Eilon Arad of BetcoinTech, one of the sponsors of the SBC Asia/Asia Gaming Brief Monsoon Meetup in Manilla on 4 September, explains what bitcoin can do for gambling operators.
Why should operators consider adding bitcoin?
Bitcoin is the perfect solution for the online gambling industry. Bitcoin is the biggest and most popular cryptocurrency which is best described as an encrypted online currency.
It has many advantages for both players and operators in the gaming industry such as:
- Anonymity – the identity of the parties involved in the transaction can be completely hidden.
- No chargebacks – Once a transaction was made there is no way back, this means – no chargebacks.
- Practically no transaction fees – There are no processing fees for this payment method merely a small transaction fee.
- Legal but not yet regulated – in most countries Bitcoin is legal but not yet regulated and not yet considered as a fiat (real money) currency. Operators in unregulated regions can highly benefit from this fact.
- Popular – There are currently 13,199,875 Bitcoins (BTC) in the market whereas a maximum total availability of 21 million once all coins will be mined. The current market worth is over 6.5 billion USD and since the supply is limited, the value is bound to rise. Bitcoin popularity is rising constantly as Bitcoin is a popular mean of transferring funds with low transaction costs and of course a great investment opportunity.
These reasons and many others makes it perfect for both existing operators as well as new operators and also for the players who seek anonymity and care about their privacy.
We at BetcoinTech offer a full turnkey solution to new operators who wish to take a Bitcoin brand, whether it’s a sportsbook, casino with live dealers and provably fair games which are fairly new and associated with Bitcoin gambling or poker and even standalone games, like bitcoin roulette, bitcoin dice, keno and so on.
What are the regulatory requirements and possible approaches that operators could take?
A license is required to operate in some regions anyway, and while most regulators didn’t yet take a stand about Bitcoin, an operator needs to be aware of current regulations in various countries and get updated with the changes. There are several big operators in the market who are accepting Bitcoin only (as well as other cryptocurrencies) as payment method and operate with no license. This is still a grey area which carries great opportunities much like online gambling at its initial stages.
How big is the bitcoin market and how fast is it growing?
The Bitcoin market is huge and currently worth over 6.5 billion USD in total market cap and most likely that the value (currently stands at 515 USD per 1 BTC) will rise due to increase demand and limited supply. At peak times the value was already at more than 1000 USD per 1 BTC, that was at the end of last year (2013). There is a lot of speculations but the bottom line is that more businesses are accepting Bitcoin as a payment method and more business in general is done with Bitcoin due to its many advantages.
If we are looking into the gambling market, analysts published in the past that Bitcoin accounts for almost half of all Bitcoin transactions.
Keep in mind that Bitcoin is still relatively new and was first introduced to the world back in 2009, in 5 years it managed to become this big so you can only imagine how the next 5 years are going to look like. The sky is the limit.
What is the lead time for integrating a bitcoin solution into an existing operation?
Integration is not complicated at all, it all depends on the way existing operators choose to work with the Bitcoin. There is an option of using a Bitcoin only account whereas the Bitcoin is not converted into a real money currency and then deposited and withdrawn as Bitcoin, and there is also the option of conversion. The operator will need to make a decision and we can provide the consultation to make right decision.
Another alternative is running a new and completely separate operation for Bitcoin or other cryptocurrencies.
Is the risk that’s attached to bitcoin overstated?
Definitely, Bitcoin has been around since 2009 and the market is constantly growing, furthermore the protocol is becoming more stable and secured as more and more people adapt the Bitcoin. I believe the future of the Bitcoin looks bright and that it’s going to become a main stream payment method for both operators and players altogether.