Over the past couple of years, blockchain technology and cryptocurrencies have crept up from the shadowy basements of computer geeks and nerds and is slowly finding its way into mainstream acceptance. Nowadays, it’s hard to engage in online financial transactions without the likes of Bitcoin, Ripple, Ehtereum, and Lite coin coming up. And Online Poker is no exception. Many poker and sports gambling sites are now, in fact, accepting cryptocurrency payments as deposits. According to Beastsofpoker.com, over $2 million worth of Bitcoin is wagered each our at online poker sites and casinos.
But despite this, most people still have no clue about what goes on behind the working of cryptocurrencies. Questions are often asked on what they are exactly. What makes Bitcoin and cryptocurrencies special? And most importantly, what kind of impact does Bitcoin have on online poker?
What are Cryptocurrencies?
To break it down, cryptocurrencies are digital currencies secured by cryptography that you can use to buy services and goods online. However, unlike other online transactions, these currencies use a more secure online ledger, thus limiting fraud and identity theft as much as possible. In fact, each transaction is recorded and globally recognized, which makes it almost impossible to hack or forge.
People also argue that because the decentralized computer networks built on blockchain are behind the transfers, governments can’t seize or freeze your deposits. On top of that, unlike the traditional banks, most of these cryptocurrency exchanges don’t charge transaction fees.
With all these benefits, you might be wondering why there isn’t a surge of more cryptocurrencies out there. Well, on the contrary, there are presently as many as 1,000 virtual currencies operating all over the world. However, being the industry leader, Bitcoin is the most popular. In the last two years alone, its value has grown by over 1,000%. It is also the most readily accepted in online poker among various websites. In fact, the majority of millionaires are already investing in crypto.
Bitcoin and Poker
The acceptance of Bitcoin to the online poker community can be traced back to the Black Friday in Poker, an event that occurred in 2011 when the United States Department of Justice indicted the three major figureheads in online poker in the country. Big sites were closed up, and soon after, major payment processors like Netteler started leaving the online gambling realm. Likewise, banks started rejecting deposits, making it impossible for players to place deposits and receive payments.
It was then that a group of poker professionals came up with the idea to look for an alternative – a fluid financial tool that would allow direct connection between poker sites and players. Bitcoin was the most viable option. And so, the SealsWithClubs (SWC) poker site was formed – an Us-friendly Online Poker room that cut out the middlemen like banks and accepted Bitcoin only.
Up until then, Bitcoin was still largely a foreign concept and was notoriously difficult to acquire. People would either mine it or perform cash for Bitcoin swaps. Despite its relatively small size, SWC still made its mark in the online poker playfield, even emerging top ten best US-friendly poker sites at the time.
Its existence alone showcased the possibilities of Bitcoin peer to peer transactions and set the avenue for other online gambling sites. Eventually, other online poker sites, including sportsbooks and online casinos, jumped into the mix, taking advantage of Bitcoin’s smooth mode of payments.
So Why do Online Poker Casinos Love Bitcoin so Much?
As we’ve seen, Bitcoin is not the only cryptocurrency in the game out there. Others like Ethereum, Litecoin, and Bitcoin Cash are equally as legitimate and accepted in online gambling sites. However, Bitcoin still has a significant lead over the others in terms of popularity.
So why do online poker sites and casinos love Bitcoin so much? Well, other than the decentralization and security factor, there are a few other reasons.
- Nobody singularly controls Bitcoin
Perhaps the main reason why online gambling sites gravitate towards Bitcoin is that there are almost no restrictions made on transactions. You see, following the events of Black Friday, the government banned any gambling businesses from operating in states where online gambling was illegal. As a result, banks complied with this law, rejecting several transactions relating to offshore gambling. However, while the government might influence banks and other financial institutions, they cannot exert the same on Bitcoin. Overall, with Bitcoin, customers get to make their deposits and withdrawals without interference.
- Minimal fees
The other good thing about Bitcoin is that it doesn’t come with any charges on deposits and withdrawals like banks. This saves money for both the players and the poker site, which was originally responsible for the withdrawal charges. With Bitcoin, gamblers instead only pay a significantly smaller fee to the miners when making withdrawals or deposits.
- Bitcoin is trending
There’s no denying now that cryptocurrencies are trending these days. They have sparked people worldwide, and now everybody wants to try this new currency in town. In a bid to attract these curious crowds, any newly developed online poker site or casino tries to capitalize on the trend, launching with a cryptocurrency provision.
From the look of things, Bitcoin is clearly not going anywhere. For as long as the unregulated markets are present, there will be a place for decentralized currency in the online poker gambling realm. However, it is still less popular in the states where online gambling is legalized. There’s simply no need for it since most people in these countries can gamble already freely through other financial instruments.
It is also noteworthy that it is important to take care when gambling with unlicensed sites in states that have legalized gambling. Although Bitcoin and other cryptocurrencies may create an avenue for it, such states have regulations to protect their legal poker market and are quite vigilant in taking action against illegal gambling activities.