BITCOIN: THE RISE OR FALL OF ONLINE GAMBLING?

Published on October 31, 2014 in Industry News

BitcoinsBitCoin, a little known crypto-currency, grabbed the attention of the internet in 2013 when a story broke about a Norwegian, Kristoffer Koch, who bought 5000 bitcoins in 2009 for the paltry sum 150kr (roughly $27) and then forgot about them, hit the jackpot. Fast-forward four years and Koch is now sitting on a small fortune worth just short of $900,000!  It was this rags-to-riches story that dragged BitCoin (launched in 2007) from relative obscurity to public sensation.

BitCoin, saint or sinner?

Like many who challenge the norm Bitcoin is equal measure saviour and destroyer depending on who you speak to. Satoshi Nakamoto, individual or organisation no-one knows, created BitCoin as a way to challenge the way governments and institutions control your money. The vision was for a currency for the people by the people.

Governments and economic bodies however were quick to point out how the anonymity of the currency undermines “national security” and “funds crime”. Pointing out the plethora of illegal transactions facilitated on the now infamous Silk Road website where layers of sophisticated security meant that for some crime did pay. 

Gambling with BitCoins

Facing similar challenges it was only a matter of time before online gamblers embraced BitCoin and savvy developers produced BitCoin gambling products. Moving beyond BitCoin casinos where you get to play a slot machine or a few hands of blackjack, the world of BitCoin gambling has a vast and varied range of betting games. Some of the more unusual ones include being able to bet on a game of MineSweeper with a maximum bet of 1 Bitcoin (valued at $330-$350 depending on your preferred exchange), and the chance to win up to 9x your bet value!

Is it too good to be true

It would appear that BitCoin is the white knight that has been needed to allow online gambling to grow to the next level. After all it has a community engaging at every level, from helping with secure anonymous transacting, to active Q&A forums where game algorithms are discussed and the operators actually participate and value the input. In addition it has made massive strides forward in terms of side-stepping the deluge of licencing and transactions restricting efforts put in place by local authorities to either shut down or claim control over online gambling.

Yet sceptical minds are asking the hard questions. With trusted BitCoin exchanges such as Mt. Gox losing the equivalent of $500 million in value leading to its closure, and the BitCoin bank Flexcoin having gone the same route only a week earlier, is this platform trustworthy and sustainable? 

Not only that but will the governments being so eloquently sidestepped sit back and watch millions in revenue slip through their fingers or will this cause them to put even more stringent measures in place to monitor financial transactions and internet usage. While transactions online are anonymous the items you purchase with them are not as easy to hide.  Big Brother is mostly silent at this time but we all know he rarely truly sleeps. 

Time will tell

Whether a sustainable growth factor in legitimate online gambling or a short terms fix to a marketplace that currently has more questions than answers the one thing BitCoin has accomplished in its short lifespan is to present a possible future where you determine how to use the wealth you’ve generated. And that is worth the gamble.