The well-known investor Mark Mobius once compared the first cryptocurrency to casino games. Even though he had in his mind the risky nature of cryptocurrency investments, this statement is right in many ways. Gambling and cryptocurrencies have a lot in common, especially after the emergence of crypto casinos. Since the launch of the first Bitcoin casino, a decade has passed changing the nature of virtual gambling.
First BTC Casinos
The first crypto platforms for gambling were launched in 2011 when there was a worldwide boom for every service related to virtual money. At that time, the first gambling providers offered their visitors to bet in Bitcoins. The uniqueness of the proposal was so amazing because the gambler earned not only on stakes but also on the continuously changing rate of the cryptocurrency. This made bitcoin iGaming in Japan and other states extremely popular.
Since most of the sites were technically poor, the implementation of a new depositing method took some time:
- The operators announced the possibility of replenishing the account with tokens – during the transfer, digital coins were converted into the account currency.
- Then, it became possible to maintain a cryptocurrency account. All calculations were carried out in tokens, but gambling bets were still made in fiat money.
- The first slot machines accepting Bitcoin appeared. This led to a revolution in the field of gambling – clients could completely switch to tokens without losing the exchange rate difference during conversion.
Initially, all schemes were tested only on Bitcoins, since it was the first blockchain platform, and others began to appear only in 2013. Over time, Ethereum, Litecoin, Ripple, and other tokens were added to the list of available currencies for account management. However, the most advanced improvement in the gambling industry caused blockchain casinos.
How Do Blockchain Casinos Work?
Blockchain casinos use smart contracts to record transactions on the blockchain, while tokens are analogous to chips. In this way, blockchain guarantees the transparency of the gameplay. All the clients’ and BTC casinos’ actions can be tracked in the public register. This information can be checked, but the gambling provider cannot change it. Besides, such an establishment has a couple of other advantages:
1) It shows the provider’s balance
Blockchain platforms use smart contracts to pay the winnings back to the gambler’s account. Each smart contract has its own blockchain address and is publicly available. Visitors are free to check the provider’s balance and the payoff records using the block explorer.
2) It guarantees the fair play
Gambling platforms purchase software from the developers. The responsible bodies regularly check the fairness of the game provided. They make thousands and millions of bets to calculate the return-to-player rate, however, gamblers themselves cannot check this data. The RTP rate indicates the percentage of possible winnings. For example, a gambling platform will pay back 96% of bets to the players, by earning only 4% of the whole amount. Blockchain platforms automatically record all the stakes and their results, so the RTP can be easily verified by blockchain technology.
3) It doesn’t cheat affiliates
Casinos often involve affiliates in advertising their services. They advertise a certain casino and get a fixed percentage of players’ deposits, who came to the platform via a referral link. Unfair casinos may cheat their partners with a remuneration paid: they simply set higher withdrawal limits and remove info on attracted gamblers. In blockchain casinos, statistics on attracted players are recorded in a public register, and affiliates can check this information.
As you can see, cryptocurrencies and blockchain technology made a real revolution in the gambling industry. Perhaps, these platforms are the best among the alternatives.