Crypto Settlements in the iGaming Sector: a Detailed Review

The forecasts by the PwC international audit and consulting corporation show that global GDP will reach $1.76 trillion by 2030 only through the use of blockchain. Digital assets are already changing many sectors of the economy, including the casino entertainment niche.

Experts of the CASEXE studio will tell you about the benefits and prospects of using crypto payments in the gambling sphere, why the option attracts players and investors, as well as how the world’s leading brands regulate such transfers.

What Are Digital Assets

This is the type of money that uses decentralised protocols for secure financial transactions based on distributed ledger technology. All operations are verified by several anonymous participants, so there is no doubt about their authenticity.

Verification and subsequent encryption of data is carried out via cryptographic protocols. For Bitcoin, the SHA-256 algorithm is used, the Script tool is provided for Ethereum, etc.

People can use hundreds of currencies. They all have unique features and tasks. Each digital asset performs its functions, from facilitating smart contracts to enabling fast cross-border transactions.

Today, the use of virtual money has become widespread. They can be found in the financial, construction, logistics, retail, tourism, and gambling sectors.

The Ripple Internet platform provides the following statistics:

$10 billion

The financial benefit of international enterprises that have introduced cryptocurrency into their projects

93%

The percentage of central banks that issue their digital funds

$19,4 billion

Gobal blockchain learning costs are estimated

The list of the top 5 most famous cryptocurrency investors includes:

Corporations are engaged in mining, the implementation of ICO projects, software development, business analytics, processing of payments in digital assets, etc.

In the casino market, the benefits of introducing such settlements have already been evaluated by Evolution, Microgaming, BGaming, UltraPlay, and other well-known companies.

Advantages of Crypto Payments in Gambling

Let us consider why many entrepreneurs add this option to their platforms and bookmakers’ offices.

Financial Freedom

One of the main reasons for the popularity of digital currency is the concept of economic independence.

Blockchain, the basic option, is characterised by its decentralised nature. Thanks to this, users (players, operators, and B2B partners) can make transfers directly between themselves. They bypass numerous intermediaries, such as:

• banks;
• financial institutions;
• customs authorities, and other regulatory bodies.

All this speeds up and simplifies the process of conducting transactions for entrepreneurs and individuals. The absence of third parties qualitatively affects the speed of operations. The money is instantly credited to the recipient's account without additional checks or approvals.

Security and Privacy

All transfers are encrypted and written to the blockchain. Anyone can view the transaction history but nobody can make changes to the registry. This approach makes any manipulation with payments impossible, including theft of money or confidential information disclosure.

Moreover, the addition of crypto settlements increases the efficiency of risk management.

Gambling is exposed to the risks of fraud and chargebacks more than other sectors of the economy. According to a ClearSale study, 30% of players report illegal activities with their bank cards. Each case requires individual consideration, which significantly increases the load on the technical support service.

The introduction of crypto payments eliminates all difficulties associated with transfers. They can be quickly tracked to identify criminals among honest clients and business partners.

Cross-Border Nature

Digital money opens up new opportunities for users all over the world who previously had limited access to financial services or casino entertainment. Blockchain blurs the lines between countries, allowing project owners to interact with customers from various locations.

According to a Forrester Consulting study, brands that offer crypto settlements can:

• receive 40% more in deposits from new clients;
• double their average check;
• receive impressive ROI and net profit growth compared to those who only accept fiat money.

The statistics are true for many sectors of the economy, including the entertainment sphere. In many countries (for example, India), gambling is in a grey area. Using cryptocurrency in such territories is almost the only way to attract solvent traffic and not lose valuable customers.

Technological Advances

The popularisation of digital assets is closely related to innovation and blockchain. The introduction of a peer-to-peer distributed network into an online casino or a bookmaker’s office makes the platform more modern, adaptive, and resistant to external and internal threats.

The technology not only enables fast transactions but is also used to develop:

• game content;
• control systems;
• bonus programs, and other components.

Blockchain propels entertainment to the next level, allows clients to manage the gameplay, and improves their user experience.

For example, the Provably Fair solution is actively used in many online casinos. The product is based on cryptography. It also guarantees that the platform is trustworthy and does not manipulate the formation of winning combinations or the payout of prizes.

Stability

The cryptocurrency rate is sometimes unpredictable but among the wide variety of options, there are several reliable tokens. They remain more or less stable, which is why players are happy to use them. Operators need digital assets to pay their B2B partners, such as:

• hosting providers;
• game developers;
• affiliates, etc.

Apart from good volatility, gamblers are also attracted by the wide range of crypto bets: they can spend from 0.00001 to 1 BTC on one spin. Much depends on the selected strategy of a particular user and their willingness to take risks and win.

Minimum Commission

Banking systems and electronic wallets charge a large transfer fee. Payment gateways that support digital assets eliminate all intermediaries, significantly reducing transaction costs.

Such well-known fiat services as PayPal, Neteller, or Skrill take from 2.5 to 4% for each operation. The use of cryptocurrency practically minimises these fees, which is a big advantage, especially for new iGaming startups.

Legal Attraction of Investments

The solution completely changes the way casino projects are financed. Thus, traditional ways of building up the capital (buying shares or bonds) can be replaced by the issuance of blockchain-based tokens. Thanks to this, companies will receive funding directly from B2B partners, which ensures greater openness and transparency.

Innovative ICO contracts (Initial Coin Offering) allow entrepreneurs to attract investors by selling them currency in exchange for their future products or services. Many startups are already actively using ICO mechanisms because they do not have access to traditional sources of financing: bank loans and government grants.

Legalisation of Blockchain Transactions

There is no single approach to the regulation of crypto settlements. While some countries have already resolved the issue at the legislative level, others have just started considering this method.

Offshore Jurisdictions

In such zones, the most favourable business climate for blockchain projects has been created. In most of them (Alderney, Curacao, Gibraltar, etc.), gambling is absolutely legal.

The Isle of Man is a leader in the field of casino innovations based on distributed ledger technology. In 2015, the regulator was the first to include operations of this type in the anti-money laundering law. In 2017, it allowed business owners to accept deposits and pay winnings in cryptocurrency.

The country grants licences to B2B companies that produce blockchain software. It includes games, financial services, and turnkey platforms. Voluntary certification of providers has been in effect since 2019.

In 2024, large-scale changes await Curacao. The island's Ministry of Finance wants to legalise settlements in digital assets and introduce blockchain payments into AML protocols.

Europe

The attitude toward crypto transactions varies depending on the country:

1. Malta. It has been using the technology since 2017. Entrepreneurs are allowed to use virtual money to transfer money to clients and B2B partners. The technology is actively used in many sectors of the economy, including gambling.
2. Estonia. Businessmen can legally use cryptocurrency. To work legally, they need to obtain 2 permits: to provide online casino services and conduct blockchain operations. The first document is issued by the Gambling Commission and the second by the local financial intelligence unit. In accordance with the decision of the European Court, such transactions are not subject to VAT.
3. Portugal. The region is actively introducing technology into government services, healthcare, and supply-chain management. BTC can also be used to pay bills and taxes. The operation of blockchain casinos and crypto exchanges is also allowed, which increases the attractiveness of the jurisdiction for foreign investors.
4. Switzerland. According to the local tax office, digital money can be legally bought, sold, or traded. However, each type of activity requires a separate permit.

USA

In this country, cryptocurrency is considered a means of payment along with stocks, bonds, and other financial instruments.

Blockchain companies are required to comply with the laws on:

• bank secrecy;
• anti-money laundering (AML);
• prevention of terrorism financing (CTF).

To work legally, entrepreneurs must register with FinCEN. They also need to obtain a licence to operate an online casino or a bookmaker’s office. The industry is regulated at the state level.

All cryptocurrency trades in the US are subject to taxes, including the payment of:

• wages;
• B2B services;
• prize money, etc.

The Main Things about Popularisation of Digital Assets

Distributed ledger technology is extremely important for the industry and can be called a catalyst for its development.

Key features of the solution:

• Every year, the volume of such settlements is only increasing. People are attracted by the speed of transactions, their anonymity, and accessibility from anywhere in the world.
• Integration of the option is beneficial to the owners of both online casinos and sportsbook platforms. Crypto payments give companies financial freedom, open access to investments, reduce ongoing commission fees, and make portals more advanced and resistant to fraud.
• The approach to digital asset legalisation varies depending on the country. The most favourable conditions have been created in Malta, Estonia, Curacao, and other jurisdictions where all types of iGaming entertainment are allowed.

The CASEXE studio offers its clients the following useful services:

• certified software development;
• payment system integration;
• creation of a VR casino;
• promotion of a platform;
• installation of security program components, and much more.