What is Cryptocurrency?
The most basic definition of cryptocurrency is that it is a sort of digital currency that is produced via the use of computer code. Despite the fact that it is a sort of currency, there is no actual money in the sense that we are accustomed to with regular coins and dollars; instead of being backed by the trust provided to the people by a government's financial system, the value of bitcoin would be backed by the trust put into it by the people using it. That being said, cryptocurrencies were idealised to be a means of purchasing goods and services once the concept had well and truly entered the mainstream; whether or not this is true today will be discussed later in the article.
A Brief History of Cryptocurrency
It goes without saying that, in order to have a decent debate about cryptocurrencies, we must first have a reasonably thorough understanding of how it, or rather, Bitcoin (which was the first cryptocurrency) - came to be in the first place.
Following the global financial crisis of 2008, the concept of Bitcoin was explained in a white paper written by an anonymous person known only as "Satoshi Nakamoto" (the real identity of the author is still unknown). As detailed in the preceding event, this white paper envisaged a decentralised currency that was not susceptible to the whims of governments or huge financial institutions, which may destabilise the value of the currency as a result of their actions. The Bitcoin whitepaper and source code would be released later that year, and Satoshi Nakamoto would officially launch the Bitcoin network in 2009 by mining the first block of the network. The rest, as they say, is history.
How Cryptocurrencies Work
So we have mentioned the words "mining" and "block" in the previous section. These two concepts are fundamental components of cryptocurrencies and are a great place to start in order to understand the nature of these digital currencies.
In general, cryptocurrency operates like so: every transaction between users is recorded in a digital ledger that is called the blockchain. A copy of this blockchain is then sent out and stored on every "node" (typically a computer device) that is part of that blockchain. The reason for this redundancy is that it allows all of the nodes on the blockchain to verify new transactions and new blocks that enter the ledger, which forms the "decentralized" tenet of cryptocurrency and helps identify and remove any attempts at making fraudulent transactions. (Of course, that is not to say that such transactions are impossible to pull off on the blockchain, but that is beyond the scope of this guide.)
Cryptocurrency Mining and Trading
The creation of coins is the foundation of all cryptocurrency systems, including Bitcoin, Ethereum, Litecoin, Dogecoin, and their derivatives, as well as all other alternatives. Coins are formed by nodes agreeing to handle a portion of the blockchain traffic that is responsible for managing the coins themselves. Mining is the term used to describe the process of producing these currency units.
Simply explained, cryptocurrency mining is the process of assigning computers to the task of resolving complicated mathematical problems that aid in the verification of the integrity of transactions on a distributed ledger. The first node to successfully solve each problem (or "block") is awarded with a particular amount of bitcoin, which is distributed throughout the network.
The mining of cryptocurrencies such as Bitcoin is one of the two basic methods in which people may make money from them; nonetheless, we are hesitant to promote mining as the preferable method of making money from cryptocurrencies. As a result, mining new blocks becomes increasingly difficult as more processing power becomes available on the blockchain. This means that your ordinary computer has virtually no chance of earning cryptocurrency through mining because there are massive mining operations with literally thousands of computers whirring away to mine new blocks faster than everyone else.
The majority of cryptocurrencies that are available today are obtained through trade, as opposed to mining. Cryptocurrencies, like stocks, are exchanged on exchanges, much like the stock markets that served as the backbone of traditional finance. Cryptocurrencies are purchased and sold on exchanges and are traded between users who use the exchange. The vast majority, if not all, of these digital currencies, on the other hand, are very volatile, which means that their value might move dramatically over the course of a single day, unlike most equities (barring mention of any sudden event that could cause staggering shifts in value).
In order to serve as an example, a recent shift in the position of the United States Federal Reserve on inflation has caused a sell-off among Bitcoin investors, resulting in the cryptocurrency losing more than 40% of its value in only two months. And, given Bitcoin's position as the world's most valuable cryptocurrency, similar emotions have also weighed on the value of other cryptocurrencies such as Ethereum and Dogecoin.
What is a Crypto Casino?
Now that we have a solid grasp of cryptocurrencies on a fundamental level, it is time to use this information in the context of online casinos.
The crypto casino (also known as bitcoin casino by most gamers) is a type of online casino site that either completely or partially accepts cryptocurrencies such as Bitcoin and Ethereum as a unit of value that can be used to wager on anything from online video slots to poker. As a result, there are several distinct types of online crypto casino sites that may be distinguished from one another based on how they handle cryptocurrency in comparison to the ones that we are accustomed to using.
As an example, the vast majority of crypto casino platforms that are considered such only make transactions through their accepted cryptocurrencies. In other words, if you sign up for an account at these kinds of crypto online casinos such as Etherium casinos and Dogecoin casinos, then the site will only take in deposits and give out winnings in terms of bitcoin, as opposed to a fiat currency like Canadian dollars.
Alternatively, some online casinos only partly accept bitcoin as a payment mechanism, preferring to rely on fiat currencies as their primary means of transaction rather than bitcoin. One of the most noteworthy examples of this is Vera & John, an online casino site situated in Malta that was the first bitcoin gaming site to be fully registered and regulated.
However, even though bitcoin casinos have not yet been subject to any form of regulation, Vera & John was able to do so because it was already a trusted real money casino from the start, accepting cryptocurrency payments through Bitcoin but converting the Bitcoin to its equivalent market value in Euro before the digital money could be used to wager on the casino site's various games.
Crypto Casino Games
When it comes to online casino games, bitcoin gambling sites have practically perfect parity with their non-crypto counterparts. In other words, just about all of the games that you already know and love from your favourite casino websites will usually show up at bitcoin casinos - the only difference being that bitcoin casinos payout in digital coins rather than the typical currencies you use in your daily life. Here is a shortlist of the most popular sites that accept crypto:
What Makes the Best Crypto Casino?
Cryptocurrency casinos are now available in a variety of forms and sizes, each with its own set of benefits and features to offer gamblers. However, while there are some aspects of bitcoin casino sites that are unique to the world of cryptocurrency gambling in general, the majority of the characteristics that distinguish the best crypto casinos in the first place are not all that dissimilar from those that distinguish regular online casinos in the first place. With that said, here are some of the characteristics you should look for in the best bitcoin casinos.
Crypto Casino Games
At the heart of what distinguishes the best bitcoin casinos from the rest are the games that are available to you to play on these sites. Bitcoin casino reviews will thus go into great detail about the range and quality of games that are available at a bitcoin casino before making a final judgement on it.
Many casino game creators were originally hesitant to supply their software and game titles to bitcoin casinos, which was understandable given the fact that Bitcoin was still a relatively new and unique concept at the time. However, when the benefits of bitcoin and other cryptocurrencies became increasingly evident to the gaming industry, it was only a matter of time until huge and prominent casino game developers jumped on the crypto bandwagon and became a part of the game portfolios of some of the top crypto casinos.
Crypto Casino Usability
As would be anticipated of any web-based casino platform, it is critical that the site, its interface, and its games be all accessible from a range of devices, including mobile devices. In general, online gamblers, and cryptocurrency players in particular, are more responsive to and more inclined to accept new casino website technologies and innovations, both on their own merits as enhancements over old systems and as a matter of embracing new technology as a whole. This is especially true in the mobile realm, where many gamblers have gone in recent years due to the ease of being able to continue their crypto gaming adventures while on the road. Consequently, both mobile casino sites and the desktop versions should be equally accessible on the best bitcoin casino sites, with little to no degradation in performance or ease of use on any type of device.
Crypto Casino Support
Like any website that provides a service to players—especially that of gambling—bitcoin casinos are and should be heavily scrutinised on the quality of their customer support. It is not unreasonable to argue that crypto gambling is more volatile than simply gambling with normal currencies, as we will explain later, and knowing this, it is important that the operators of these online crypto casinos serve players on a proper and fair basis.
Crypto Casino Security
Regardless of whether or not it involves the usage of cryptocurrency coins, the debate and evaluation of any casino website should not be complete without an examination of the site's security processes and safeguards. As a matter of fact, one could argue that security is even more critical for an online bitcoin casino because most blockchain systems do not have any safeguards or backup measures in place that allow players to protect themselves from even the most basic of mistakes when crypto payments or other similar transactions. With this in mind, reviews of bitcoin casino sites should pay special attention to the security measures that have been put in place to protect their crypto deposit options.
How Do You Play at Crypto Casinos?
The process of actually playing at a crypto casino is pretty similar to that of traditional online casinos; but of course, the nature of blockchain technology does give it a few quirks that separate it from their fiat currency counterparts. While different crypto casino sites will have their own specific paths and processes for registration, they are generally categorised into three distinct stages, which we've detailed below:
In order to transact at an online crypto casino site, you will naturally need some cryptocurrency. As we already mentioned earlier in this guide, trading crypto is arguably the best way to acquire the digital coins you will need, as mining the coins yourself has generally become too difficult and not very cost-effective.
In addition to this, though, you will need a cryptocurrency wallet with which to both store and transfer the digital coins you have into and out of your bitcoin casino account. Like the coins that they hold, these crypto wallets number in the dozens if not hundreds at this point; that being said, a few of our recommendations for an easy wallet to use when starting out include MetaMask, DogeWallet, Coinbase, and Binance.
Create a Casino Account
Now that you have one end of the transaction set up, the next step is to create an account at a bitcoin casino of your choice to have the other end of the transaction ready to receive your crypto coins. Compared to traditional casinos, one of the benefits of most crypto casinos (but not all casinos) is that the registration process does not require you to verify your identity by providing sensitive personal information. This is a consequence of the anonymous nature of cryptocurrency and will be discussed in more detail in the next section. Nevertheless, once you have made your account, the final step will bring everything together for the transaction to pull through.
To deposit money into your bitcoin casino account, you will need to log into your casino account, initiate a deposit, and select the cryptocurrency you will be using from the list of payment methods provided by the casino. In other words, if you will be depositing Bitcoin, you will be choosing Bitcoin from the deposit options provided; the same goes with Ethereum, Dogecoin and other alternative cryptocurrencies.
Once the transaction is set up, the casino platform will give you a temporary cryptocurrency address—this is the destination to which you will be sending your crypto to complete the transaction. Depending on the casino and wallet that you choose, the transfer request may or may not show up on your crypto wallet; if not, you will need to initiate a transfer through your cryptocurrency wallet. Verify your credentials on your crypto wallet to confirm the transaction, and voila! You should now have cryptocurrency in your casino account.
Should You Play at a Crypto Casino?
With everything all said and done, we now arrive at the fundamental question: "Should you actually play at crypto casinos?" Believe it or not, the discussion here is not exactly black and white.
Cryptocurrency obviously provides quite a lot of benefits for online gambling, one of the most significant of which is the anonymous nature of the blockchain that does not ask for (and therefore perfectly protects) the personal information of its users. Compared to the typical bank transfer casinos and other traditional casinos, blockchain technology allows for bitcoin casino transactions to be completed in minutes, if not seconds. In particular, the Ethereum blockchain is designed to process new blocks around every 15 seconds, meaning that you can expect deposits and withdrawals to go through that quickly.
On the other hand, cryptocurrency is not quite the saving grace of the financial world that it was intended to be when it was invented in 2008. Take a look at the value of any of the major cryptocurrencies today and you are guaranteed to find a massively overinflated and highly volatile value that could spike and similarly crash on a whim. The volatility of the largest digital currencies right now - for Bitcoin, Ethereum, Dogecoin and Litecoin casinos and the like - is making holding them in the first place a gamble in and of itself. This means that you might find yourself winning or losing so much more on a crypto wager when its value suddenly shifts.
While the nature of crypto allows for the system to be practically immune to "man in the middle" vulnerabilities (in which transactions are intercepted and altered by a third-party as it is being processed), blockchain technology in general does not protect users from any mistakes made on either end of a crypto transaction. One of the most egregious examples is the fact that, if you send your cryptocurrency to a mistyped address (which is quite easy to do considering the fact that crypto addresses look like random strings of numbers and letters), there is no way to get it back. While there are some that will argue that this is purely the fault of the person making the transaction, it should be noted that normal payment methods do at least give you some means of protection from simple—and common—mistakes like these.
Regardless of your answer, though, there is no denying that crypto is not going away any time soon. The benefits that it offers to bitcoin casino players and operators alike are not to be understated, and it is practically guaranteed that crypto gambling will continue to grow and mature over the years.
Crypto Casino FAQs
What are crypto casinos?
Crypto casinos are online casino websites that principally adopt the use of cryptocurrency as a valid method of payment. These casinos may or may not need to convert the value of crypto into a baseline currency.
Can you gamble with cryptocurrency?
Yes, you can gamble with cryptocurrency at bitcoin casinos. Depending on their payment structure, casino websites will typically take cryptocurrency like Bitcoin or Ethereum as the wagering currency, which in turn will make your winnings from the casino's games be paid out in that cryptocurrency.