Blockchain in Gambling: How Can the Industry Benefit From Innovative Technologies

Gambling has always been around: people have enjoyed trying their luck since ancient times. Just like all other activities, this one has changed a lot, especially in the 21st century, when modern technologies knocked on the door of each industry.

The most significant change was going online, but it could not cope with the main gambling problems — the lack of trust and a long way to getting the money you have won. Likely, blockchain technology is finally here to save the day.

How Blockchain Works in Gambling

Blockchain is a distributed ledger technology that records transactions across multiple computers. In the gambling sector, blockchain is used to create transparent and tamper-proof records of all transactions, including bets, payouts, and more. Here’s how it works:

• Transparency: Blockchain offers a clear and unchangeable ledger of all transactions. This means that every bet, payout, and game result is permanently recorded on the blockchain, preventing any alterations or tampering.
• Smart Contracts: Smart contracts are automated agreements in which the contract terms are ‘embedded’ directly into computer code. In gambling, smart contracts automate payouts based on predefined rules, providing fair and transparent gaming conditions.
• Decentralization: The decentralized nature of blockchain means that there is no central authority or single point of control, which makes it more resistant to fraudulent activities or manipulation.
• Provably Fair Gaming: With blockchain, every aspect of a bet, including its outcome, is recorded and can be publicly audited by anyone. This means that players can independently verify that the game’s results are random and not manipulated.

Benefits of Using Blockchain Technology in Gambling

Let’s take a closer look at the problems of online casinos and betting platforms and see how blockchain technology addresses them. Here are the main improvements blockchain offers to the gambling industry:

Transparency

People do not trust online casinos and betting services. They believe that the system itself is programmed to eliminate the possibility of winning and to steal their money. Institutions like banks also show no respect for gambling, and some of them can even close your account if you use it to make bets.

Blockchain allows everyone to see the history of all operations: who won and how much, when it happened, and whether a winner got the money.

Blockchain casinos and blockchain sports betting platforms also have crypto-empowered open-source algorithms that ensure that all the random generations eliminate fraud or any tricks.

Security

One of the main opportunities blockchain provides — enhanced security — perfectly works for the gambling industry, too. It eliminates fraud and ensures secure transactions, as well as prevents data from being changed or deleted.

So, the history of victories and payments is not only open but also well-protected and immutable.

Improved Payout Process

As for payments, the process of withdrawal has always been a challenge. In order to get the money, one could face the necessity to deal with different documents and intermediaries, as well as time delays.

Blockchain technology introduces smart contracts to the gambling industry. These are self-executing programs that perform certain actions (e.g., money transfer) when the required conditions are met.

So, empowered by blockchain, the process of getting money becomes fast and simple.

Cryptocurrency Availability

In the public mind, blockchain is tied to cryptocurrencies, and in the case of gambling, it is an appropriate association.

Blockchain betting and gambling services allow transactions with cryptocurrencies, which widens the audience and helps to get rid of third-party intermediaries like banks or payment services.

Anonymity

It is an ordinary scenario when you have to fill in a number of documents in order to be able to make bets or play in an online casino.

Blockchain technology allows keeping your information private so that the operators cannot know who is playing via their platforms.

On one hand, it protects private data from getting to third parties. On the other hand, it eliminates the possibility of regulating such type of activity, which might cause worries.

Reduced House Edge Costs

House edge is a percentage of bets that the casino leaves to itself in order to pay salaries and other maintenance expenses. If there is no need for these payments, the casino can take less money, which will increase the prize pool, allowing users to win more.

Audience Expansion

People related to the industry believe that blockchain will help make gambling more socially acceptable and, as a result, attract more users to blockchain-based betting platforms and casinos.

This is the effect of the benefits we mentioned above: transparency, security, cryptocurrency availability, and others.

Blockchain in Gambling: Use Cases

Blockchain technology has found various applications in the gambling industry. These use cases bring transparency, security, and fairness to an industry often plagued by concerns about trust and integrity.

Here are some notable use cases of blockchain in the gambling industry:

Provably Fair Gaming

One major way blockchain benefits gambling is through provably fair gaming. In other words, due to blockchain, casinos and gaming platforms can demonstrate the fairness of their games.

Each bet, shuffle, and outcome is recorded on the blockchain, allowing players to confirm the legitimacy of results.

Secure and Transparent Transactions

Blockchain makes all financial transactions, like deposits and withdrawals, safe and transparent. Users can follow their funds on the blockchain, reducing the risk of fraud and keeping a clear record of financial activities.

Smart Contracts

Smart contracts are crucial for automating gambling processes as they enforce the rules and conditions of betting and games without extra control. This results in instant and error-free payouts, excludes the need for intermediaries and guarantees a fair gaming experience.

Decentralized Betting Platforms

Blockchain’s decentralization removes the need for middlemen in betting. Peer-to-peer betting platforms using blockchain allow users to create and join bets directly, making the process transparent and less susceptible to central authority manipulation.

Sports Betting Verification

In sports betting, blockchain technology is used to confirm the legitimacy of bets and their results. Users can follow the betting history and ensure that the odds are fairly determined, lowering the risk of disputes and fraud.

Online Casinos

Online casinos are using blockchain technology to offer a range of games, from slots to table games. These platforms use blockchain to create transparent and tamper-proof records of all gaming activities, guaranteeing players’ trust in the game’s integrity.

Blockchain-Based Lotteries

Lotteries have also adopted blockchain to establish transparent and fair systems. Blockchain ensures that lottery results are publicly available and verifiable, preventing any manipulation and instilling confidence in players that the lottery is fair.

Gaming NFTs

With blockchain, gamers can get unique in-game assets and digital items as NFTs. These assets can be traded, bought, and sold on blockchain-based marketplaces to create new monetization opportunities for players and game developers.

Cross-Border Gambling

Blockchain’s borderless nature promotes global access to gambling platforms. Players from different parts of the world can take part in gambling events without the trouble of currency conversion or regional restrictions.

Conclusion

Blockchain solves the trust issues that cause difficulties to users who are already involved in gambling and prevents new users from getting involved.

This opens great opportunities to businesses and offers even better perspectives to the industry that is already one of the most lucrative.