Bitcoin Casinos

In August 2008, the domain bitcoin.com was born and it is still to this very day a phrase of biblical proportions. Fast forward nine years and the word ‘Bitcoin’ became synonymous with every kind of ‘get rich quick’ scheme to have come and gone in the decades before that.

Though this hit the headlines in a dramatic way. Almost a craze, promising and delivering big returns for any investor, though with equally volatile implications. It was all about timing and for those who paid attention, it was perfectly simple.

Trading bitcoin all of a sudden became ‘in-vogue’, it was the summer of 2017, a year on from the Brexit vote, though Twitter had found a new hashtag. Bitcoin became the anticipation sensation that had gripped the nation and was splitting opinion with almost as much controversy that the political arena had done a year previously.

As the price of Bitcoin surged with as much perpetuity as that summer’s temperatures across most of Europe, there was an almost indefinable clarity and simplicity about the way in which the increasingly popular cryptocurrency had taken off.

Like anything, timing was key. In 2008 when the highly probable pseudonym of Satoshi Nakamoto theorised the concept, via a research paper titled “Bitcoin: A peer to peer Electronic Cash System”, (based on a system for electronic transactions without relying on trust) ironically at the eruption of the global financial crisis, this had been met with derision more than cynicism. Banks and governments scoffed. How poetic.

Bitcoin in the Beginning

Following the release of what at the time was the much maligned paper, the infamous Nakatomo was said to have started to ‘mine’ bitcoins and as of January 2009, a network for Bitcoin was created as Nakatomo mined the ‘genesis block’ of Bitcoin (fitting), (block number zero), and this carried a reward (or preempted value) of 50 Bitcoins.

It was programmer Hal Finney who was one of the first Bitcoin loyalists having downloaded the software on the day that it was released and consequently received 10 Bitcoins from Nakatomo, in what was the world’s first ever Bitcoin transaction.

Initial estimations indicated that Nakatomo first mined one million Bitcoins before seemingly disappearing off the grid. It appeared that lead developer Gavin Andresen assumed control via the aptly named Bitcoin Foundation; the closest entity to what was hoped would be seen as a legitimate public face.

What is Blockchain in relation to Bitcoin?

This is something that many people confuse when talking about cryptocurrency and if you are going to be using Bitcoin, it is important that you understand what Blockchain is.

Essentially, Blockchain is the technology platform behind it and which enables Bitcoin to be in existence and function. What this technology does basically is keep a record.

A ‘block’ refers to a digital piece of information which is stored in a public database (the chain) and as such records transactions with as much as 1MB of memory being able to be stored safely and securely in one block.

Because it is designed specifically for digitised currency, with each one being decentralised it makes for a great way to ensure that a person’s individual data cannot be traced back to them, so that users can reap the benefits of both anonymity and security.

Blockchain, was actually first theorised and conceptualised in 1991 by two researchers; Stuart Haber and W. Scott Stornetta who wanted to create a system that meant document timestamps could not be altered or changed in any way.

However, it wasn’t until almost two decades later that Blockchain had its first actual real world application, highlighting the fact that sophisticated ideas can only progress if the technology is there in the first place.

Essentially for Nakamoto the Blockchain technology represented the perfect platform for Bitcoin to operate on, due to the security and anonymity as well as the overarching principles of the two technologies.

The way that Blockchain works in relation to Bitcoin, is that in the network of Bitcoin, the Blockchain is not only shared and maintained by a network of public users, but it is also mutually agreed on.

When a user joins the network, for example, starts using Bitcoin, their network connected device receives a copy of the Blockchain that is updated every time that a new block of transactions are added to it.

The most common mistake about Blockchain that people make, is that they think it is also a cryptocurrency, but all it basically is, is a sophisticated software that powers the ability for Bitcoin transactions to take place, safely, securely and above all, legally.

Bitcoin Wider Acceptance Amid Competition

It wasn’t until near the end of the global financial crisis that Bitcoin started to emerge as a potential payment option and it was 2011 when not for profit groups, such as Wiki Leaks started to accept the ‘crypto currency’ as recognised tender.

A year later, Bitcoin really started to gather momentum when several other enterprises such as WordPress began to accept the currency as a form of payment which considerably gave credence to the legitimacy of it as an authority.

By 2013, Bitcoin’s payment processor, Coinbase was understood to have been responsible for actioning over $1 million worth of Bitcoin transactions in a single month at a value of $22 per Bitcoin.

Following considerable interest and activity around the world, especially in the US, it prompted authorities to step in as considerations were made as to the legality of the currency and its implications for the effect that it would have on the economy and trade.

Due to the widespread presence and availability of the currency, it soon began to become the subject of questionable uses especially with it being decentralised.

Perhaps a landmark move occurred in November 2013 when the University of Nicosia announced that it would start accepting Bitcoin as a payment for tuition fees, labelling it “the gold of tomorrow” and as such, this marked a considerable victory for the virtual currency.

Gambling leads major Bitcoin breakthrough

In 2014, the floodgates opened and Bitcoin rode the crest of the wave as gambling companies led a tidal surge of companies who started to accept the currency as a form of payment and for the first time six years it seemed; Bitcoin was no longer treading water.

January of that year, Zynga revealed that it was going to start using Bitcoin as testing for purchasing in game features on seven of its games. And then, in the same month, The Downtown Las Vegas Casino Hotel as well as the Golden Gate Hotel and Casino entities in the gambling hotspot said that they would also start to accept the currency.

Jeffrey Green, an advisor for Zynga at the time cited: “The benefits would be to give the user another payment option. Give the user what he wants, so to speak,” he said to Coindesk.

“The challenge would be the volatility of bitcoins and what their worth might be when exchanged for dollars. Volume wouldn’t be very high, but there likely will be gamers out there looking for something novel to try,” he continued.

That summer, a further major breakthrough; stock exchange listed companies Dell and Newegg began accepting Bitcoin as an acceptance of their trading currency as a mark of reciprocation to a number of investment banks hedge funds, regulatory institutions and corporate clients across their operating regions.

Within the space of the next three months, IT giants , Microsoft jumped on the bandwagon as they pitted their support towards the acceptance of Bitcoin by way of the hugely popular Xbox games, with Windows software being pitted into a position to compete considerably.

There are plenty of reasons to believe that Bitcoin will have a major part to play in the online casino industry for years to come. This is because, every online casino recognises that it is in their interests to use the latest technology and through their own research, they can join the dots between how their target customers are behaving online and what they favour.

Due to the anonymity advantages that are associated with Bitcoin and the ability to transact securely without leaving a correlation with bank account details, this is a process that more and more gamblers will be able to relate with.

Banking with Bitcoin at an Online Casino

This banking method is still a relatively new initiative for online casinos who are just starting to catch up with the Bitcoin and cryptocurrency craze.

However, the fact is that the currency now is an in demand form of payment after many took advantage of the opportunity to trade Bitcoin when it started to hit a peak in popularity. Also, it is no coincidence that some of the largest holders of Bitcoin are online gamblers who identified the nature of amassing such an amount quickly and easy to be similar to that of playing online slots or games.

There are some online casinos which are dedicated solely to Bitcoin and while these are considerably new, they have prompted some of the more traditional online casinos to start offering this.

In order to make a deposit with Bitcoin, you obviously need to own some of it and if you don’t already, it means that you would need to create a Bitcoin wallet and as a result, there are numerous websites where you can find one in order to start storing Bitcoin.

These include blockchain.info which give you the ability to open a wallet for you to then start buying Bitcoin. Your online wallet, will be individually numbered, which means that this will be completely unique to you.

There are a variety of websites in the form of online exchanges where you can buy Bitcoin, such as coinbase or kraken. Once you are satisfied with the amount of Bitcoin that you own, you can simply find the online gambling website that you wish to use, though make sure that they accept Bitcoin, click on Bitcoin as a deposit option and you will be prompted with a number of steps.

Every online gambling website’s deposit process is different; some may have more steps and others may be more streamlined, though essentially, if you follow the instructions that prompt you, the rest should be straightforward.

Advantages Of Bitcoin Banking With Online Casinos

Bitcoin is one of the fastest ways to make a deposit to an online gambling site, due to the fact that transactions are not rerouted through any central banking system.

Furthermore, because your Bitcoin wallet is identifiable by a unique number, it means that it does not have any kind of personal details attached to it ensuring that transactions are safe, secure and above all anonymous. Also, online casinos do not charge to make transactions with Bitcoin though this is not always the case with other online banking methods which online gambling sites cater for.

Transactions with Bitcoin are also done almost instantly, as opposed to other banking methods and payment processors, which can take up to five days for deposits and withdrawals to go through, which makes for a more pleasant online gambling experience for the player.

Also, there are still a number of countries where online gambling is not yet legalised, which means even if players in those regions are gaining access illegally, the Bitcoin deposit and withdrawal method provides them with a secure and anonymous way of being able to play. Some national banks for example prohibit any kind of transactions which are still considered illegal.

Disadvantages Bitcoin Banking With Online Casinos

While there may seem to be, on the face of it a number of attractive reasons for using Bitcoin as a payment processor at online casinos, these need to be weighed up against potential negatives.

If you are contemplating using Bitcoin, you should at all costs make sure that you properly understand the currency, mechanics and the process completely before making any kind of decision.

One big drawback of using the currency, is that it is arguably one of the most volatile in existence and can quickly lose its value. This means the rate that you bought if for can quickly increase which will go against you considerably.

Imagine buying Bitcoin for $300 to then want to withdraw a day later to find that it has gone up to $500 – that leaves you in a deficit position. However, it can work in your favour if the value decreases. It is for this reason why you need to have a comprehensive understanding of the currency and realise how likely it is to change in value while you are using it.

In line with popular demand, there is also a considerable rise in the number of online poker sites who are using Bitcoin. While this could be seen as positive on the one hand, it does open up possibilities for corruption and collusion, with potential identities at risk, which means that they may not be as anonymous as first thought or guaranteed.

Following on from this, there is an argument to suggest that the anonymity that Bitcoin promised may not be as straightforward. This is because there is an implication that the currency can actually be tracked via the blockchain technology back to the original purchase point, which as a result would consequently track back to the Bitcoin wallet owner’s bank account information and personal details.

There are many different nuances to the process, however, like with anything, it is always best to proceed with caution and at least be aware of the risks before deciding to make Bitcoin your preferred banking method when you sign up to an online casino site.

Other payment methods that Online Casinos offer

Should you not be comfortable using Bitcoin as your preferred payment option, you don’t need to worry because there are many other ways to enjoy your online casino experience.

• Debit Card: Every online casino will offer this highly popular payment method with most major debit cards catered for, including Visa, Maestro and MasterCard.
• Payment Gateways: If you aren’t comfortable with the online casino having your bank details, you can use one of the online payment gateways that are available which are starting to rise in popularity. These include PayPal, Skrill or Neteller, which are easy to use and basically act as a middleman, whereby you deposit into these from your account and it acts as an extra layer of transactional security.
• Paysafecard: This is arguably one of the most secure ways of depositing and essentially allows you to purchase an electronic card for the value that you wish to spend, which gives you a unique code. When you find an online casino that you wish to use, simply enter this code at checkout and your funds will be credited to your gaming account.

These are just a few of the alternative payment methods that are offered by online casinos as an alternative to Bitcoin, so if you are unsure about using this cryptocurrency, then don’t worry – you do have other options which have been used for a long time!

Security

While Bitcoin is effectively one of the most secure methods of banking, not just via online casinos, but on the internet in general, online casinos which offer Bitcoin as a form of transacting will also have their own security procedures in place.

We only partner with online casinos which are secure and a good way of being able to distinguish this is whether they are licensed and regulated by a relevant body such as the UK Gambling Commission or GGC (Gibraltar Gambling Commission).

What this means is that if they are, then they pass the stringent conditions. These include the fact that for any financial transactions, there has to be SSL in place which refers to highly encrypted technology to secure any movement of data online.

Furthermore, as part of their sign up process, most online casinos now have a KYC process in place (Know Your Customer), which enables the sites to prevent any kind of fraudulent activity and ensure that security and privacy remains the highest priority.

FAQs

With Bitcoin still being a relatively new form of currency, especially its connection to the world of online casino, there may still be quite a few questions that are unanswered, so we have endeavoured to anticipate some of the most likely and provide detailed answers below.