Harnessing the power of cryptocurrency to provide online gamblers with unparalleled transparency over payments, games, and operational compliance is the future for iGaming.
Crypto gambling currently has a market size of around $250 million and is growing exponentially as cryptocurrency is being adopted as a legitimate, safe payment method for gambling and beyond. Crypto wagers made up around 8.5% of sports betting GGR in 2021, and the total number of crypto bets increased by over 20% between 2022 and 2023.
Security and transparency are incredibly important in the context of banking and regulatory compliance generally. Within the context of crypto, blockchain is seen by many as an incorruptible ledger which vastly improves transparency.
Cryptocurrency is built using blockchain technology. The blockchain is decentralised, which increases transactional security and mitigates risks of fraud or interception. Cryptocurrencies are arguably one of the safest ways to make online casino deposits, despite being the least traditional and most ‘mysterious’ casino payment method.
I think it’s fair to say that broadly speaking, cryptocurrencies are still quite a niche concept in the iGaming industry. While the majority of the market still only operates with more traditional currencies, for those interested in crypto, there remains an opportunity to get ahead early and ride the wave.
The growth of crypto gambling
Fiat currency wagers still make up the majority share of worldwide gambling revenues. However, the landscape of online gambling payments is ever-changing, and more cryptocurrencies are slowly but surely beginning to increase in popularity.
Crypto casinos are actually very similar to all other online casinos; the main difference, of course, is the currency with which they trade. They face exactly the same challenges as those seen across the market when it comes to things like acquisition, retention, and product offerings.”
I don’t think it’s likely they will be as common as traditional casinos any time soon, as the dollar especially is much more recognised when it comes to cross-border transactions. However, crypto is important when it comes to segmentation.
Utilising crypto for online gambling
The pool of potential players is much smaller than at traditional retail or online casinos. The biggest challenges are similar to those you see across the online casino industry, but a more specific challenge would be how you target the specific type of audience that may wish to play with a crypto casino.
Even in countries that have the highest share of crypto penetration, the number is around 25%. Meanwhile, operators who serve multiple jurisdictions often encounter issues when attempting to implement cryptocurrency payments to their sites.
While crypto may be a large market when combining the geographies, it’s still not considered mainstream in any one geographical territory, so operators will have to work out how to split their marketing costs when trying to grow crypto casinos across the different territories.
One key to a successful crypto casino is to offer as many different currencies as possible. Many will already use Bitcoin and Ethereum. You have to expand on that while also ensuring that everything from the crypto wallet to the solutions that enable players to wager, deposit, and withdraw, are all second to none.
In 2023, around 74% of crypto gambling transactions were facilitated with Bitcoin, with Ethereum taking second place. Crypto casinos have become the latest innovation because they are set up well to provide a new kind of experience, and I think an important part of that is NFTs; this is where we are likely to see more innovation.
Using NFTs at crypto casinos
NFTs present distinct advantages when implemented at online casinos. For starters, they aren’t geographically restricted. They are not a fiat currency like a dollar or euro, or even an identical currency like Bitcoin or Ethereum, but are a one-of-a-kind, blockchain-based virtual asset. NFTs are programmable and can retain game information.
This provides the casino with even further transparency over the fairness of its games, potentially more so than an external auditor like eCOGRA can provide with its certificate of compliance and list of Return to Player (RTP) percentages. While RTPs are theoretical, NFTs can provide authentic evidence of the way a game plays out.
Another benefit of NFTs is that they are interoperable, meaning players can use them across multiple different games and platforms. This not only improves the overall user experience through seamless multichannel integration, but it also increases the investment potential of an NFT.
NFTs are set to become a mainstay of the crypto industry, and this is very important for us at iGP. We are set to announce a partnership with a new crypto casino, where we will be launching an NFT marketplace as part of the casino experience. We are very excited about the opportunities NFTs will bring and they will be key to the growth of crypto across the next few years.