An informative guide to the pros and cons of using Cryptocurrencies for online casino transactions. All the advantages and disadvantages
Last Updated on February 19, 2023 by Dave Hall
Over the past five years, we have seen a growing appeal for cryptocurrencies. Unlike in 2009, when everyone thought that cryptocurrencies are just a fad, that is not the case today.
Cryptocurrencies have proven to be an alternate currency to fiat currencies. In fact, a majority of eCommerce and retail businesses have or are already in the process of integrating cryptocurrencies as payment methods.
When Did Cryptocurrency Come into Existence?
Most people think that cryptocurrencies started with a white paper published on October 8th, 2008. Well, they are wrong. Cryptocurrencies go all the way back to 1983. David Chaum introduced untraceable electronic money, namely C85 and C88.
He proposed the creation of cryptocurrencies after considering that credit cards and paper cash are vulnerable to fraud. For example, someone can lose his or her credit card on a bus, train, or road. If another person picks the credit card, they can use it to buy stuff. This is the same with paper cash.
In his report, he proposed that electronic currency should be done in cooperation with banks. He even came up with a formula for fulfilling transactions between two parties with the bank as a middleman.
Two decades later, a computer engineer named We Dai wrote a paper discussing the idea of ecash or “B-money,” while Nick Szabo, a blockchain pioneer, developed Bit Gold. Sadly, neither of these projects took off until 2008.
The Rise of Cryptocurrencies
In 2008 specifically, October 8th, Satoshi Nakamoto published the now-famous white paper on the functionality of a Bitcoin blockchain network. In the paper, Satoshi proposed a peer to peer version of electronic cash that would enable users to make payments directly without using a financial system.
Part of the solution was to use digital signatures to prevent double spending. The proposed ecash would be part of a peer to peer network. The network would timestamp transactions by hashing them into a chain of hash-based proof of work.
Basically, the decentralized blockchain would keep a record of all transactions. After publishing the white paper, the first block of Bitcoin was mined on January 3rd, 2009. This effectively started the mining and use of cryptocurrencies and blockchain technology.
That first block is today referred to as the Genesis Block.
How Many Cryptocurrencies Are in Existence?
Let’s face it. Cryptocurrencies have taken the world by storm since the introduction of the first cryptocurrency exchange in 2010. Great innovators have developed cryptos to reduce the dependence on fiat currencies and offer users more choices.
There was a time when you could count the number of cryptocurrencies. But today, you have to compare different exchanges to find out the actual number of cryptocurrencies in existence.
Lucky for you, we researched and discovered that there are 6,432 cryptocurrencies with a market cap of $354 billion.
Which Are the Most Popular Cryptocurrencies?
The most popular cryptocurrency is Bitcoin, with a market share of 60.1%. At the time of writing, Bitcoin had a market cap of $213 billion, with one Bitcoin retailing at $11,547. The number of Bitcoin in circulation is 18,458,750 BTC.
The second most popular cryptocurrency is Ethereum, with a market cap of $43 billion. At the time of writing, Ethereum was retailing at $383, and the number in circulation is 112,152, 231 ETH.
After Ethereum, you have Ripple (XRP) with a $12 billion market cap and a retail price of $0.281.
Here is the list of the ten popular cryptocurrencies:
How Does Cryptocurrency Work?
Since the beginning of time, people have traded. They traded food, gold, and precious stones like diamonds. Today, people pay for goods and services using fiat currency, such as cash or credit cards.
To facilitate transactions, you need to have a bank account. Not only that. You will incur transaction fees when you deposit and make withdrawals. You will also incur account maintenance fees and others.
In 2009, Satoshi Nakamoto created Bitcoin. A decentralized cryptocurrency that would allow parties to transact without a centralized authority. Basically, users can send cryptos directly to digital wallets worldwide.
How you may ask. Cryptocurrencies are a digital form of money that does not rely on a central authority like banks and governments. Instead, they rely on the blockchain, a peer to peer network that keeps track of all cryptos even those held in digital wallets.
When setting up your digital wallet, you are immediately assigned two encryption keys – public and private. Without going into the science, these keys aid in verifying the accuracy of the transactions.
At the center of the blockchain is a ledger. This is where all transactions are made public. Due to this, the chances of double spending are minimal, and everyone has to play fair. Nobody can change the entries, and no one owns the ledger.
It’s decentralized, free from the interference of outside parties.
Pros and Cons of Using Cryptocurrencies
After a decade of existence, we can conclude that cryptocurrencies have unlimited potential. One of those is buying goods and services from eCommerce sites and other online retailers. Another way of using cryptocurrencies online is in the world of online casinos.
Cryptocurrency casinos worldwide are now accepting Bitcoin and other cryptocurrencies. In fact, users can deposit cryptos from their digital wallets to the casino’s digital wallet.
Once users deposit cryptocurrencies with online casinos, they can place bets and play virtual casino games. Besides accepting cryptos, Cryptocurrency casinos are also paying out in digital currency.
Here are more pros and cons of using cryptocurrencies online.
Advantages of using Cryptocurrency
Cryptocurrencies Are Discrete
Cryptocurrency purchases are discrete thanks to the blockchain network and digital wallet. This is unlike fiat currencies such as credit cards, where users’ purchases are usually associated with their identity.
Basically, cryptocurrency transactions cannot be easily traced back to the users. This is thanks to the crypto address generated when creating a digital wallet. Yes, you can trace the transactions made by the digital address, but you cannot link it to a person’s identity.
No Banking Fees
When you withdraw cash from an ATM or pay for goods and services using your credit card, you incur banking fees. Also called maker and taker fees, these fees are common with traditional bank transactions and fiat currencies.
With Bitcoin and other cryptocurrencies, users do not incur any banking fees. They can send money and make deposits to digital wallets worldwide without paying any deposit and withdrawal fees. They do not pay account maintenance fees, minimum balance fees, and overdraft charges, among many others.
Ease of Accessibility
With fiat currencies, you need a bank account and the traditional financial network. But with Bitcoin and other cryptocurrencies, all you need is your digital wallet and the receiver’s address. With these, you can send cryptocurrencies worldwide.
In fact, you can do so at any time of the day.
Low Transaction Fees
Traditional bank wire transfers and even international purchases involve fees and exchange costs. This is not so with cryptocurrencies like Bitcoin. Since they’re decentralized, there is no third-party and government involvement.
Due to this, the transaction fees have been very low. Besides low transaction fees, there are no authorization requirements common with bank transactions.
With cryptocurrencies, users have more autonomy compared with fiat currencies. Users control how they spend their money without dealing with banks or governments. Besides user autonomy, illegitimate chargeback requests are minimal.
This is unlike payment systems that allow illegitimate chargebacks from users. When this happens, the business experiences a loss of revenue and goods.
With cryptos, users cannot make chargeback requests due to the blockchain network.
Fast and Secure Transactions
It takes three business days for banks and other payment networks to process payments. This affects business performance because they have already shipped the goods or rendered the service.
With cryptocurrency transactions, they are fast and secure. You can send cryptos from your home in the US, and in a matter of minutes, the receiver in Europe, or Australia will receive the digital currency.
The same can be said for Cryptocurrency online casino transactions. They offer the players that use crypto the fastest casino payouts in the industry. Withdrawals are often paid out in minutes if playing at a fast payout casino.
You don’t have to wait for three days for your transaction to go through.
Disadvantages of using Cryptocurrency
Lack of Widespread Appeal
Research shows that only 19% of the world’s population have bought some cryptocurrency as of 2019. That means 81% have never bought cryptocurrencies. Not only that. More than 10% of people have yet to understand what cryptocurrencies are entirely.
What this shows is that cryptocurrencies are still considered a niche. As a business planning to integrate cryptocurrencies as a payment option, make sure they make a fraction of your incoming revenue.
Most countries around the world accept cryptocurrencies as an alternate form of currency. The problem is, some have banned the use of cryptos to buy goods and services. This is bothersome, especially when it comes to implementation.
One such country is Russia. On July 22, 2020, Russian lawmakers passed a bill giving cryptocurrencies legal status. But they banned cryptos as a means of payment. Reasons for banning the cryptos include the use in financing terrorism and in money laundering.
While cryptography is heavily used in the crypto market to protect users, evidence shows that they are vulnerable to attacks. One of the most popular attacks is cryptojacking. This is a method where hackers use old malware tricks to mine cryptocurrency using someone else’s computer.
Hackers can do this by tricking the victim into clicking a malicious link. This link is usually sent as a pdf document, picture, or normal hyperlink. When the user clicks on the link, the malicious code executes and loads in the victim’s browser.
Every time the user browses the internet, the crypto mining code uses the computer’s CPU and GPU power to mine cryptos.
Conclusion – Are Cryptocurrencies Right for You?
Cryptocurrencies have a huge role to play, now, and the coming future. As more countries continue to embrace cryptos, more users will continue to adopt them. This means it will be easier to implement and accept cryptos as payment for goods and services.
Currently, cryptos such as Bitcoin are generally plagued by scams and fraud. This is due to the crypto’s decentralized nature. A good example is the Mt. Gox exchange hack, where thousands of Bitcoins were stolen.
Besides scams and fraud schemes, Bitcoin is now associated with the black market and criminal activity. It has become the de-facto crypto for transactions on the dark web. The good news is, cryptos have value, and thanks to the blockchain design, illegal chargebacks are non-existent.
Regarding whether cryptos are right for you. Well, only you can make that decision. What we recommend is reading the pros and cons discussed above. We hope that the pros and cons above act as a jumping-off point to help you adopt cryptocurrency use in buying goods and services as well as cryptocurrency casinos.
About the Author
Dave is a gambling enthusiast who boasts of two decades of experience. His writings not only unravel the intricacies of online casino games but also explore the psychology behind betting. Dave's commitment to responsible gambling shines through, making every wager a mindful choice for players seeking a thrilling yet balanced gaming experience.