When online sports betting launched in New Jersey on August 2018, it was greeted with great fanfare. Coming on the heels of the landmark decision by the United States Supreme Court to effectively let individual states choose their own legal gambling statuses, New Jersey was the first to launch a fully rounded online industry.
The launches of the sportsbooks and online casinos were a mixture of the Las Vegas and Atlantic City resorts – Caesars, Golden Nugget, etc. – and the big European operators. Restrictions in the states are serious, however, and state of the art geolocation technology was used to ensure that anyone registering to place a bet was located within the Garden State.
Yet, many players encountered a problem in the first few months – making deposit and withdrawals. While it turned out the iGaming operators had been spending time, energy and money ensuring they could legally meet the location requirements. Banks and credit card companies, however, did not, and they erred on the side of caution by blocking payments.
Major Operators Look to Diversify Options
The situation seems to have resolved, but it still serves as a reminder that the betting and gaming industry, in general, does not put a huge emphasis on payment methods. Sure, you can find major operators like Mansion Group’s flagship site, www.mansioncasino.com, which offer a good range of non-traditional methods like Boku, iDeal and Paysafecard, but, in general, the payment methods are given secondary consideration to the betting markets, games and other elements of iGaming.
That’s not a criticism, as such, but for those interested in cryptocurrency, it represents a bit of an issue. Yes, you can find an online casino and betting sites that accept bitcoin and another crypto, but they are sites set up for that very purpose. The games on offer might be to your taste, but they are often not the big blockbuster games from the big developers like NetEnt, Playtech, and Microgaming.
And, it still comes back to the fact that the big iGaming operators and betting sites see a problem with crypto. As you would expect, most of that comes down to the volatility – of both the perceived kind and real volatility. Despite casinos having that “the house always wins” mantra, it is misunderstood just how fine those margins are. In blackjack, for example, the house edge can be as low as 0.03%. That’s a slim figure, so you can appreciate that casinos can be reluctant to gamble with a cryptocurrency that could bounce around in value by a 5-10 percent in a matter of hours.
Regulation Will Be Key to Operators’ Attitudes
Aside from the volatility, it’s possible that big gaming companies are hedging their bets in another area – regulation. In countries with liberal gaming laws and booming gambling industries like Canada, the UK, and Ireland, there are many signs that authorities are putting pressure on gaming companies to do more to combat fraud and money laundering. There is a lot of focus on Know Your Customer policies, credit checks and so on. This is the antithesis of the cryptocurrency’s decentralized raison d’être.
Across different parliaments in many different countries in Europe and North America, there are bills waiting to tighten the regulations in the gaming industry in these areas of transparency. We are also seeing the start of a dialogue on the regulation of crypto, certainly if other governments are influenced by the feelings of US President Donald Trump and Treasury Secretary Steve Mnuchin.
The point is that the major gaming operators are likely to have a “wait and see” attitude to accepting cryptocurrency, rather than a proactive one. They will be reluctant to see up the mechanisms for accepting and gaming with cryptocurrency, only to see those practices regulated out of existence in the coming years.
Eventually, just as with any type of commerce, betting and gaming with cryptocurrency is likely to be as ubiquitous as using a Visa or PayPal. But it still feels a long way off when it comes to the mainstream iGaming companies.