The very fact that the casino is provably fair doesn’t mean that it’s good in other aspects. 

That said, blockchain-based casinos are one of the few real applications of blockchain. The web is awash with articles on the use cases of blockchain, but in reality, it hasn’t yet gone much beyond crypto speculation if not to count online casinos.

Cryptocurrencies as a Payment Method

A pioneering cryptocurrency, Bitcoin has paved the way for crypto payments. The first crypto to be accepted by online merchants and casinos, it is now slow and too expensive to be used as a payment method…unless you’re willing to pay up to $50 for a single transaction when the network is congested or wait for several days until your payment is confirmed.

The congestion of the BTC network might be an insurmountable barrier for the first crypto as bitcoin maximalists have preferred Lightning Network to on-chain scaling. Again, there are tons of materials on how beautiful Lighting Network is, but at this point, it is by no means better than PayPal:

• You have to trust your counterpart on the payment channel.
• You have to collateralize some amount of BTC before making payments.
• The payment process is complex even for crypto users, let alone non-crypto-savvy people.

On a different note, there are lots of cryptos ready to dethrone Bitcoin both in terms of market capitalization and actual usage. Ethereum, Ripple, Binance Coin, Cardano, Bitcoin Cash, and even Dogecoin offer lower fees, faster transaction time, and at least the same level of anonymity. As for online casinos, they are glad to wait and see which cryptos will survive and attract more users.

Important: gambling may cause addiction. If you or your loved ones suffer from gambling addiction, immediately ask for help at international – BeGambleAware, GamCare, Gamblers Anonymous, etc. – or local problem gambling organisations.