Tesla CEO, Elon Musk, once said, “Paper money is going away.” Hinting at cryptocurrency, Musk suggested that “Crypto is a far better way to transfer value than pieces of paper, that’s for sure.” Well Musk’s prediction seems to be coming true because crypto is becoming a popular currency form to not only invest in, but also to buy goods and fund a player’s online gaming wallet.
During the COVID-19 pandemic, many businesses including land-based casinos have seen a temporary halt to their operations. But throughout the pandemic, online gaming and cryptocurrencies have rose in popularity. The global online gaming revenue hit approximately $66 billion in 2020—an increase of $8 billion when compared to 2019. Also, according to Investopedia, “Bitcoin and cryptocurrency prices skyrocketed to new highs in 2020.”
Cryptocurrencies offer a variety of benefits to players and operators, which is why many online gaming operators have begun incorporating cryptocurrencies such as Bitcoin and Ethereum to their platforms. According to Blokt, some major plus-points of cryptocurrencies in online gaming include: bonuses, transparency, and anonymity.
SportsGamblingPodcast suggests “It’s a lot cheaper for gaming operators to process cryptocurrency payments compared to processing payments made with fiat currencies,”—resulting in operators offering better bonuses and promotions on crypto gaming platforms, which leads to player acquisition and retention.
Another important aspect of cryptocurrency is transparency. Eliminating fraud and ensuring fairness is a top priority for gaming operators. According to GamblingSites, “every part of a cryptocurrency transaction is verified by the network and recorded digitally for all parties to see”—decreasing the possibility of fraud. A safe and secure gaming platform is a very attractive component for players looking to join online casinos.
Lastly, players using certain cryptocurrencies can benefit from a high level of anonymity. Cryptos such as Monero are highly preferable due to its private and anonymous nature. According to TKEY, “Crypto players using XMR [Monero] can be sure that no third party will get access to their personal data and know about their gains and losses.” In recent times, the protection of personal data has become an extremely important part in many industries. So when gaming operators include cryptos such as Monero, it helps build trust between the player and operator—resulting in more business.
While cryptocurrencies have started to become more popular in the online gaming space, they do face many hurdles such as: transaction speeds, regulations, and value fluctuation. These obstacles will take time to tackle as crypto and blockchain are a new and evolving technology. But only as time progresses will we know if cryptocurrencies stay pertinent for the online gaming industry.