Cryptocurrencies in Gambling
Counterfeiting a currency is viewed as one of the most serious crimes. After all, if anyone could print money, the monetary system becomes compromised. Everything in our society revolves around money. So the penalties for counterfeiting are severe. In fact, the penalties for crimes related to money can be more serve than if you murdered someone. This includes failing to pay tax – not just counterfeiting.
However, “creating money from nothing” is exactly what banks do. They don’t need to work for money like the rest of us. It’s not something ordinary people could legally do.
But now, almost anyone can create a “virtual currency”. The best known is Bitcoin, which no doubt you’ve heard of. But there are currently thousands of similar virtual currencies.
The first part of this article doesn’t seem related to gambling. It is, but first you need to understand the concept of “trustless currency”.
How Money Is Created
Firstly, understand the money provided by governments once was backed by physical gold held by the government. Once upon a time, the government could not create money that they didn’t have backed by gold. This is no longer the case. Now the governments can create money with nothing backing it. More precisely, the federal reserve creates the money, and loans it to the government – with interest. We as taxpayers pay the bill. That’s right, you’re paying banks for money they created from nothing. Sorry if you thought your taxes went to paying for schools and hospitals.
Here are a few other things you may not have known:
Firstly, the federal reserve is a private organization. It is not government or federal at all. Basically the governments gave private banks almost complete control of the global financial system.
Secondly, the loaned money (which didn’t even exist before) is paid back to the banks. So that means when you take a loan, that’s money that was just created. And it will end up in the bank’s hands.
Thirdly, the interest is money that hasn’t even been created yet. So how can banks get paid the full amount they’re supposedly owed? They can’t. There just isn’t enough money in circulation. So it is a mathematical certainty that some people will default on loans, and end up forfeiting assets like houses to the banks.
The system is rigged, beyond belief. There’s more to it, but most people don’t have the slightest idea of what’s really happening. They are too busy with work and paying bills, and financial talk is too complicated for them to follow on the news. Not to mention the news stations don’t even have the full story anyway.
The Emergence Of Bitcoin
Bitcoin is a “virtual currency”. Like money from governments, it is just “numbers on computers”. Government-created money can include physical coins and notes. There are some variations of Bitcoin that include physical coins too, although they are either microchips with digital information, or data like passwords to accounts.
If Bitcoin is a mystery to you, it shouldn’t be. It is just a database of accounts and balances, like you have with your local bank. But the key difference is the database is shared across thousands of different computers, which are not controlled by any single entity. This is why it is called “decentralized”.
The Benefits of Decentralization
Decentralization means nobody specific has control. There is no corrupt government or bank that calls the shots. And Bitcoin uses a unique set of algorithms that make it near impossible for anyone to make money from nothing. At least that’s the theory. In reality, Bitcoin is not all it’s cracked up to be. I’ll leave that explanation for another time. But the main point here is a decentralized Bitcoin is far better than money governments and private banks can create from thin air.
Cryptocurrencies In Gambling
Some online casinos are licensed in offshore jurisdictions, mostly because it is easier to obtain a gaming license. Most of the larger online gambling companies are licensed and regulated in major jurisdictions, such as the UK. Only ever play at a licensed casino. You can see a list of them at roulettepro.com if you play online.
Generally you’d expect the jurisdictions with more experience in licensing casinos to be overall better. And it usually is in terms of rules to protect players. But there have been many cases where casinos licensed in areas such as the UK acted dishonestly. Likewise, there are casinos in other jurisdictions who have acted dishonestly. By that I mean classic problems like payout refusal.
I’m not going to name names in this article. It isn’t hard to research a casino to see which are likely dishonest.
Cryptocurrencies solve the problem of payout refusal. But not all cryptocurrency casinos are the same.
Just because a casino accepts cryptocurrencies doesn’t make them honest. There are two parts you need to consider:
How Wins Are Determined
If a real roulette wheel is used, and you can see the live video, this gives you greater assurance the casino isn’t cheating. If you can chat live dealers, it’s best because then you know the video is live. It doesn’t mean the wheel isn’t rigged. In fact many people send me video to check, because they suspect the ball’s behavior isn’t normal. I haven’t found any unreasonable ball behavior from videos, yet. In cases where games are decided by random number generators, you would need a way to verify the outcomes are fair. All players interested in learning how to win roulette need to focus on the mechanism that determines the winning number.
Instant Immutable Payouts
If you win, you should be paid immediately to your cryptocurrency account. The most popular network for this is currently TRON. Tron is a blockchain network capable of running many trustless decentralized applications. This means it can run software and procedures that are verifiably fair. Not only that, your winnings are paid directly to your account. So you don’t need to worry about payout refusal.
If the above two parts are done properly via a blockchain like Tron, then the casino owner’s honesty is irrelevant. There is no chance for them to cheat you, unless they use a fake blockchain. Remember the purpose a gaming license is supposedly to ensure compliance with strict procedures, to protect gamblers. Is it really? Partially, yes. But for the most part, no. The regulators themselves aren’t even aware of what happens at higher levels of government. Again most governments consist of good honest people, trying to do the right thing. But there are always the bad apples, and unfortunately they are often in positions of power.
The idea behind cryptocurrency casinos is so you don’t need to worry about reviews of casinos, including whether or not they’re honest. And I believe this is where online casinos are headed.
Does it mean there wont be regulated casinos? No, of course there will. Most laws exist for good reason. But the whole idea behind cryptocurrency casinos is trust isn’t needed, because everything is transparent. And if you win big, the casino has no say in whether or not to pay you.
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