Security, transparency, traceability: Cryptocurrency in igaming
Crypto gambling currently has a market size of around $250 million and is growing exponentially as cryptocurrency is being adopted as a legitimate, safe payment method for gambling and beyond. Crypto wagers made up around 8.5% of sports betting GGR in 2021, and the total number of crypto bets increased by over 20% between 2022 and 2023.
“Security and transparency are incredibly important in the context of banking and regulatory compliance generally,” says Glazaite. “Within the context of crypto, blockchain is seen by many as an incorruptible ledger which vastly improves transparency.”
Cryptocurrency is built using blockchain technology. The blockchain is decentralised, which increases transactional security and mitigates risks of fraud or interception. Cryptocurrencies are arguably one of the safest ways to make online casino deposits, despite being the least traditional and most ‘mysterious’ casino payment method.
“I think it’s fair to say that broadly speaking, cryptocurrencies are still quite a niche concept in the igaming industry. While the majority of the market still only operates with more traditional currencies, for those interested in crypto, there remains an opportunity to get ahead early and ride the wave.
“There is a way to harness blockchain, with currencies that transcend borders, but it’s just not happening with any scale at this point.”
The growth of crypto gambling
The first crypto casino was launched by the pseudonymous Satoshi Nakamoto in 2009, in tandem with the launch of Bitcoin. But despite being a provably secure payment method and experiencing unprecedented growth in popularity, cryptocurrency deposits remain relatively unleveraged, prohibited by state regulators, and available only at offshore casinos that are regulated by a remote-gaming jurisdiction.
Fiat currency wagers still make up the majority share of worldwide gambling revenues. However, the landscape of online gambling payments is ever-changing, and more cryptocurrencies are slowly but surely beginning to increase in popularity.
“Crypto casinos are actually very similar to all other online casinos; the main difference, of course, is the currency with which they trade”, says Glazaite. “They face exactly the same challenges as those seen across the market when it comes to things like acquisition, retention, and product offerings.”
“I don’t think it’s likely they will be as common as traditional casinos any time soon, as the dollar especially is much more recognised when it comes to cross-border transactions,” Glazaite continues. “However, crypto is important when it comes to segmentation.”
Utilising crypto for online gambling
Discussing the obstacles that crypto operators face, Glazaite describes how the pool of potential players is much smaller than at traditional retail or online casinos.
“The biggest challenges are similar to those you see across the online casino industry, but a more specific challenge would be how you target the specific type of audience that may wish to play with a crypto casino. Even in countries that have the highest share of crypto penetration, the number is around 25%.”
Meanwhile, operators who serve multiple jurisdictions often encounter issues when attempting to implement cryptocurrency payments to their sites.
“While crypto may be a large market when combining the geographies, it’s still not considered mainstream in any one geographical territory, so operators will have to work out how to split their marketing costs when trying to grow crypto casinos across the different territories.”
According to Glazaite, one key to a successful crypto casino is to offer as many different currencies as possible.
“Many will already use Bitcoin and Ethereum. You have to expand on that while also ensuring that everything from the crypto wallet to the solutions that enable players to wager, deposit, and withdraw, are all second to none.” In 2023, around 74% of crypto gambling transactions were facilitated with Bitcoin, with Ethereum taking second place.
Glazaite also describes how crypto casinos are being primed to provide a newer, more innovative online gambling experience to players around the globe. “Crypto casinos have become the latest innovation because they are set up well to provide a new kind of experience, and I think an important part of that is NFTs; this is where we are likely to see more innovation.”
Using NFTs at crypto casinos
Most internet users will remember the NFT boom of 2021. After such a huge spike in interest, NFTs appeared to have lost momentum. However, they have been quietly making waves in the online gambling world, with some crypto casinos beginning to integrate them into their igaming platforms.
NFTs present distinct advantages when implemented at online casinos. For starters, they aren’t geographically restricted. They are not a fiat currency like a dollar or euro, or even an identical currency like Bitcoin or Ethereum, but are a one-of-a-kind, blockchain-based virtual asset.
NFTs are programmable and can retain game information. This provides the casino with even further transparency over the fairness of its games, potentially more so than an external auditor like eCOGRA can provide with its certificate of compliance and list of Return to Player (RTP) percentages. While RTPs are theoretical, NFTs can provide authentic evidence of the way a game plays out.
Another benefit of NFTs is that they are interoperable, meaning players can use them across multiple different games and platforms. This not only improves the overall user experience through seamless multichannel integration, but it also increases the investment potential of an NFT.
“NFTs are set to become a mainstay of the crypto industry, and this is very important for us at iGP,” Glazaite explains. “We are set to announce a partnership with a new crypto casino, where we will be launching an NFT marketplace as part of the casino experience. We are very excited about the opportunities NFTs will bring and they will be key to the growth of crypto across the next few years.”
iGP’s proprietary crypto software
iGP recently launched its own proprietary crypto casino software later this year. The customisable turnkey crypto casino solution is embedded with a multi-currency crypto wallet, allowing users to choose between crypto and fiat currencies.
“Our crypto casino solution will allow operators to start their own crypto casino in just a few weeks. Our solution is built with a focus on security and stability, ensuring that players have a safe and enjoyable gaming experience”, says Glazaite.
“Transactions are secure and instant, because the solution integrates with a crypto payments processing platform and wallet management system that comes with built-in analytics and risk management tools. Much of the work has already been done for the operator, so integration will be a smooth and simple process.
“The iGP platform features deep reporting capabilities which have been carried over, and we’ve also developed a crypto wallet that can allow for multiple currencies,” Glazaite continues. “The solution is customisable; it comes with several templates, with three different front ends that are available for operators. We have also simplified registration tools, allowing our partners to link wallets and make it easy for the user to make deposits.”
This idea of customisation is a core part of iGP’s personal approach to crypto casino gaming. “We’re looking to work with experienced, ambitious operators at both tier one and tier two levels. Rather than present them with a crypto casino without any questions being asked, we want to keep an open line of communication with partners and deliver the solution that works perfectly for what they are trying to do. Once we have those things in place, marketing and strategy will be key operational success, especially in a niche market like crypto.”
iGP launched its new crypto casino solution in late September and Glazaite hints that there will be plenty more announcements to come.
“We think there is a gap in the market to upgrade the technology people are using, provide better user experiences, and give operators more control and power to achieve their ambitions. The iGP crypto solution ties in with that strategy, and we cannot wait to unveil the product and see how it performs in the coming months.”
