Can Blockchain-Based Casinos Fix the Trust Problem in iGaming?

The Trust Crisis in iGaming

You may have noticed that iGaming has been rapidly evolving. Unfortunately, so have the scams that operate parasitically on the industry. Years ago, gamers would be able to see if a site was a scam at a glance. These days, scam websites can be polished and hard to distinguish from the real thing. There are many sites that look legit, but can you really trust what you see?

Scammers are becoming more and more advanced in their ways of unlawfully getting money out of gamers. It is important to learn and understand ways that you can identify a scam site:

1. Licensing: A casino that operates within the law will always display its licence and licensing number on its website. If a casino does not hold a licence or isn’t listed by a regulating authority such as the UKGC, the casino is likely a scam.
2. Amateur Websites: Avoid websites that have broken graphics and games, and that are difficult to navigate.
3. Unrealistic Promotions: If a casino is offering a deal which sounds too good to be true, it most likely is. Always read the terms and conditions before opting for any deals.
4. Customer Support: If the customer support you receive is poor when discussing anything related to finances, it’s a major red flag.
5. Withdrawal Delays: If a website is unreasonably blocking and delaying withdrawals, it is most likely an untrustworthy site.

There are so many scam websites that it is tricky for players to find something that is legit. Some scam sites have even started to pose as famous people to help promote their websites. One such scam was where a casino site used deepfakes of the popular YouTuber Mr Beast to advertise their website.

You must verify any casino or game that you play to avoid becoming a victim of a scam. Do your research into game providers and payment methods before putting money into anything. It is worth looking at reviews to see what other people are saying about them. Usually, if a site is suspicious, someone will have raised this on a forum like TrustPilot or Reddit.

How Blockchain Casinos Can Address Trust Issues

Blockchain technology’s implementation in the iGaming industry is starting to grow rapidly. This is to counteract issues players may have encountered. In the past, online casinos have had problems relating to legitimisation, manipulated games, and shady withdrawal processes. However, blockchain technology is now being used to counteract this as it offers full clarity on games and payments. Although the technology is relatively new, many casinos are now referring to it as a trustworthy alternative to previous casino business practices.

By using blockchain technology, online casinos can build a fairer and safer space for gamers to play their favourite games.

Blockchain casinos can use provably fair games, meaning games that cannot be manipulated by any individual, to ensure that the game is entirely fair and just. This cuts out being able to cheat on games and creates a transparent space.

Payments on the blockchain are fast, and every transaction is recorded. This eliminates money being withheld from players as they can track its every move. It also means that players do not have to depend on the casino releasing their funds and minimises the chances of money being lost.

Many banks (and some online casinos) charge their customers for moving money. As cryptocurrencies are decentralised, they do not work within the traditional banking system, meaning that these transfer fees are eliminated.

A lot of crypto casinos provide wager-free promotions or make wagering requirements visible for site users. This removes one of the biggest gripes with traditional casinos: secretive terms and conditions and traps to catch people when cashing out. The technology also gives the players greater control, as they take ownership of their funds, which means there is less reliance on casino operators to release them.

Although there are many benefits to playing at crypto casinos, there are also disadvantages which players should be made aware of.

The crypto space is in a regulatory grey area in the United Kingdom, and many people do not like the fact that it operates outside of standard banking regulations. A lot of people also take issue with the fact that most online casinos are licensed offshore in countries such as Curacao and Comoros, meaning that players’ finances are less protected.

Unlike traditional banking methods, using the blockchain to make transactions offers anonymity. This may be seen as a positive, but it makes unlawful transactions harder to trace.

The blockchain is taking huge strides to make iGaming companies more transparent and helping to restore trust from gamers. To be fully protected from those trying to harm them, gamers need these sites to be regulated. Crypto technology can assist, but measures must be put in place so that all these spaces can be as fair as humanly possible. These could include things such as KYC compliance using the blockchain, auditing assurance, consumer protection, and more.

Challenges and Risks

With any new technology, there are pros and cons to using it.

The use of cryptocurrencies is a grey area within the United Kingdom. The UKGC currently doesn’t outright ban using cryptocurrencies at online casinos, but it makes sure that they comply with Anti-Money Laundering and Know Your Customer laws.

The anonymity of the blockchain makes player identification harder, as anyone can sign up to the blockchain as anyone they like. As KYC laws state, casinos must verify the identification of all players before they can withdraw funds from the site. Many UK licensed casinos like to stay clear of cryptocurrencies being used on their platforms or place limits due to the risks that they can pose.

The unclear nature of the regulations placed on blockchain technology being used within the iGaming sector can confuse players and have a knock-on effect on the trust of cryptocurrencies.

Casinos licensed in countries where regulations are less strict create a multitude of problems for players. They can avoid regulations within the UK, meaning that there are fewer safeguarding measures put in place. Players can be exposed to more risks when discussing issues such as transparency and fairness.

UK-based players can still access platforms that are licensed in countries with fewer regulations, but they open themselves up to problems as these sites are either under- or unregulated within the UK. Many casinos without a UKGC license are deemed “unlicensed”, which leaves little protection for the people spending their money on the platforms.

With the rise of new technology, new threats will arise that are harmful to its users. In the case of cryptocurrencies, these threats are those of cybersecurity. Using crypto brings with it the risk of being exposed to new methods of being scammed. Wallet hacks and phishing scams are now more prevalent than ever, with cybercriminals using these techniques to steal money from holders.

To prevent this, players must use secure services such as Coinbase and Ledger to protect their funds. These platforms are trustworthy spaces to store cryptocurrencies.

People wanting to use cryptocurrencies to play also need to be aware of the fact that transactions are irreversible, and once your money has been sent, it is impossible to get it back. Players should take this into account and use caution when spending any money at a blockchain-based casino.

The Future of Blockchain in iGaming

The blockchain is an ever-evolving entity, and newer tech is being implemented, which will change the shape of how it is used within the iGaming industry.

For better or for worse, AI is becoming an ever bigger presence within the world, and it has a rapid impact on the blockchain. AI monitoring is being used to create insights, oversee data, and create a more trustworthy economy. Hybrid blockchain models are also being produced so that different companies can share the data that is stored on their servers. This will create a more transparent understanding of how cryptocurrencies are being used in iGaming. Cryptocurrencies have boomed in popularity over the last few years, and now governments are starting to regulate them, which means more protection for holders.

If the blockchain becomes mainstream, this will mean that more sanctions and regulations will be placed upon it. There will be fewer potential risks for holders, and they will have more protection when using platforms like crypto casinos. Globally, crypto casinos are starting to become more acceptable, and this could change the way that casinos are licensed across the board. For example, within the United Kingdom, the UKGC will have to adapt its outlook on these sites as they are becoming increasingly more popular.

The blockchain might not be an instant solution to the problems that the iGaming industry has been facing, but with advancements made in technology and regulations, we might see many improvements being made to the iGaming industry.