Are Crypto Casinos Real? What You Need To Know

Salomon Kisters

Feb 27, 2023

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Crypto casinos are just as real as Bitcoin and cryptocurrency itself. Many of these are available on the internet. They come equipped with the feature of using cryptocurrency as the exchange medium for gambling.

These are just as lucrative and have various traditional casino games from which you can choose to try your luck!

While online casino games may sound different from traditional casino games, there is little difference in the mechanism of the games themselves. The only distinction is how the money flows through the system, and that money is cryptocurrency.

If you still have doubts about them, hold your horses and continue reading as we try to explain what exactly they are.

The Rise of Crypto Casinos

With the advent of digital currency, many of our social activities involving finances have also shifted to the internet. Online casinos were first introduced in the mid-1990s and slowly gained acceptance among beginners and seasoned players alike.

Following the rapid increase in the popularity of cryptocurrencies, many people started replacing traditional currencies with crypto in online gambling due to their increased potential for profitability. Years following this success, more and more people began to adopt it as the standard mode for trading.

Cryptocurrencies started to replace traditional currency in many places, one of which happens to be the gambling economy.

In the year 2014, the first casino platform came into existence, called Bitcasino, and it was the first online casino that incorporated a cryptocurrency as a payment method. Since then, many online casinos have appeared on the scene as cryptocurrency continues to gain momentum.

Types of Crypto Casinos

There are two main subtypes of crypto casinos, offering on-chain and off-chain gambling experiences.

Off-Chain Casinos

These are not present on the blockchain network and, thus, are more closely monitored and regulated. They may run on a centralized system and users will have to register in that case. Since off-chain casinos track players, they can control their activity and treat them according to the rules and regulations of their country.

Therefore, they work like traditional casinos, but they may accept payment in the form of cryptocurrency.

On-Chain Casinos

As the name suggests, these casinos run on blockchain networks and are far more decentralized. Just like the cryptocurrency itself, these casinos cannot be regulated by a centralized authority. They function with the help of smart contracts, so they operate quite differently from traditional casinos.

Which is Better? On-Chain or Off-Chain Casinos

On-chain casinos appear to be more favorable for the common users, but it is entirely up to you to decide which option you want to go with. While, yes, off-chain casinos do accept crypto, it does not necessarily mean they are on a blockchain network. They convert your crypto balance into local currency and function a lot like traditional casinos. On-chain casinos, on the other hand, are real crypto casinos using cryptocurrency and processing payments using smart contracts.

On-chain casinos are more trustworthy because everything is transparent and embedded on a blockchain using smart contracts. Smart contracts are a unique feature of the blockchain network, as they execute an action only if certain predefined conditions are met. So there is less chance of you not getting your money because of fraudulent activity, which may be a more common occurrence in traditional or off-chain casinos.

Furthermore, the involvement of a third party always ends up with the users getting charged hefty fees or payment transfers. This is precisely what happens in off-chain or traditional casinos but not in on-chain casinos. Since the bet is placed using a smart contract, there is no dependence on a third party so no one will be paid any extra fee.

It also means that the bettors must make every payment before the bet is placed, thus, further ensuring the money is already in the system. There will be no dependence on a banking or traditional financial system, which often comes with the risk of payment failure.

Are Crypto Casinos Legal?

One of the most Googled aspects of cryptocurrency is its legitimate status within the financial system. Digital currency may still lie in the gray area for most ordinary folks as so many countries have yet to integrate cryptocurrency into their larger financial system and regulate it within their legal framework.

But generally speaking, as a rule of thumb, most crypto apps follow traditional gambling rules. So if a country permits the use of cryptocurrency, and gambling is also allowed, you can use crypto casinos with ease. However, most places require these platforms to be registered to function.

Regulation in the US

For US Citizens, crypto casinos can only function if the casino is verified. There are only a few states which do not monitor any form of online gambling, like Pennsylvania, but most states independently exercise gambling rules and regulations.

Therefore, most gambling platforms must be registered in the directory to function at all. It is also advised that individual players use a regulated or licensed online casino to ensure the safety of their person and their money, especially those players who are underage (below 18) and should not be exposed to gambling.

Conclusion

Online crypto casinos are a faster, much more secure way of placing bets and risking your money in cryptocurrency. Like cryptocurrencies, they can run on a blockchain network and are much more secure, transparent and dependable than regular casinos.

However, a word of caution here is in order: the online gambling scene is rife with scams and one should beware of phishing and other fraudulent attempts by hackers.

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