Cryptocurrencies are starting to grow again after Bitcoin quickly jumped in price. This provided a whole new wave of cryptocurrency services, and casinos and cryptocurrency gambling are not exceptions.
Pretty much from the beginning of 2017, when cryptocurrencies started to form quite a following, people started using them for gambling activities online as it was providing much faster transaction options and withdrawals.
But what exactly pushes these people towards using cryptocurrencies instead of regular cash when gambling online? Why is cryptocurrency gambling their “go-to place”?
The Anonymity of Cryptocurrencies
Just to be clear, the topic is not about gambling with Bitcoin, it’s about why players prefer to deposit through cryptocurrencies rather than use them as a currency to gamble. But these topics are both intertwined.
The very first reason that comes to mind is, of course, the anonymity of cryptocurrencies. And the P2P transaction system.
Everybody likes a bit of privacy for their financial life, but a hobby like gambling is pretty hard to hide right? So why are these people resorting to the Blockchain technology?
It all comes down to banks and the way they track our transactions. The banks record pretty much any payment you make in their data storage. Later, it could theoretically be used either against you or in your favour during a loan application or any other monetary support.
Bank Credit Score
As we all know, banks have a very strict credit score system. If you default on a previous loan or if you are late for the payment, your score decreases which makes you less eligible for a loan in the future. Apparently, another way of damaging credit score is by borrowing money to transfer it to gambling platforms through the bank.
Although gambling can be just a simple hobby for a person, banks do not always perceive it that way. Therefore, gamblers can find themselves struggling to get mortgage and business loans in the future simply due to the damage done to their credit score from gambling activities.
Third Party Payments
Many have already resorted to third-party payment methods such as Skrill or Neteller, but some banks are also considering these channels as untrustworthy. It may be less damaging for the credit score but it still has some ramifications.
To look at it from the bank’s point of view. If a user’s transaction was not for suspicious reasons, then they wouldn’t have bothered with a third party aggregator in the first place.
Benefits of Cryptocurrencies
Due to the increased interest in Institutional cryptocurrency trading, even banks have started to adopt the blockchain technology. Therefore, depositing money to a cryptocurrency exchange should not produce any type of suspicion.
For example, users prefer to transfer their funds to Binance, after which they convert to cryptocurrencies and then simply direct those cryptos from their Binance wallet to the online gambling platform. The only thing the Bank is aware of is that you deposited in a trustworthy financial exchange company. Accordingly, nothing is considered suspicious.
Transaction Speeds in Cryptocurrency Gambling
In most cases, third-party payment methods, Bank transactions, and even cryptocurrencies transfers come with fees. These fees rely on how long it takes to process the transaction, therefore they mostly vary.
With PayPal it’s 3.5%, Skrill is about 2% and with banks, it can go as high as 5%. With cryptocurrencies, however, most of the fees are either non-existent or inconsequential. The largest number most gamblers find is 1%.
This is due to the transaction speed of the Blockchain.
The Bottom Line
Overall it is quite clear why gamblers prefer to fuel their hobbies through cryptocurrency payments. They get much more anonymity and privacy in their transaction history, which prevents any collateral credit score damage.
They save time and money through the Blockchains fast transaction systems and low fees and if the cryptocurrency gambling goes south, they’re left with a currency that can potentially double in price overnight.