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How Bitcoin Casinos Work

As Bitcoin grew popular as a global digital currency, it created a new economy around it, as against the conventional currency-based economy. While the popularity of transactions with Bitcoin and other cryptocurrencies continues to grow, they’ve created a separate online arena for gaming, lotteries and gambling, through what is known as Bitcoin casinos.

Gone are the days when a Bitcoin casino lacked games or software. In 2021, players in the UK can enjoy some of the best Netent games, along with casino games from a selection of other developers.

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What Are Bitcoin Casinos

For people that do not know much about Bitcoin, this stands as the most popular of all the digital currencies, and it is designed to work on a system known as Blockchain technology. Some of the online casinos out there conduct their entire payments on Bitcoins, while some others accept Bitcoin transactions as an addition to the traditional or fiat currency transactions like the euro, pounds, and us dollars.

The number of online casinos that offer money based games and gambling in Bitcoin currency is growing by the day. Bitcoin casinos operate across the globe, though there are supposed to be local laws binding them. These casinos deliver an avalanche of options for players to wager their Bitcoin on many games like spread betting, online lotteries, and sports based betting, gambling games, and the conventional casino games, all through Bitcoin transactions.

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Key Takeaways

We can describe the Bitcoin casino as a venue for internet gambling, lotteries, and games that work with the Bitcoin cryptocurrency primarily.  This is not legal in the United States, but the anonymity of transactions with Bitcoin makes Bitcoin casinos to be very popular. The popularity is also enhanced by the allure of the amount of variations of games found in Bitcoin casinos, the fact that the transactions come with zero fees, and the possibility of unlimited daily transactions. There are speculations that Bitcoin casinos will have a very huge impact on the entire Bitcoin market, but there is not much data to back this claim. However, the ethics surrounding the Bitcoin casino subsector is still very grey.

How a Bitcoin Casino Works

Just like every online gaming or gambling business relies on software, Bitcoin casinos also rely hugely on software. Most of the Bitcoin casinos that have garnered huge popularity and large user base have their proprietary gaming software that they developed by themselves. But the smaller and not too popular players in the sector make use of rented or purchased software, which they just need to customize to their preferences by adding a few special or unique features to the titles.

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The game is conducted and run by the software, and the human intervention is very minimal. In games where human players are needed, the software takes up the job of dealers or croupiers and conducts the game. Because their business is fully digitized, Bitcoin casinos often find it very difficult to convince the players that their operations are fair. In the bid to establish the much needed trust, most of the Bitcoin casinos resort to revealing the workings of the algorithms of their software. The remaining work of attracting users is done by the uniqueness of what they offer in the casinos and peer to peer preference. The most popular game for Bitcoin casinos is poker, though they have other interesting games like lotteries and variations of other traditional and interesting games.

Why Bitcoin Casinos Are Becoming More Popular

The biggest advantage of Bitcoin casinos remains anonymity, and this entails that every Bitcoin transaction happens anonymously, so much that even the founder of Bitcoin did so with a pseudonym Satoshi Nakamoto.

In most of the Bitcoin casino sites, there are no transaction fees, and there are also no limits to daily transactions, while there are transaction fees and set limits per day for traditional currency transactions. Because of the internet digital nature of the business, it could be accessed globally and easily by a large number of players at any given time of the day.

Since the authorities cannot easily control online games, most of the online games come with tweaks to the rules of the game designed into them. These types of games are legally prohibited in online casinos that operate with traditional currencies, and this is one of the major reasons why Bitcoin casinos are becoming hugely popular.

Why Bitcoin Casinos Are Being Scrutinized

Regulations have been streamlined by the conventional online casinos that transact with fiat currencies. With payments in such casinos, casino operators, dealers, as well as individual players could be identified and tracked. But this cannot happen in Bitcoin casinos.

Given the purely digital nature of Bitcoin casinos, verification and audit becomes a very big challenge. In an online card game for instance, we may not have any guarantee that the cards have been shuffled properly and distributed as they should be. In addition, if because the player pays anonymously with the digital currency, their anonymity is maintained, then there are a lot of questions as it concerns fair business practices.

The user detail required by most of the Bitcoin casinos is very minimal, mostly just the email addresses and log in names. Things like location check, age verification and other details are overlooked. Majority of the countries in the world do not allow gambling, and efforts to regulate and control gambling on the world scale is made even more difficult by Bitcoin casinos.

The entire operational methods of the Bitcoin casinos mentioned above prove huge challenges to the authorities, as the new parallel economy continues to shape up. Although the advantages that it offers as a digital based currency may be emphasized, there are many challenges that come with casino based gambling.

Legal Aspects 

Because of the type of challenges that come with aforementioned Bitcoin transactions, the United States has made running Bitcoin casinos illegal. The majority of Bitcoin casinos you will see on the web are not incorporated in the United States. Enthusiasts from across the globe, including those from the United States make their transactions on these Bitcoin casinos anonymously, and this makes it very difficult for the authorities to legalize, control, and regulate the transactions. Because such anonymity-based businesses do not offer open information, it becomes very difficult to gather the type of information that would be enough to enforce rules.

Impact of Bitcoin casinos on Bitcoin transactions

Because there is not much information available to the public about Bitcoin transactions, details revealing the impact of Bitcoin casinos on the currency itself are not easy to access. But working with the scanty data available, there is the belief that the launching of the gaming site in April 2012 alone made the total number of daily Bitcoin transactions to go up 5 times. A look at this reveals how the anonymous world values gambling. In reality, the amount of transactions in Bitcoin casinos has been increasing steadily since 2012. This also helped in booming the usage of Bitcoin.


The ethics of both fiat money and anonymous digital currency gambling transactions has always been a topic of debate. This becomes even more challenging because of the complexity of Bitcoin and its anonymity. While clutching on easy money making options may seem exciting, users must consider the risks, both legal and ethical.

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Milcah Lukhanyu
Milcah Lukhanyu
I cover tech news across Africa. Drop me an email at [email protected]

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