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Provably Fair Blockchain Algorithms the New Fad in iGaming

by James Musoba
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There is a record amount of crypto-based online casinos flooding the wires of the internet. Following this trend is a growing number of casino players signing up to play video slots and table games as their primary choice of online entertainment, but rather than bet fiat currency, they are using cryptocurrency.

Currently, the casino industry is worth a massive $67 billion these figures will continue to rise with the prediction on the Statista website showing that the industry is worth $92.9 million by 2023.

The continuous rise in online gambling is for several reasons:

  • HTML5 games allow players to play from their mobile
  • The industry is becoming more trustworthy
  • Licensing authorities now operate in multiple European countries
  • Algorithms are increasingly advancing producing fair results
  • Games accept multiple currencies and cryptos

However, the crucial point most online casino players want to ensure is 100% trustworthy is how the games produce ‘fair results’. This is all down to ‘RNG’ and ‘Provably Fair’ algorithms. RNGs are for fiat currency games and Provably Fair Algorithms are for cryptocurrency games. 

As a result, many of the freispiele ohne einzahlung now equipped for both cryptocurrency and fiat currency gaming.

Online Casinos Use Aggregator Platforms for Virtual Game Algorithms

Online casinos use casino platforms provided by aggregators such as Playtech and NetEnt. Aggregators are a ready-to-use online casino software platform solution. Once a casino operator agrees on a B2B deal to use a casino platform, it will white label the casino platform to create an all-encompassing online casino brand.

For fiat currency games, aggregator casino platforms use an RNG. You can read more about how ‘Random Number Generators’ work here. Third-party companies inspect the RNG and issue a certificate of fairness. For instance, the UKGC will ask companies to produce reports to verify the RNG is at a certain online casino is reliably producing results for games such as online slots and virtual table games like blackjack and roulette.

The same applies to other licensing authorities, such as the MGA (Malta Gaming Authority). The only issue here is that casino players must rely on the third-party company word that the algorithm is fair.

Cryptocurrency Games Use Provably Fair Algorithms

When players bet using cryptocurrencies, there is no RNG. Instead, the casino platform connects crypto slots and table games to a provably fair algorithm. A provably fair algorithm creates server-side and client-side seeds.

The server-side seed is a hash or encrypted block that contains all the results of the player’s hands, dice rolls, or spin on a roulette wheel in advance. This ‘seed’ sits inside as an immutable record on the ‘public ledger’ of the cryptocurrency the player is using to place bets. However, no one can see the information the ‘public ledger’ entry holds on the blockchain ecosystem because it uses high end encryption.

Only when the player finishes his/her session will the client-side seed inform the server-side seed the session is over and the ‘public ledger’ entry can now decrypt.

Once the system decrypts the hash on the blockchain ecosystem all the hands inside the seed are now publicly available. Any player can use online software to check the integrity of the results provided by the video slot or table game played. And the beauty of this entire procedure is that this is an immutable record, i.e. there is no way for anyone to remove it from the blockchain’s ledger.

With the results of every cryptocurrency bet recorded on a public ledger, it is possible for anyone with a curious mind to go back through every session played on a particular online slot or table game by all players over time, and there are plenty of people that do so.

They check the integrity of the results and check the ‘total percentage payout’ for that game since its release. Just this alone is enough to deter a casino from cheating its games while it also offers transparency.

From a player’s point of view, the provably fair algorithm gives them the chance to check the results of every session played so they are 100% satisfied that the results produced were fair. On top of this, no one can manipulate the results as the blockchain records a permanent, unchangeable record.

This is as opposed to RNG algorithms in which players need to rely on the word of a third party company that says the algorithm is producing fair results.

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